Magazine article Management Review

TWO STAGES of Decision Making

Magazine article Management Review

TWO STAGES of Decision Making

Article excerpt

NAME: John Rau President and CEO COMPANY: Chicago Title Corp., Chicago, Illinois LINE OF BUSINESS: Title insurance NUMBER OF EMPLOYEES: 10,500 REVENUES: $2 billion WEB SITE:

For years I've heard management "experts" exhort CEOs to be counselors, coaches, role models, communicators and ambassadors. According to these experts, decision making is something to be delegated. This is an illusion.

As a CEO, I make decisions all the time. My own decision-making process travels through two stages.

The first stage concerns where I should spend my time. These are the most important decisions I make, and I base them on four key considerations: delegation dimensions, difficulty, data and due date. Only when I complete this stage do I know if I must continue with the decision-making process myself.

The need for delegation is obvious, but a more subtle question is whether it would provide subordinates with an opportunity to grow professionally. Is this a chance to do some coaching that will help someone broaden his or her perspective? Can I improve buy-in by including the people who will end up doing the implementation in the decision-making process?

The degree of difficulty also affects delegation. What are the long-term consequences of the decision? Is it reversible?

How much is based on experience, intuition and other intangibles? If it is heavily based on these factors, it is less likely that I can delegate. Then I look at the data. Is there a clear data-based model that can drive the decision making? If so, I can consider delegation unless there is a high degree of difficulty or low reversibility. Finally, I look at the due date to consider both the benefits of timeliness and the price of delay.

When I've completed this first stage, I know whether or not I can delegate the decision making. If I can't, I move into stage two, where I "work the problem." This stage has seven steps:

* Look for analogies. The most fertile ground is other companies or industries that have faced similar circumstances and pressures. The fundamental laws of economics, production, financial processes and human behavior and interaction do not change from company to company or industry to industry. Reading about other companies makes me a better decision maker because it provides a store of analogies.

* Let data and impressions flow. …

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