Decision making has many aspects to it, one of them being the philosophical or ethical one. If you for example consider the intention behind the made decision being the most essential aspect you belong to the Immanuel Kant’s school of thought whereas if you consider the outcome the only thing that matters you believe in utilitarianism.

Translating this into business terms this means either evaluating the quality of the process or the quality of the outcome. Both are in fact important and neither should be disregarded. Learning from the past is essential with regards to both.

There are five main aspects to consider when evaluating the overall quality of a decision:

1. Decision Quality

Measuring the quality of the available alternatives and information as well as the commitment and timing of the decision. Often time a decision fails due to the latter, the matter is simply decided upon after deadline. Another factor to consider is if the decision has resulted in a tradeoff in the company and personal values.

2. Situational Analysis

Some examples of a situational analysis are weather the decision involves organizational and analytical complexity. This means if there are many different stakeholders involved and if the needed data is available or not. Another example is weather the decision relates to a new area for you or if this is in fact your area of expertise.

3. Results

In this section you can measure both hard and soft values. On the one hand, evaluating the impact, urgency, or relevance of the decision and on the other hand, assess the mood or dialogue among the participants. Taking the time to do this and over time getting data on you overall results in different areas is extremely valuable to improve as a decision maker.

4. Risk Assessment

In finance it is obvious that a thorough risk assessment is key but in fact this goes beyond decisions about investment. It is always a good idea to assess the likelihood and severity of failure of a certain decision and do the relevant scenario planning to avoid the worst case.

5. Evaluating efforts vs results

A simple matrix with result in relation to efforts evaluating the success of a decision. Simply, ask your team members or the relevant people for this decision to put a post-it with their name on a flip chart with the axes result (low – high) and effort (low – high). The preferable outcome is to have a low effort with a high result. This way you get a great overview of the team’s performance.

Simply asking a few questions to yourself and the involved people with regards to these five core areas will result in a remarkably better decision making process and outcome over time. It is highly recommended to take the evaluation of decisions as a best practice in organization. Good luck with your decision making! Or will you even need luck if you learn from your mistakes?

Frequently asked questions:

1. How can I apply the five aspects of decision quality to a specific decision scenario in my organization?
   To apply the five aspects of decision quality (decision clarity, information quality, mental models, commitment to action, and tracking), start by identifying a specific decision scenario within your organization. Consider factors like the decision’s impact, stakeholders involved, and available resources. Then, assess decision clarity by defining the problem, objectives, and criteria. Ensure information quality by gathering relevant data and analyzing it objectively. Use mental models to explore different perspectives and potential outcomes. Commit to action by setting clear implementation steps and timelines. Finally, track progress and adjust as needed.
2. What are some best practices or tools to conduct a situational analysis, a risk assessment, and an effort vs result evaluation?
   Conducting a situational analysis involves understanding the context, including internal and external factors. Consider SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis, PESTLE (Political, Economic, Social, Technological, Legal, Environmental) analysis, and Porter’s Five Forces model. For risk assessment, identify potential risks related to the decision and evaluate their likelihood and impact. Use tools like risk matrices or decision trees. When evaluating effort vs result, quantify the resources (time, money, personnel) required for implementation and compare them to the expected outcomes. Prioritize decisions that yield higher results relative to effort.
3. How can I collect and analyze feedback from the relevant stakeholders on the decision quality, speed, yield, and effort?
   Engage relevant stakeholders throughout the decision-making process. Seek feedback on decision quality, speed, yield, and effort. Use surveys, interviews, or focus groups to gather insights. Analyze the feedback to identify patterns, areas for improvement, and alignment with decision goals. Adjust your approach based on stakeholder input to enhance decision quality and ensure buy-in.

Pick up another useful piece of Decision Making knowledge from our new blog post: Decisions make or break knowledge work.

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