How to be a master decision maker and get better outcomes and results

Hit Leader Hass Leadership, Management Leave a Comment

Results can either be good or bad. Generally, if we get a bad result its a giant neon sign telling us to go back and look at our process again. However, when we get good results we tend to not review our processes. A good result can blind us into thinking the process is perfect. Have you ever thought – what if results are uncertain? What if there are hidden facts that I do not know that could affect the outcome? Would you be able to say you are certain of an outcome? What would happen if you accepted uncertainty?

To be better decision makers and improve our chances of better results we need to detach results from processes.

Results and failure

A bad result should tell us we are doing something wrong. Whenever we have a bad result, it is important to go back and review the road we took to get to the result. Retrospectives, as outlined in this post are a good way to get a view of what went well and what could be improved at various points in a project. A bad result isn’t the end of the world. A bad result provides some great information for us to reverse engineer our process to identify how to improve. A bad result does not always indicate a bad process.

An important point to realise is that we don’t always have control of the result. We may control the process and steps on the road to achieving a result – but whether the result is positive or negative may be out of our control. For example, if you have ever done a bid for some work – your process is outlining the value you will provide over a period of time, for a particular need, at a particular cost. Once the bid is submitted it is out of your control. There is a chance that your bid will fail and there is a chance it will succeed. This highlights the importance of ensuring the aspect that’s in your control is the best it can be. To make the process the best it can be, you need to learn from the times it fails. You need to be willing to prune and adapt it so you can see more wins than losses.

The elusive facts

We don’t always have all the facts. There can be a gap in what we know. We need to ask around the process and proposed solution to get as large a data set as we can. This allows us to understand how close to the mark we are going to get with our result. It’s important to recognise that because we can’t know everything there is always a chance of failure. I believe, when possible, a good leader should always try to quantify decisions and potential outcomes. Being able to say “there is an 8% chance of failure” shows that you have thought about likelihood, that you understand that you cannot hold all the answers, that you are humble in knowing you cannot always be right and it will engage others to question the potential outcomes and the process or solution. Why is there an 8% chance of failure? Is there a way we can reduce this 8%? What would be the drawbacks and compromises we would need to make to reduce the chance of failure? Is there a way we can get more control of the outcome to reduce the chance of failure? What is the chance of failure if we go with solution B instead?

“Improving decision quality is about increasing our chances of good outcomes, not guaranteeing them. Even when that effort makes a small difference — more rational thinking and fewer emotional decisions, translated into an increased probability of better outcomes — it can have a significant impact on how our lives turn out. Good results compound. Good processes become habits, and make possible future calibration and improvement.” – Annie Duke

Annie Duke is a professional poker player and author. Annie talks a lot about how we can think in bets/probabilities to make better, more rational decisions to increase the chance of better results. Her book Thinking in Bets goes into more detail on how you can do this effectively (get it on Amazon: UK / US).

We need to become comfortable with uncertainty. It is absolutely ok to not know all the answers and it is ridiculous to ever think that you or anyone else will always have all the facts. If we become comfortable with uncertainty we can start to ask good questions and edge towards closing the gap.

As a leader, when you present a strategy try to figure out what uncertainties there are. Bring some probabilities to your strategy. If you do that, you and others will start to question the strategy in order to identify whether it is the best option. Also, when your team come to you with possible solutions ask them what they think the probability of success is. Ask them why they have given you that probability. Ask them if there is a way to improve it. This works especially well with those team members that have a bit of an ego. This line of questioning and asking for a probability allows them to take a step back and take an objective look at what they are proposing. Therefore you will be getting a much more focused and objective picture from them.

“Our comforting conviction that the world makes sense rests on a secure foundation: our almost unlimited ability to ignore our ignorance.” – Daniel Kahneman, Thinking Fast and Slow

What if things go well?

What do you do when you get a good outcome? You don’t do anything. “If it ain’t broke, don’t fix it”. When we see positive results we tend to ignore the process. The process is deemed to be good because the result is good. If some results are based on chance and we don’t have full control of them – how can we know this to be the case unless we look at and analyse the process independent of the result? When we get the right result, we may not realise it but that result was only 75% likely. Or 80% likely. Or even 90% likely. There is always hidden information to be found to improve the probability of a  better outcome. If we want to be great leaders and great decision makers we need to understand that just because we get the right result doesn’t mean there is nothing to improve upon.

Whenever I run retrospectives it is a regular occurrence and does not depend on a success or a failure. In a retrospective, we still look to identify areas for improvement even if the project is an absolute success. If your business is in a competitive environment and you stop improving, what will happen? Your chance of success will decrease even though you have kept the same process. You need to get ahead of the game and look to improve and adapt.

“Treating decisions as bets, I discovered, helped me avoid common decision traps, learn from results in a more rational way, and keep emotions out of the process as much as possible.” – Annie Duke

The gut-brain

The opposite to having slow, objective thinking is using our gut-brain. That’s the quick acting brain that you know as “instinct”. Your gut-brian is great at reacting quickly. In order to act quickly, your gut-brain makes assumptions. It acts on information that might be correct or incorrect. Your gut-brain doesn’t do a thorough analysis, it automatically and speedily identifies high-level connections between events. If we just rely on our gut-brain thinking, we are prone to make bad decisions based on biases and heuristics.

We need to be careful as leaders to not fall into the trap of always trusting our gut-brian. The gut-brain can get better at making decisions, and often does with a large data set to work to (life experience), however, it can be detrimental to quality decision making. It is important to be able to understand when you are falling into this trap and skipping out critical, objective thinking for use of the gut-brain. The problem with the gut-brain is that it is so easy to use, it is so quick to use, so when people keep getting good results they believe their gut-brain to be able to do the necessary objective and critical thinking to make the right decision. This is absolutely not the case and is yet another situation where good results can be blinding.

One way to ensure you don’t always use your gut-brain is to take it slow. Don’t make a decision immediately, instead just stop and think about it.

“Intelligence is not only the ability to reason; it is also the ability to find relevant material in memory and to deploy attention when needed.” – Daniel Kahneman, Thinking Fast and Slow

If you want to learn more about how your gut-brain (System 1) and your critical thinking, slow brain (System 2) work together check out this book by Daniel Kahneman called Thinking Fast and Slow (get it on Amazon: UK / US).

Summary

  • Don’t let your outcomes and results determine your decision-making process
  • Use retrospectives to evaluate processes and decision making whether the result is good or bad
  • There are always hidden facts – ask questions and look for them but accept that you will never be 100% certain
  • Describe decisions and possible outcomes in probabilities of success and, or failure
  • Don’t let your gut-brain dictate every decision. Stop, take a minute and think. It is OK to react a little slower if the decision process is better quality

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