Matching the Process to the Decision

Two variables

The effort a decision deserves depends on two things: how consequential it is, and how reversible.

• Reversible and low consequence — decide quickly, act, and adjust if wrong. Deliberating extensively wastes more than the mistake would cost.
• Reversible and high consequence — decide with reasonable analysis, and build in review points.
• Irreversible and low consequence — a moment's thought, then proceed.
• Irreversible and high consequence — the decisions that justify serious analysis, wide consultation and time.

The two characteristic errors are symmetrical and both expensive: applying heavy process to reversible decisions, which makes an organisation slow; and treating an irreversible commitment casually because it felt routine.

Who decides

Ambiguity about decision rights is one of the largest sources of organisational delay. For any significant decision type, establish: who decides, who must be consulted, who is informed, and what escalates.

A useful rule: decisions should be made at the lowest level with the necessary information and context. Escalation upward adds delay and frequently subtracts information, because the person deciding is further from the situation.

A basic decision process

1. Define the decision. What exactly is being decided, by when, and what does a good outcome look like? A surprising proportion of difficult decisions become straightforward once the actual question is stated.
2. Establish the criteria before examining options, and weight them. Defining criteria afterwards means they are shaped by the preferred option.
3. Generate genuine alternatives. Fewer than three usually means the choice is being validated rather than made.
4. Gather the information that would change the decision, and only that.
5. Evaluate against the criteria, including risks and second-order consequences.
6. Decide, and record the reasoning and the assumptions.
7. Communicate the decision and the reasoning to those affected.
8. Review the outcome against the expectation.

Recording the reasoning

Writing down why a decision was made, and what was assumed, costs minutes and is disproportionately valuable. It allows the decision to be revisited when an assumption changes, prevents the same debate recurring, and — importantly — permits honest learning, because it records what was actually believed at the time rather than what hindsight suggests.

Indecision

Not deciding is a decision, and usually a worse one: the situation continues, options close, and the organisation waits. Where a decision cannot be made, the honest response is to state what information is needed, who will obtain it and by when, rather than allowing it to drift.