Making decisions

Here's the next part of our series on leadership skills...

There's an ongoing trend in organisations at the moment for decisions do be made further down the organisation where appropriate. As a leader, you’re going to need to take decisions, either alone or with others, so you’ll need to techniques in this section to ensure your decision is a strong one.

The Impact-Ability matrix
This is a particularly helpful tool to take the subjectiveness out of making decisions. It helps you to take an unbiased view by considering two elements:

  1. The impact your chosen path will have on the team, organisation or problem.
  2. How easy it will be to action the decision once made.

The matrix is a simple 4-box grid:

You plot your options on the grid according to the two axes, then you select the option(s) nearest to the top-right corner as your “good ideas” to take forward.

Identifying risks
So you’ve made your decision… except you haven’t tested it at all to check for problems.
A major consideration for many managers and leaders at the moment is management of risk. People, particularly senior leaders, what to know what could go wrong (and any actions to mitigate the risk) before taking any actions or making any investment in pursuing an idea.

There are 2 steps to working with risks:

  1. Identifying the risks
  2. Responding to the risks

Once you’ve thought through anything that could go wrong as a result of the decision you’ve made, you need to think about options to address those. Plot your risks on the grid by:

  • Probability:    Likelihood of the risk taking place
  • Impact:    How problematic if would be if it did take place

Then, use the appropriate response from the grid:

  • Transfer:    Transfer the risk to someone else, through using contractors or insuring.
  • Avoid:        Change your decision to avoid the risk being able to happen.
  • Mitigate:    Make changes to reduce the probability and impact.
  • Accept:    This is a low-importance risk – just keep an eye on it.

In real life, not every risk will be suitable for every response, so if the response shown by the grid isn’t appropriate for your particular risk, use one of the other approaches.

Looking for unexpected negatives
Finally, before finalising your decision, you should look for any unintended negative impacts from the decision you’re making. This is different from risks, as they’re known quantities which will definitely happen, rather than unpredictable events.

To do this, you should consider negatives in 4 areas:

  1. Employees
  2. Customers
  3. Suppliers
  4. Strategy

So there you go, you're now fully equipped to make decisions as a leader!


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