Effective 'Goldilocks' Decision Making

Effective 'Goldilocks' Decision Making

Successful CIOs use “just right” processes, organizational structures and communications to create an environment in which good IT decisions are made and executed

In IT, we all make lots of decisions: What tools to buy, who to hire, what to invest in. Decisions are often complex and politically sensitive, involving a large number of stakeholders. Decision making therefore is rarely as simple as just running the numbers and coming to the right answer because "right" is relative. Good decision making recognizes that each decision has two body parts: a head and a heart.

The head runs the numbers. Analytical and fact-based, head issues employ proven processes to reach reliable outcomes. They are rational, repeatable and fair. As Barry Beracha, a former CEO of US-based Sara Lee Bakery Group, once said: "In God we trust. All others bring data." The problem is, on their own, head issues are hopelessly inadequate for anything but the simplest of decisions.

That's where the heart comes in. Heart issues encompass experience, gut feel, judgement and the desire for fair and equitable outcomes. Often trading political capital and power to demonstrate or demand loyalty, they expose hidden alliances and mutual aggression. Heart arguments hinge on trust and giving people time for debate. Careful timing - knowing when to pose a question and suggest a solution - makes a big impact on the heart.

Effective decision making combines the best of head and heart to produce reliable and timely outcomes. An environment for effective decision making comprises three key elements:

Process | A systematic series of actions that is both familiar to stakeholders and repeatable serves as the backbone of decision making. With too much process, nothing ever gets decided. With too little process, none of your stakeholders will support you.

Structure | A standardized list of the stakeholders to involve in each type of decision serves to flesh out the process backbone. With too little structure, no one knows who is involved and accountable. Have too much, and death by committee ensues.

Communications | A program of messages serves to bind together process and structure by informing stakeholders about decisions under consideration, providing a conduit for civil debate on contentious issues, synchronizing activities and keeping the decision-making process moving forward. Surprisingly, too much communication reduces information dissemination to the point of unwelcome noise and is just as bad as too little when no one knows what's going on.

Getting to a Goldilocks decision-making process. "Goldilocks" was a golden haired child involved with three bears in the eponymous fairy tale: Goldilocks and the Three Bears. In this tale, little girl Goldilocks enters the home of a bear family while they - mother, father and baby bear - are out. She explores their home, finding the mother's and father's things too this or too that for her (usually two extremes, like porridge that is either too hot or too cold); but everything that belongs to the baby bear is "just right".

In our approach to decision making, "just right" is also what we are seeking to achieve. A Goldilocks decision-making process achieves the right balance between rigour and cost.

The journey to Goldilocks processes begins with diagnosing existing decision-making practices by asking yourself: Are we producing good decisions now? Are our decisions timely? Does our enterprise respect the defined processes, or have they been replaced with ad hoc processes?

Depending on the findings of this soul searching, you can then address over- or under-engineered steps. For example, if you determine that you are not making the right decisions and outcomes are not aligned with business priorities, then this could be for two reasons: either because a mechanistic process is in use that does not add value to decision making (such as a bureaucratic nightmare), or little reference to business priorities is made during decision making.

To address these issues, introduce a change to your process so that it supports evaluation of initiatives using both objective and subjective criteria that align with business strategy. This will address the inflexibility problem by encouraging subjective assessment. In addition, it will address the lack of reference to strategic business priorities by formalizing the criteria as part of the decision process.

Exceptions happen, however, so it's worth planning for them. A circumstance can arise where a quick decision is needed. A decision that at first glance looks like it is low impact can suddenly turn into a much bigger deal. Or, a left field issue emerges that does not fit the established decision approach.

Frequently, exceptions processes use informal stakeholder communications to reach a decision with ratification coming later using the standard process. Those enterprises with good decision processes document exceptions and modify their standard processes to accommodate the conditions that gave rise to the exception.

Some decisions also may have a bigger impact on the enterprise. A process that properly distinguishes these differences in impact creates a more effective decision-making environment.

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