For far too long, business leaders have treated decision making like a mystical art, an arcane instinct hidden in our guts. Yet decision making drives business performance and employee engagement, and unlocks the business value of diversity. So why the mystique?
The reason is simple: Businesses don’t measure decisions made across their organizations the way they measure everything else. And so they fail to manage decision making in a systematic way. Because decisions are neither measured nor managed, decision making is stuck in the realm of anecdote and intuition. But this is all about to change.
As businesses take decision execution management seriously, business performance, engagement, and diversity will improve faster than any previous period in business history.
Unpacking Decision Execution Management
Decision execution management, or DXM, is the practice of tracking, communicating and measuring decision making in a systematic way. It treats decision execution as a critical business process that must be managed much like businesses manage customer relationships, marketing campaigns, product development, human resources and other operational processes. And because decision making is at the core of leadership, decision execution management augments leaders, much like customer relationship management augments sales people.
Today, businesses measure results in the form of profits and pipelines. But because businesses don’t track the decisions that led to those results, no one really knows the who, what, when, why and how behind their successes and failures. We end up with tons of data, few correlations and no causes. That’s no way to run a business.
That’s also no way to lead a business. This lack of management insight means we lack provable understanding of why decisions are made, and so we can’t effectively coach current or future leaders to improve their decision making. The result: We regularly delay decisions and fail to involve diverse perspectives. We don’t empower employees to make decisions at the right level. We communicate decisions sporadically and forget why decisions were made in the first place. Businesses are flooded with data, and yet when it comes to the process of decision making we are still adrift on a sea of speculation and guesswork.
There Be No Dragons
We do so little concrete, objective measurement of decision making that most executives assume it must be impossible to do. I hear this all the time: “We move too fast, we could never keep track of all the decisions we make.” In fact, it only seems that way because no one is keeping track of decisions in a systematic way. Since decision making is at the edge of the map, we assume there must be dragons.
There are no dragons. Each week a business leader makes one significant decision and a handful of smaller decisions that are worth tracking and communicating. It feels like a lot more than that because ineffective processes frequently delay decisions by weeks or months, and so leaders at all levels are left juggling a mind-boggling backlog of decisions.
But if you record and manage decisions like everything else we manage in business, that backlog gets a lot less boggling. Try tracking your decisions next week and notice the difference:
- What was decided and why?
- Who was involved and what choices were considered?
- What results are expected and who needs do what by when?
Decisions get made faster, and stay made until the context changes. Communication happens. More things get done because people are more committed. That is what effective leadership looks like.
And once decisions are tracked, they become data to be measured. What gets measured gets managed. And that is how DXM changes the game entirely.
The Power Of Changing The Game By Keeping Score
When leaders measure decision making, the soft measures of business judgment, empowerment and diversity become hard measures of decisiveness, decision making participation and decision alignment that can be used to compare the decision execution of leaders and their departments.
- Decisiveness = Number of decisions meeting expected results in a given time period
- Participation = Percentage of employees involved in decision making
- Alignment = Percentage of decisions that impact key business goals
Decisiveness means quickly making decisions that achieve expected results. Decisiveness can be measured by simply tracking how many decisions were made last month, and how they turned out. And the power comes when you compare the decisiveness of departments, regions and people over time, and give leaders decision framing, workflow and communication tools to act on the insights. Is decisiveness in the marketing department down this month? Are the European field offices as decisive as North America? Is an engineering leader making all the decisions for her team, or is she delegating decision making across her organization? Are employees empowered to make decisions at the right level? DXM changes the game by providing hard answers to these previously fuzzy questions. And because decisiveness today drives performance in the future, these measures are like radar, highlighting problems long before they appear in traditional backward-looking business metrics.
Decision making participation means involving people in the company’s most important activity. This benefits employees because involvement in decision making drives half of employee engagement, and it benefits companies because bringing diverse perspectives to bear on decisions drives significantly better decision making. Participation also easy to measure and manage when decisions are tracked. How long does it take new hires to get involved with decision making in engineering? Is sales participating in relevant marketing decisions? Are women in North America involved with more decisions than their female colleagues in Asia? DXM systems make it possible to answer these questions objectively, and help drive improvements by lowering the complexity of involving the right people while speeding up the decision making process.
