Decision-making is an art


According to a study of 376 real-life business decisions, managers tend to use decision-making tactics that are the easiest -- and, consequently, the least successful.

The study, conducted in 1998 by Ohio State University researcher Paul Nutt, found that only 50 percent of decisions made by persuasion -- in which managers cite the benefits of a change in order to influence others to adopt it -- were adopted by the organization. Worse yet, only 38 percent of decisions made by edict -- where managers don't collect input from others -- were adopted.

Surprisingly, Nutt found that the top managers he interviewed for the study relied on these two techniques the most -- turning to them 49 percent and 30 percent of the time, respectively.

Instead, Nutt suggests that managers should look to two different techniques when making decisions: participation and intervention.

Participation involves having all affected parties play a role in the decision-making process. This was successful in 80 percent of the cases that Nutt studied, although top managers used it only 13 percent of the time.

The other successful option, intervention, involves establishing standards or expectations for performance, usually by making comparisons to similar organizations. Then, a team's performance is measured against those standards. When there's a gap, managers work to find justifiable ways to close it.

Without a doubt, intervention takes time -- and that's one reason why only 8 percent of top managers used the technique in the cases studied. But, given that intervention is successful 90 percent of the time, more managers might want to start setting aside some time to give it a try.

From the Software Development Magazine, May 2005, by Amit Asaravala.

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