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The 5 Step Method for Making High-Stakes, High-Quality Decisions Fast

You should never have to choose between speed and quality.

By fizkes/Shutterstock
By fizkes/Shutterstock

Long ago, business leaders accepted the notion that they must sometimes “go slow to go fast” when it comes to making big strategic decisions about their thorniest problems. Like the tortoise and the hare, the traditional idea was that slow and steady wins the race: If you don’t rush into key decisions and instead take the time to plan carefully and thoroughly, you’ll eventually beat others who are racing forward without care. 

That may have been true in the past — but “go slow to go fast” is a recipe for disaster in today’s world, where the pace of change is exponential. You can’t afford to be the tortoise today, because the hare isn’t taking a nap anytime soon.

A recent McKinsey Global Survey proves this point. When it comes to decision-making, McKinsey found that a majority of respondents say that much of the time they devote to decision-making is used ineffectively, and only 20% reported that their organizations excelled at decision-making. Most organizations make trade-offs between speed and quality of decision.

Most importantly, the survey found that organizations that excel at decision-making also make high-quality decisions fast. They don’t compromise speed for quality, or vice versa. The notion that you’re either a “slow and steady” tortoise or a “fast and reckless” hare is a false choice. The McKinsey report provides evidence that your decision-making process can be both fast and high-quality.

Traditional approaches to high-stakes decision-making take too long, cost too much, and don’t deliver quality or impact commensurate with the investment of time and resources. So for organizations, finding new approaches that yield quality decisions fast has to be a top priority.

How to make good decisions

McKinsey analyzed the winning organizations to reveal a few principles of good decision-making. They are:

  • Making decisions at the correct level of the organization
  • Focusing on enterprise-level value
  • Ensuring relevant stakeholders are committed to execution
  • Ensuring quality of discussions and debate
  • Employing a robust process for running decision meetings

However, while the report makes clear what you need to do, it doesn’t provide instructions on how to do it. So, let’s take a stab at those instructions. Here are five things you can start doing today to implement these principles and improve your organization’s ability to make decisions fast — all without sacrificing quality. 

1. Making decisions at the correct level of the organization

How: Clearly identify who has decision authority, and give them access to whomever else they need to inform the best decision.

When it comes to high-stakes decision-making, the right people with the relevant knowledge, experience, and stake must hold ultimate decision authority, so they can make, act on, and own the results of the decision (and this sometimes means delegating down). It should ultimately be their decision to make, and they should also be given access to whomever else they need to come to that decision.

The “whomever else” is critical. These people will fill in key the gaps so that there is what’s called requisite variety — the necessary and sufficient perspectives, ideas, expertise, thinking styles, and demographics. This might include head-office functions, front-line staff, new hires, known cynics, influencers, partners, customers, outside experts, etc.

2. Focusing on enterprise-level value

How: Clarify the question to be answered, put enterprise-level value into the question, and identify the right mix of people who can best answer the question.

Before you make a big decision, frame it as a question that emphasizes enterprise-level value — a measure of a company’s overall value. For example, consider a tool manufacturer that sells hammers and nails in Walmart, and also sells more sophisticated tools and services to construction companies directly. The question “How can we optimize growth in our retail business unit?” might lead to decisions that jeopardize pricing in business-to-business sales. On the other hand, the question “How can we optimize while maximizing overall enterprise value?” demands answers with balanced outcomes.

Use that question to identify who must make up the requisite variety group. When that happens, you directly involve a much larger group of people in the decision — even a few who don’t obviously have a direct personal stake in the decision and wouldn’t usually contribute (like people from other business units or geographies). Those people extend the boundaries of the decision — for example, from retail to retail plus B2B —and bring a more balanced enterprise focus to the discussions. It also holds those with decision authority accountable for keeping an eye on the overall value of the decision to the enterprise, so that they are weighing all the right factors.

3. * Ensuring relevant stakeholders are committed to execution

How: Give all key stakeholders a genuine co-creative role in the decision.

All key stakeholders must be represented. As a result, requisite variety might steer you to a group of twenty or more people. Gather them in one place for two to three days. Don’t give them decision authority, but do ask them to have frank and collaborative discussions about all key angles of the decision, and develop a list of specific actions the company should take.

Once the group has decided what they think the company should do, ask them what they will commit to doing themselves. This will drive ownership and accountability beyond those with decision authority, so that there is a network of doers and champions ready to go when the decision is made.

4. Ensuring quality of discussions and debate

How: Use progressive iteration, behavioral roles, and neutral scribes to manage the decision-making process.

Bring everyone together in one place for a two to three day meeting, and break the time up into three rounds of discussion.  In the first round, encourage people to tell stories, express anger and frustration, and describe what they see happening from every angle. Make it okay to gripe and flounder. This first round is about getting everyone on the same page about what the status quo is.In the second round, ask people to generate as many ideas as possible about what they could do. Don’t let them draw conclusions or make recommendations yet.

In the third round, ask the group to look at all the ideas they developed in the last round, and narrow it down to a list of specific, action-oriented recommendations. Progressing from round to round is key to getting the best answers from individuals and the group, because it allows people time to think, explore assumptions and alternatives, and adjust their position without forcing anyone to concede to the will of the group.

In each of the three rounds, assign every person one of three behavioral roles — member, critic, or observer. Members own a given discussion, critics listen to members and get a few opportunities to critique what’s happening, and observers do no more than listen during that conversation. If you have a group of 20 people, that means assigning eight people to discuss the topic as members, with six people offering critiques, and the last six observing. Switch up the assignments in each of the three rounds so everyone has a chance to be in each role.

Have a neutral scribe document everything so that an unbiased account of the ultimate recommendation and its rationale is captured and shared.

5. Employing a robust process for running decision meetings

How: Develop a well-designed process for decision meetings so that you aren’t leaving a critical organizational capability to chance.

It must be fast. The process should take no more than two or three days to yield the right answers and to position those making the decision with all they need to make the best one. Any less time than that and people won’t have time to share their perspectives, change their position, and align collectively on the right answers; but any more time than that and you’re into diminishing returns on people’s valuable time.

Takeaway

In this age of urgency and complexity, you don’t need to choose between slow and steady or fast and reckless. There are mature, straightforward ways to make high-stakes, high-quality decisions fast. Twenty percent of organizations are already doing so. Those who aren’t yet can learn to excel at decision-making, move faster and better, and truly differentiate themselves and their organizations.

Note: If you are interested in a more in-depth analysis of McKinsey’s findings, and our instructions on how to make better decisions, you can download our white paper, “How to Make Faster Decisions a Competitive Advantage.”

Originally published on Business Insider.

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