Decision making isn’t
the only job of a manager. In fact, according to management
guru Peter Drucker, managers--at any organizational level--don’t
spend a great deal of time making decisions. Decision making
is, however, a specific managerial task and has far-reaching
consequences attached to it. When a manager makes a good
decision, it often seems that few people ever notice; on
the other hand, bad decisions are routinely remembered for
years to come. Therefore, it’s imperative that managers
recognize the mistakes to avoid in decision making. Twelve
of the most common errors made by managers are de-scribed
in the following paragraphs.
1. Failure to recog-nize a problem. Too often, managers
operate on a frantic, day-to-day basis without realizing
that a problem exists. They may have a nagging thought that
something is amiss, but they may also seem resigned to the
fact that things are this way because of the “system”
and that someone else--externally or internally--will take
the necessary positive action to change what’s wrong.
When this becomes their mindset, managers abdicate their
responsibilities. Any time schedules present obstacles or
operations don’t run according to plan, a manager
should suspect that a problem exists. It’s incumbent
upon the manager to take action and aid in resolution of
2. Incorrect problem identification. Proper identification
of the problem is the next step in effective decision making.
This step is also the most difficult because symptoms are
often mistaken for real problems, and effects are often
confused with causes. Symptoms and effects are mistaken
for the problem because, as a rule, they’re more obvious.
Problem-solvers attack obvious irritants not only because
they’re apparent but also because of the environmental
pressures within which decisions are made. Because managers
often operate within a dynamic environment, time always
seems to be one of their chief adversaries. Thus, the obvious
alternative offers less resistance. Any decision that fails
to deal with the real problem or doesn’t address the
source of difficulty is, in effect, a bad decision because
it will most likely produce an unsatisfactory solution.
3. Insufficient consideration of alternatives. For any
problem that confronts a decision-maker, there are probably
at least three (and maybe more) alternative solutions. Failure
to think through the alternatives exposes a manager to the
risk of overlooking a sound, practical decision. Thinking
through alternatives means not only expanding one’s
mind to generate ideas--”thinking outside the box”--but
also considering possible repercussions that may arise by
selecting each alternative: the unsought consequences of
a course of action. Decision making requires careful thought
as well as investigation beyond the obvious.
4. Inadequate evaluation of risk. Every decision should
be evaluated in terms of costs and benefits or in terms
of risks involved and possible results. Failure to do so
often produces high-cost, complex solutions from which the
payoff is minimal. When considering costs vs. benefits,
a manager has several methods available to handle risk so
that the most effective decision is made for a given situation.
These methods include avoiding the risk by seeking less
risky solutions, reducing the risk by training employees
properly and eliminating risk through insurance or hedging--where
possible. If the decision-maker evaluates risk systematically,
a more educated decision will follow.
5. Repetitive decisions. Many managers handle the same
problem over and over, making decisions in each instance
on a case-by-case basis. Recurring problems can be more
efficiently and effectively resolved through the development
of policies, procedures, rules and regulations. If a manager
lacks authority to initiate standing plans of this nature,
he or she should refer the recurrent problem to someone
higher up in the organization who can develop such solutions.
6. Unnecessary decisions. “Fools rush in where angels
fear to tread” is an old saying that offers sound
advice where decision making is concerned. Occasionally
the problem confronting a decision-maker is of such a nature
that the best action is to do nothing but simply watch and
wait. Although few problem situations are likely to improve
on their own, there’s always the possibility that
they won’t deteriorate any further either. To take
action in such a case may only subject a manager to unnecessary
risk--risk that could be avoided through an “action
through inaction” strategy. Because, as pointed out
earlier, every decision entails risk, it’s important
for managers to know when to take risk and when to sidestep
it. However, when the “no action” approach is
used, a manager must continue to observe the situation and
take action if further developments merit it.
7. Delayed decisions. There is no evidence to support the
contention that decisions improve with age, that the longer
a decision is put off, the higher the quality of the eventual
decision will be. Fast decisions--not snap decisions--have
at least two advantages. First, an expeditious decision
gives a manager more time to correct a situation should
the original decision prove to be the wrong decision. Second,
a quick decision allows a manager to move on to other problem
areas requiring his or her attention.
8. Lack of follow-up. Every decision should be followed
through to see if the decision is producing the expected
result. Not every decision is going to be as effective as
it was first believed. Consequently, the decision-maker
must always monitor the situation to determine if things
are working according to plan.
9. Ignoring input from others. Decision-makers commit a
crucial error when they fail to seek and consider input
from others, especially employees actually involved in performing
the work. Those closest to the problem often know what’s
required to solve it and are willing to provide their thoughts,
if only someone would ask.
Discussions with others at the same level, if the organization
is large enough, or with managers in other organizations
are often useful in providing input for problem analysis
and decision making.
10. Using the same solutions to solve different problems.
All too often, managers think that any problem can be solved
by throwing enough people and money at it. Decision-makers
must recognize that each new problem should be approached
without a preconceived notion of how to solve it. Different
problems will require different solutions.
11. Insufficient data collection. When a problem occurs,
a manager may grab the few facts at hand or limited information
that is readily available and base a solution on this limited
research. In many cases, the collection and analysis of
additional data might suggest an entirely different approach
to solving the problem. A decision-maker should always ensure
that enough information has been collected and analyzed
to make an intelligent decision.
12. Shooting from the hip. One of the greatest temptations
in problem solving and decision making is to make a snap
decision. Such hastiness frequently results in decisions
that miss the mark, backfire or create additional problems,
thereby costing the organization additional expenses. The
trick is acquiring the skill of making a quick decision
that correctly considers the situation rather than one that
is rapid but off the mark. This skill can be learned and
developed by analyzing each decision made.
Although decision making is not the only job of a manager,
it’s an important task and most certainly one for
which managers will be long remembered should they “blow
Praise seems to be rarely accorded to the manager who
renders an effective decision. Perhaps that is because everyone
believes that managers are paid to make good decisions.
Bad decisions, on the other hand, have been known to create
legends such as aviator Douglas “Wrong Way”
Corrigan in the 1930s or the newspaper that in 1948 declared
Thomas Dewey president of the United States.
These mistaken decisions will live forever. Few managers
can tolerate such infamy. In order for managers to place
themselves in the best position to make effective decisions,
they should recognize the mistakes to avoid in decision
making and take action to preclude poor decisions.
Donald L. Caruth has a doctorate in management from
the University of North Texas. He is a Senior Professional
in Human Resources, an accreditation conferred by the Society
for Human Resource Management. Caruth is also a consultant
in management development and compensation.
Gail D. Handlogten has a master’s degree in
human resources and training from Amberton University. She
is a Senior Professional in Human Resources and is co-author
of Managing Compensation (Quorum Books, 2001). Handlogten
is a consultant in human resources.