DJPR | Online Residence

Decision Quality in Organizations: First Day of Class…

First Day of Decision Quality in Organizations course

Last Thursday, I’ve completed the first section of Stanford’s “Decision Quality in Organizations (XSDR120)” (DQO) class. DQO is of one the core courses for Stanford’s “Strategic Decision and Risk Management” certificate program, which is offered both online and offline.

DQO is one of the six courses I’ll be taking to complete the certification program this year. Indeed, I’ll be in on campus at Stanford later this June to take “Enterprise Risk Management” and “Strategic Portfolio Decisions.” So if you’ll be in the area, let me know.

Thus far, the DQO course has been very interesting. As is often in business-related classes, the concepts are straightforward even perhaps seemingly obvious. Yet, what is difficult – and why I’m taking these courses – is to have that mental shift from “oh that seems obvious” when I read about these concepts in HBR to a whole other level: internalizing these ideas, making them a habit, and have applied understanding of them (via reviewing case studies).

The DQO course, and probably most of the program, is heavily visual. The course itself came, not only with your standard textbook, but with a +400 slides covering many key concepts in illustrative charts of various sorts.

In the first section, there were alot of “big ideas” generously shown through dozens of PowerPoints and conceptual charts. I’ve picked out three ideas that I found especially illuminating in helping me better under decision making process.

1. Organizational Complexity v. Analytical Complexity

As in often the case, a B-Grade Strategy with an A-Grade Execution is far better than vice-versa. The DQO instructors showed a four-quadrant chart with a Organizational Complexity/Analytical Complexity axis. The four quadrants were: Quick Decisions – low OC/low AC, Facilitative Leadership – high OC/low AC, Decision Analysis – low OC/high AC, and Rigorous Decisions – high OC/high AC.

What caught my eye was “Facilitative Leadership”, which has been a style of leadership I have been increasingly reading about form various Get-Things-Done (GTD) blogs to the Harvard Business Review as the prime example of leadership.

It is not always possible for the leadership to have access or understanding to all of the data and analysis available to the organization (low quantitative analysis). Thus, “Facilitative Leadership” is about maximizing other people’s contribution (high organizational complexity) to the organization and decision making process.

2. Decision Quality Spider Chart

The most readily actionable concept I found was the “Decision Quality” spider chart. It was a simple spider chart to measure the overall team’s confidence that a decision has been made with the proper evaluation of:

1. Framing the Issue
2. Alternative Routes
3. Reliable Information
4. Clear Values/Trade-Offs
5. Logical Reasoning
6. Commitment to Action

I have a “Project Management” cheatsheet I bring to meetings to make sure that goals, responsibilities, follow-up process are decided before a meeting ends. I’m definietely adding this as another cheatsheet to quickly evaluate decisions made.

3. Advocacy-Based Decision Making v. Dialogue Decision Process (DDP)

One basic concept is that decision-making based on advocacy turns the whole decision making process into a lobbying effort. And like all lobbying effort, your job is to advocate only on that position, thus most likely presenting both biased information and neglecting alternatives.

In contrast, the dialogue-process promotes both the decision makers and the project team a stake in the decision. It allows for a process to understand the context & requirements, evaluates the decision, consider alternatives and outline the planning.

As someone who is part of a growing company, I definitely feel that I need to mentally shift from advocacy-based to dialogue-based decision planning.

Admittedly, I have been unsophisticated and for some time made internal decisions based on “hey we should do this” gut feelings. While Gladwell (of Blink) places values on gut feelings, it is no way to help be apart of a growing company: 1) the decision quality is poor and not rigourous; and 2) organizationally it does not promote decision holder’s buy-in.