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We assume that decisions and decision making are important in business. Yet few of us really understand how we make decisions. We do not understand how our partners and customers make decisions. We confuse analysis, planning, schmoozing and inspiration with deciding.
Many times we flatter ourselves that we are in fact deciding something that has many and subtle options. Most business decisions are like the available options in a bear or bull stock market. There are really three choices: do nothing, buy, or sell. We think we are really clever when we combine at least two of the three choices.
Even with these limited options, we confuse support activities with deciding. While financial analysis is useful, at the end of the day it is analysis and not a decision. Generally, we make the decision and use the financial analysis to justify the decision to ourselves and others. Having a gut feel that the Internet is the future is not a decision. Perhaps it is a guiding vision or hallucination, but it is not a decision. We may decide to buy, sell or let it pass and use this vision to justify our action.
After observing hundreds of people in thousands of situations where "decisions are made," I find that generally the actual decision is made without being aware of what you are doing. After the fact we reconstructed how we reached our decision according to our preferred style of narrative. Twenty-twenty hindsight seems to be necessary for identifying key decisions. With hindsight we can see what we were deciding. If we are attentive, we may also see how we made the decisions.
The hard part about watching ourselves make decisions is that we might observe something in ourselves that is not part of our dominant narrative. It is disturbing to learn that our brilliant entrepreneurial insights are reigned in by our own fear of pushing the details.
What does it take to be an artful decision maker? I have observed that there are seven perspectives to master.
1. Admit that we have little control over our available options. Frequently, what we are deciding only has one true choice. We must not play devils advocate and invent choices to validate the single choice. When we do this we generally talk ourselves into a pretty fiction over the mundane.
2. Avoid the delusion that we can control anyone or anything other than our own self in a limited manner. If the kayaker shooting the rapids believes for a moment that he can control the river, he is lost. Most of us most of the time can only react to what is presented to us. Our reactions may be very skillful, but they are reactions nonetheless.
3. Remember the objective and avoid getting lost in the myriad details of the means. Frequently we forget that capital is the means for creating a business. It is not the end of our businesses. An illustration of this point in the September - October 1999 Harvard Business Review. John Peterman outlines what led J. Peterman Co. into Chapter 11 bankruptcy and dissolution. Mr. Peterman spent more time schmoozing venture capitalist than he did focusing on the romantic clothing that made the company.
4. See yourself as others see you. Why do my suppliers think I do business with them? Why do my employees work for me? When I see myself as others see me, I see a view of my motivations that is perhaps more bleak and definitely unromantic. This is how people think I make decisions. Maybe this is the truth.
5. See others as they see themselves. We already see others through our own filters. We know what makes them tick. But if we do not really understand how they see themselves, we have seen but the tip of the iceberg. If you can walk in another person's shoes, you know his stride.
6. There must be other points of view. The fastest way to get more options is to get more people involved in the decision. We must not be so fixated on accountability that we lose sight of the fact that as individuals we are vastly limited. Even if the accountable one "has to make the decision," it is probably someone else who makes it so? How does the person who has to implement the decision view the situation? See perspective 5.
7. Understand and trust process. Any true decision sets things in motion. Events in motion have their own inertia. We must follow through to the end of the motion. A midcourse correction generally leads to disaster. Consider an airplane taking off. It must attain a certain altitude before it can start doing things like turning. We must understand and trust the processes we set in motion.
I refer to these seven points as perspectives because in my experience, decision making rather than reacting occurs through understanding and humility. Understanding and humility only occur when a persons is grounded in the reality of the world. This means that both feet have to be connected to the earth and you can feel your feet.
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