What you need to know to make better decisions

A common cause of frustration in communicating with others is the difference between logical and values-based decision makers.

Logical decision makers (like Mr Spock in the original Star Trek series) need sound reasoning to be the basis of their well thought through decisions. They remain distant from the impact of their decisions and take a helicopter view of the situation. It makes sense to them that each topic and decision is treated as a black box with inputs and outputs. Events create data which is then fed into the black box for the decision making process. It’s logical Captain Kirk!

On the other hand; values or feeling based decision makers (like Oprah) see the feelings, emotions and the people involved in the decision. They want to make sure that their values are taken into account; that what is important is considered and that the impact on people is minimal. They have a close, personal and short term view of a situation. They feel strong empathy with those who may be impacted on by a decision and will take a stand if their values are not respected.

The two extremes characterised by Mr Spock and Oprah are just that – extremes on the thinking-decision making continuum. Most of us can make rational decisions; most of us can make empathetic decisions. When we get stuck or inflexible in only one mode of thinking or decision making then our decisions can be suspect and are open to question.

Recently in Australia a publicly listed manufacturing company made a very public announcement that it had decided to close down all its Australian factories and move its production operations offshore. This is a rational dollars based business decision. They looked at the numbers, the cost of manufacturing vs. the cost to manufacture offshore. A simple logical rational decision was made. On paper the decision is a good one, and long term will probably pay dividends to the shareholders.

The CEO got a massive pay rise - also announced quite publicly.

Unfortunately for that company’s board they missed the values based aspect of their decision making.  The cost to the various communities of the job losses; the impact on the buying public of an “Iconic” brand being manufactured offshore. The public outcry and media braying for blood was instantaneous.
The weakness of the decision was exposed like a cancer under a surgeon’s knife.
Sales dropped, market share dropped; the “brand” was damaged.

Strong and robust decisions need to take into account both the data, the logic and the potential people and values impact. Importantly too the communication processes also need to take these aspects into account.

An executive coaching client is looking at closing down part of his business right now. It has been haemorrhaging money every month for a few years. The division to be closed has over 60 employees.
My client knows he has to down-size/right-size and retrench staff. All logical sensible decision making says close down the division. He also knows there are going to be 60 families losing their primary income. In one country town he is a significant employer so he will be impacting on a whole community. He knows all this and is making a mutually logical and values based decision and importantly he is communicating both.
Part of his decision making process looked at the impact  on his staff and their communities - so he is actively seeking a buyer for his business who can run it profitably as part of an overall growth strategy for their business. Part of the purchase negotiations is that the new owner interviews all current staff with a view to recruiting as many as possible. He is supporting current staff to into new jobs outside of his industry. He is minimising the impact of the closure on the people as much as he humanely can.

Whether you are writing a will; making a financial plan; buying a house; buying a car; setting up or closing down a business or choosing a school for your children; you can look at the facts and be sensible and logical in your decisions & how you communicate them, or you can look at the impact and the underpinning values in the decision, or you can do both.

Our most robust decisions will involve looking at the logic and making sure that we take into account what is important as well.

Using the Myers Briggs Personality Test shows us which type of thinker/decision maker is our natural preference. This knowledge gives us the awareness to shift and use our less preferred thinking mode when making important decisions so that we look at both sides and make our decisions stronger. When we are not able to shift our thinking the knowledge we have also us to invite someone who is strong in an opposite preference to provide an input and ideas. Again this substitution makes for more flexible and more robust decisions.