Everyone makes decisions, in different ways. Understanding how you make decisions is a critical step to making the right decision for your company or organization.
In a study conducted by the strategy and corporate finance company McKinsey & Company, authors Dan Lovallo and Olivier Sibony identified five styles based on six pairs of opposing characteristics common in decision-making processes:
- Prefers ad hoc or process.
- Prefers action or caution.
- Gathers information narrowly or widely.
- Believes corporate interests or personal interests prevail.
- Lkes continuity or change.
- Prefers storytelling or facts.
No decision-making type can be defined as "good" or "bad," but each style has distinct strengths and weaknesses. Consider these decision-making personalities to find the one that best describes you, and see the steps you might take to help improve your decision-making process.
"A champion of radical change with a natural gift leading people through turbulent times," the visionary likes change. With a preference toward taking action, rather than proceeding with caution, visionary decision-makers gather information narrowly and "may be too quick to rush in the wrong direction."
Visionaries should "seek out different perspectives from a broader group of counselors." Don't be afraid to allow dissenters to voice their concerns.
"A model of fairness who preserves the health, balance and values of the organization," the guardian follows a decision-making process that "is sound, carefully planned and incorporates as many facts as possible." Guardian decision-makers prefer fact-based choices and thus gather information relatively widely, but "may be blind to a desperate need for change" in an organization—and aren't the best to have at the helm in the midst of a crisis.
Guardians should "periodically ask outsiders to challenge deeply held beliefs about the company and its industry." Don't be afraid to explore major changes.
"A compelling leader for change with an excellent ability to build alignment," the motivator is strong and charismatic. With a knack for storytelling, motivators can convince others of the need for action. They strongly believe self-interest prevails over corporate interest, and they gather information relatively narrowly—risking the facts for the belief in the vision.
Motivators should "examine alternative ways to interpret the facts." Formal processes, such as a survey, could help take a pulse on the organization.
As the name suggestion, flexible leaders are "comfortable with uncertainty, open minded in adapting to circumstances and willing to involve a variety of people in the decision making." These decision-makers prefer ad hoc approaches rather than processes, yet proceed with caution. Exploring all of the potential issues, solutions and outcomes could lead to "paralysis by analysis."
Flexible leaders should set deadlines to reach a decision before entering the debate. Standardizing ordinary repetitive decisions could help save time.
Considered the most balanced of decision makers and relatively resilient to biases inherent in extreme decision-making processes, catalysts are "true champion[s] of group decision making and implementation." While these decision-makers tend to gather information more widely than narrowly, and slightly prefer action to caution, they fall in the middle of the road of other extreme characteristics—a style that "may yield average results."
Catalysts should "be alert for the telltale signs of a high-stakes strategic decision that may require a different approach." Consider assembling a team to look at the situation with new eyes and make recommendations.
Written by Cassie Westrate, staff writer for Groups Today.