Alignment means making decisions that align with stated business goals. This requires slightly more sophisticated decision measurement, but the result is like x-ray vision into the behavior of an organization. That is because measuring decisions directly measures human behavior - in effect, decisions are the actions people take to make goals happen. Is marketing sufficiently focused on revenue? Is engineering actually prioritizing customer value? Are managers in New York working to improve employee engagement? Again, DXM turns these fuzzy questions into hard answers, and provides decision framing tools to guide decision priorities so leaders can get out in front of problems before they surface at the next monthly update, quarterly business review or annual employee survey.
Given the importance of decision making, it’s not surprising that research shows profound results when decisiveness, participation and alignment improve:
- Decisions are made twice as fast
- 75% of decisions result in better choices
- Employee performance improves 20%
Keeping score by tracking stats like these also has dramatic impact on leadership behavior, especially combined with easy-to-use software systems that augment and directly manage the decision making process. These forward-looking decision execution measures are more predictive of future business performance than profit and pipeline, an important consideration for boards and investors. They have broad effects since they affect leaders at all levels across all departments and industries. And when leaders are measured, their competitive instincts motivate them to improve and win.
Empowering Wallflowers and Aiming Loose Cannons
When companies directly track decision processes and results, they create new and faster feedback loops to drive corrective action. This makes companies more innovative and competitive, as emphasis expands from collecting and analyzing information in real time to cutting weeks off the human time required to act on that information. And this intense environment demands that companies manage and develop a smart, action-oriented leadership culture across the employee spectrum. In effect, decision execution management helps by improving the decision making behaviors of all employees so they are on par with today’s top performers.
All companies have large numbers of employees who tend to sit on the sidelines of decision making, like wallflowers at a dance. Unfortunately for today’s meeting-driven organizations, often hold back in meetings. They may be more junior or lack confidence to take risks, less forceful and charismatic, or not properly motivated. Rather than think of this as the natural order, a decision execution management strategy sees these people as underutilized perspectives when decisions are being made, under-engaged resources when a bias for action is required, and underdeveloped future leaders. Thus DXM specifically aims to make it easier for employees to be more decisive and reduce the time investment and complexity of involving more people in decision making, while also providing measures of decisiveness, participation and alignment to drive improvements.
On the other end of the spectrum are the loose cannons - confident, charismatic, motivated people who want the limelight and agency of decision making but who may lack the skills or experience required to manage risk and consistently deliver expected results. Their aggressiveness cuts both ways. Like peacocks, they command attention, and at worst may get promoted beyond their abilities. They may also fall prey to a form of tall poppy syndrome, getting passed over for positions or promotions in favor of more tractable employees, especially if they are less experienced, geographically remote or demographically diverse. A DXM strategy tempers these future leaders with systematic best practices to enforce a broader perspective, aligns their decision making with company goals, and uses hard measures of their decision making to correct mistakes quickly.
DXM puts critical measurements in place to give executive insight into decisiveness, participation and alignment. It also creates workflows and collaboration processes designed using the science of cognitive bias and human behavior to improve decision making, guide corrective action and close the feedback loop. That gets wallflowers out on the decision dance floor, makes sure loose cannons get pointed at the right targets and levels up decision making across the organization.
What Is Your Strategy?
Decision execution management is in the early days. But given the importance of decision making, and the utter lack of systematic measurement in business today, it will inevitably transform the practice of business. It’s time to start thinking about your company’s DXM strategy:
- Where does your company make repeated business decisions today? These are high leverage areas to focus early DXM efforts. Sales and partner opportunities, product and marketing priorities, engineering and IT processes, hiring and evaluating talent are good examples.
- What strategic initiatives are in place to improve productivity, collaboration and company culture? Putting hard measures on soft initiatives has a big impact. Decisiveness, engagement and diversity improve rapidly using DXM practices and systems.
- Who are your transformational leaders, your innovative executives who want to get in front of the transformation rather than be passed over? They are the DXM champions who will lead their organizations to change their decision making behavior, and thus set themselves up to lead your company to success on an even bigger stage.
DXM is a simple idea with a huge business impact - if you manage decision making systematically, you can improve it systematically.
To learn more about decision making can change your business, download our free white paper on Decision Making, Not Faking, written by renowned futurist Stowe Boyd. Ready to get started?Get a Cloverpop demo -- it's the ultimate online tool for DXM success.