Executive Interviews: Interview with George Wright on Decision Making
May 2008 - By Dr. Nagendra V Chowdary

George Wright
Professor of Management at Durham Business School, UK.

• You have undertaken a wide range of consultancy and workshop-based assignments in scenario thinking and decision analysis for a variety of public and private sector organizations in the EU and beyond, including clients like HBoS, Petronas, the Jordan Ministry of Planning, the Scottish Football Association, etc. You have also recently authored three books two on decision-making and one on scenario planning. In all these years of teaching, consulting, and authoring experiences, what have been your major propositions on decision making? Have they changed over the years?
  I used to believe that management science techniques like decision analysis could aid decision-making to become more rational but, with experience, I now feel that irrationality and flawed decisionmaking are commonplace. The fact is that poor decisions, once made, get made to work such that the initially poor decision is no longer obvious to observers! I think that top management teams can be trapped by pitfalls in their decision-making. Decisions, once made, are seldom reversed even when the stream of incoming information shows an initial decision to be wrong-headed. Biases like overconfidence and search for evidence that confirms the validity of the earlier decision are commonplace, in my experience. Also teams of managers tend, over time, to become cohesive and feel invulnerable in their decisionmaking. Additionally, poor decisions tend to be rescued by the commitment of additional resources to turn a poor decision outcome around just look at the major computer projects that go wrong good money often follows bad!

• One of the books you wrote was, Strategic Decision Making: A Best Practice Blueprint. When does decision-making become strategic? What parameters define the quality of a decision?
  Any decision that is not easily reversed is strategic. Also keeping major options open so called realoptions thinking are often strategic. I guess that, in the end, all big decisions are strategic! A good quality decision may result, by chance, in a poor outcome. Good decisions are evidenced by a good decision process that involves information search, the weighing of uncertainties and values, and the exercise of good judgment. And there are decision aiding tools around that can help both individual managers and top teams make great decisions based on judgment. These techniques challenge judgments and decisions that are formed early in the consideration of a decision. Often, decisions are both challenged and changed by these decision aiding techniques. Changed intuition is a measure of a high-quality decision process.

• What, according to you, are the similarities and dissimilarities between an individual, managerial, executive, societal and governmental decisions?
  I think that all decisions whether personal or institutional can be analyzed in the same way. Even family decisions involve different stakeholders spouse, children and have both financial and nonfinancial consequences. Institutional decisions are similar but perhaps the political processes in institutional decisions are more complex but, there again, maybe not!

• Are there any tools/mathematical models/decision trees, etc., that the students are taught?
  There aremany tools that I and others teach to MBA students and use in consulting assignments. Some tools are mathematical but all use, to some degree, human judgment. Even the forecasts of econometric models are routinely subject to human adjustments to take into account variables that will have an impact of the target forecast variable but which the forecaster knows are not part of the econometricmodel. There are also behavioral tools that structure the interaction of top teams such that ideas can be challenged without some individuals losing face by being challenged. Scenario planning is a well used method to challenge business as usual thinking. It does this by helping top teams construct alternative but yet plausible scenarios of the future in which the organization must survive or better still thrive!

• Is decision-making a science or an art? If it is to believed as science, can its principles be applied universally? If it is an art, how can someone be trained to be an effective decisionmaker?
  In my view it is a mixture of art and science. The science comes for the availability of normative tools like decision analysis that can specify soundly-based decisions. But the input for the analysis subjective probabilities and payoffs come from the heads of the managers and these inputs can only be judgmental. As I said before, the best decision aiding techniques both challenge and change intuition.

• To trust employees and to allow them to make decisions, particularly without all the pieces to the puzzle is anathema in business today. What is the appropriateness of participatory decision-making and unilateral decision-making? In what kind of industries/circumstances, do you think each of these approaches serve a better purpose?
  To me, the major resource of the corporation is the intelligence held in the minds of the managers and workforce. The key is to tap this, often untapped, resource. Contained within this resource is the major competitive advantage of the corporation. But often individuals do not listen to one another people defer to the most dominant figure in the hierarchy. But good judgment does not necessarily reside at the top of the organization especially if the leader has been leader for some years. As the business environment changes, the thoughts of the old leadermay not and few will tell him or her so! It follows that true leaders should relish challenge to their judgment and decisions. This is especially true when you consider that of the Fortune Global 500 organizations only 50% last longer than 50 years. Interestingly, the Universities are one of the longest lasting of institutions and Universities are all about challenge and debate!