On one of the WA groups of HR, Administrator of the groups has raised a topic for discussion. Today's topic is on Decision-making
. He has asked the following questions:
Should decisions pertaining to organization and employees be taken arbitrarily or judiciously?
What would be the implications or benefits if decisions are taken arbitrarily?
I have given replies to the questions. These are as below:
The replies to your questions are as below: Introduction
: - Factors that limit the decision making process are as below:
a) Inadequate information
b) Time and constraints on amount of information that can be gathered.
c) Perception of decision makers about relative importance of data.
d) Human memory.
e) Calculating capacities associated with intelligence Collective Reply
: - While taking decisions, there is no scope of taking arbitrary decisions. But then is there any person who admits readily that his/her decision was arbitrary? Following questions distinguish between arbitrariness and judiciousness of a decision:
f) When the decision will be evaluated, how will it be evaluated when it will be evaluated, who will evaluate it and on what parameters will be evaluated. These are the most primary questions. Those who consider these questions, are the real leaders.
g) Whether Cost Benefit Analysis (CBA) was done before taking a decision? If yes, what were the parameters?
h) Whether the culture of evaluation exists in the company? In many organisations, leaders take just take decisions and then justify the decision. They do not maintain any records on the circumstances the decision was taken. This gives the room for evaluation. Sometimes the objectives of the decision are defined vaguely. This vagueness always benefits decision-maker to save his/her face.
i) If the decision involves financial investment then whether investment appraisal tools like IRR, ARR, NPV or PBP was used while taking decision? If in the past such tool was used then does the leadership does evaluation after certain years as to what was projected IRR and what is actual IRR?
j) Many times leadership show plain capriciousness. Scientific decision making is always a casualty with this kind of leadership.
k) There are various types of biases that impact the decision making process? Did leadership try making itself aware what are those biases and how to keep decision free from such biases?
Thanks, Dinesh Divekar 16th March 2018 From India, Bangalore