Business Case Studies, Executive Interviews, George Wright on Decision Making

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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.

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  • Would fostering dissent (a constructive dissent) lead to a better decision-making? Does conflict lead to better decisions? Or would it be an unqualified hindrance to decisionmaking?
    Dissent is very valuable but has to be managed and structured. One method I use is to divide the management teaminto two halves at random and assign each half a role. The role of one of the halves is to present a recommendation on a strategic issue and the second half of the team's role is to critique it the devil's advocacy approach. Another way I use is to ask each team to present contradictory proposals. At the end of each set of role-plays, I facilitate the opposing halves to come to a unified set of recommendations. This set of recommendations is invariably judged by the participants to be of high quality.

  • Who according to you would be the best-ever decision-makers in corporate history? What traits did they exhibit?
    I have to pass on this one. As I said, the key is a good decision process not, necessarily good decision outcomes in the short-run. Since Universities and the Church are amongst the longest-lasting organizations then I believe that the processes within each are worth studying. Democracy, also, tends to be long-lasting and so felt-fairness may be an important component of longevity.

  • In today's corporate environment executives are often not willing to be so decisive, as they fear mistakes and the resulting fallout.At the same time, there is zero tolerance for indecision, lapses in integrity, and, above all, weakness all of which can be career ending. How should executives/ leaders engage in a (delicate) balancing act of decisiveness and indecision; overconfidence and insufficient confidence? Would anticipatory regret hinder decisiveness?
    The key is that good decision processes do not necessarily result in good outcome in the short-term. Imagine that I offered you a bet: A coin is thown in the air and it either lands 'heads' or 'tails'. If it land 'heads' I will give you $10 and if it lands 'tails' you will give me $8. Also, to take part once in the bet you must pay me $1. How many times would you take part? Many people say that they wouldn't take part at all reasoning that they could lose $9. For those who would take part, most would only take part a few times reasoning that they could be many dollars down after a few throws of the coin. But, rationally, you should play the bet asmany times as you are able since each gamble has a positive expectation of winning 50 cents. Of course, in the short run, you could lose many hundreds of dollars but in the long-run you would become infinitely wealthy. Think about it! Obviously, it all depend on the degree of loss that you could bear in the short run but the general principal holds true the success of decision making should be viewed over the long-run. Most people are, however, conservative they are loath to take a risk in the short-run and so rule-out longer-terms gains!

  • What is the role of business schools in preparing better decisionmakers? What specific steps do you suggest for business schools in terms of designing their curricula and delivering focused courses to prepare better decision-makers?
    The key, to me, is to show how decision aiding techniques can challenge intuition and facilitate improved decision-making. These techniques can range from the numerical decision analysis, resource allocation models, multiattribute value analysis, risk analysis to the behavioral decision conferencing, scenario planning, devil's advocacy, dialectical inquiry. Decision-making courses should focus on what goes wrong with individual and group-level decisionmaking and then show how to put things right using a mix of numerical and behavioral techniques, as appropriate.

  • What kind of decision-making capabilities is required for different industries? After all, an FMCG's CEO needs to make a lot quicker decisions than either a steel company's CEO or a cement company's CEO.
    I think that the issue has to do with the degree of turbulence, and also opportunity, in the business environment facing an organization. A small organization can take calculated gambles to give it the edge. A larger organization tends to seek stability and is more like a supertanker that is hard to turn into a different direction. The supertankers need advanced radar systems like scenario planning that enable them to see the waters well ahead. The supertankers need these systems because of the inertia in the forward momentum, i.e., the current business success formula of the organization. In fact, most of the applications of scenario planning have been in businesses where infrastructure investments are major such as the oil and airline businesses.

  • How do you think the leader's personal ethics, emotional quotient and value system play a role in effective decision-making?
    To me what is called 'procedural justice' is the key to a successful, forward-thinking, organization. By procedural justice I mean that everyone who has a view on a decision should get 'air-time' to put his or her view. By air-time I mean a truly listening audience of higherlevelmanagers. This air-time needs to be structured by the use of an experienced facilitator who is empathetic with small group dynamics. Recall, as I said earlier, that the basis competitive advantage of an organization lies in the individual heads of its managers. The key task for the leader is to tap into that resource and to do so requires a respect for the viewpoints of others. Also, if an individual manager feels that his/her viewpoint has had airtime than that manager feels valuable and is more likely to play a subsequent positive role in the organization. In my view, the act of listening is a key leadership attribute in today's flat organizations!

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