To succeed in the 21st Century, individuals, businesses and organisations need to develop the skills that are needed to thrive in a context of complexity and uncertainty.
Dr. Seth Nicholls, Director, Nicholls Consulting Services.
A few weeks ago, I was enjoying a lively conversation with a highly intelligent colleague when the conversation turned to a topic about which I have thought a great deal over the past few years: decision-making.
“So what is a good decision?” I asked her.
“One that leads to a desired outcome”, she replied confidently.
“Are you sure about that?”, I asked.
“Of course”, she said, “if I make a decision and it leads to the outcome that I want, it’s a good one”.
“So if, for example, an individual was to drive their car home from a hotel while highly intoxicated and knowingly over the legal limit, and make it home safely, that would be a good decision?”, I asked. She hesitated.
“Well…no”, she said.
“But the outcome was a good one, wasn’t it? The goal of the individual was to make it home safely, and they did”.
My colleague looked slightly confused.
“Or suppose”, I said, “that the same individual, recognising that they were intoxicated, decided instead to travel from the hotel at which they were drinking to their place of residence via an Uber, only to be killed in a car accident involving the Uber and another vehicle en route. Would that make the decision to get an Uber home (while knowingly intoxicated and over the legal limit) a bad one”?
At this point, the look on my colleague’s face went from confusion to irritation.
“So why bother trying to make good decisions?”, she asked?
“Because”, I replied, “a good decision can be expected to significantly increase the probability of achieving a desired outcome. In the context of complexity and uncertainty, that’s the best we can do.
The conversation above is one I have had many (many) times with colleagues, clients and friends. The confusion (and irritation) on my colleagues face was understandable. On the one hand, her confusion can be attributed to the counter intuitive relationship between decisions and outcomes (i.e. “I can make a bad decision and get a good outcome and I can make a good decision and get a bad outcome”).
On the other hand, however (and perhaps more importantly), my colleague’s confusion can be attributed to the fact very few people have actually been trained how to make a high quality decision. This is very peculiar in light of the fact that:
- Human beings make more than 1,000 decisions a day and some of these decisions can have profound consequences for themselves, their loved ones, their colleagues, their employees / shareholders, clients and their friends.
- Decision-making is the only thing over which any of us actually have any real control. It is the only way that individuals and organisations can purposefully influence the direction of their lives.
- There are evidenced based tools and knowledge with which individuals and organisations can be equipped to dramatically improve the likelihood of achieving better individual, business and organisational outcomes (e.g. personal success, higher profits, increased market share etc).
The Science of decision-making
Over the past decade, the fields of behavioural economics, neuroscience, psychology and others have revealed a great deal about the way in which human beings make decisions ‘naturally’ (i.e. in the absence of conscious, deliberative thought or explicit decision training). Much of this work has focused on the identification of a large number of unconscious biases and ‘decision traps’ into which we can fall – all of which can (and frequently do) result in individuals and organisations making poor quality, sub-optimal decisions.
Moreover, the fields of strategic decision-making and decision analysis (pioneered at Universities like Stanford and Harvard) have developed a large number of high quality, evidence based tools that can be used by individuals, businesses and organisations to measurably and proactively improve the quality of their decisions – resulting in choices (e.g. resource allocation) that are much (much) more likely to yield desired outcomes.
These tools, however, continue to remain something of a secret and practical application of such insights has been limited. Indeed, the potential for such knowledge to improve the quality of the decisions made by individuals, businesses and organisations (and thereby maximise the probability of achieving desired outcomes) has barely been tapped.
For individuals, businesses and organisations who are prepared to invest in this most important of skills, however, a decisive competitive advantage awaits – one that can mean the difference between failing, surviving or thriving in an increasingly competitive, complex and uncertain environment.
