Guiding Teams to High-Quality Decisions

Decision Leadership
Guiding Teams to High-Quality Decisions in
Challenging Organizational and Analytical Contexts

Meet Today’s Speakers

Hannah Winter Bruce Judd Carl Spetzler Jennifer Meyer Paul Marca
Partner, SDG Dir. of Executive CEO, SDG Senior Engagement Deputy Director,
Education, SDG Program Director, SDRM Manager, Executive Stanford Center for
Associate Program Certificate Program Education Practice, SDG Professional
Director, Stanford Adjunct Professor, Development
Strategic Decision and Kellogg Graduate Lecturer in Economics,
Risk Management School of Mgmt. Stanford Graduate
(SDRM) Certificate School of Business
Program

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© 2007 Strategic Decisions Group www.sdg.com

When the stakes are high and organizational
alignment is difficult, you need decision leadership.
High stakes
• A bad decision will have lasting negative consequences
• There is time to make a high-quality decision

Multiple parties
• Stakeholders
• Information providers
• Individuals who will ensure the decision “sticks”

Examples
• New business strategy
• New products or services
• Response to competition
• Management of a portfolio

In general these situations are challenging organizationally, and they are
analytically complex, uncertain, and dynamic.
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These challenging situations call for decision
leadership to ensure a timely and high-quality result.

Decision
Maker(s)

Decision Leader

Decision Task Leadership
Planning and Managing
Gathering Information
Facilitating Meetings
Analyzing & Synthesizing
Communicating Results

The decision leader plans and in many cases leads the tasks preceding the decision; in
some cases the roles are combined.

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Live Meeting Poll
Poll 1

What role do you play most frequently in your
organization's decision making?

• I am the decision maker or a member of a standing decision-
making body.

• I solve problems and advocate my ideas to decision makers.

• I lead teams to support decision makers.

• I participate on teams that support decision makers.
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Effective decision leaders are committed to achieving
decision quality.
Decision Leader

Decision leaders provide five essentials. They:

1. See the destination – a high-quality decision

2. Diagnose a decision situation

3. Design an effective and efficient decision process

4. Lead the decision process

5. Assess the level of quality achieved

They start with the end in mind, and assure that it is achieved.

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Achieving quality in each of six elements produces
quality in the overall decision.

Meaningful,
Reliable
Information

Creative, Clear
Doable Values and
Alternatives Trade-offs

Elements of
Decision
Quality Logically
Appropriate Correct
Frame Reasoning

Commitment
to Action

Like a chain, overall quality is no stronger than the weakest link.
This is the goal of the decision-making process. 6
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A “spider” diagram helps gauge decision quality.

Meaningful, Clear Values and
Reliable Trade-offs
Information

Creative, Logically
Doable Decision
Correct
Alternatives Quality 0% 100%
Reasoning

Appropriate Commitment
Frame To Action

The 100% point is where additional effort costs more than it is worth. 7
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Effective decision leaders diagnose the situation in
order to determine the best decision process.
Decision Leader







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The decision leader asks the crucial questions: the
“What,” the “When,” and the “Who.”
• What is the decision?
– What is our purpose in deciding?
– Has a decision been “declared”?
– How important is the decision?
– What is the nature of the decision?
– What makes this decision difficult?

• By when does this decision need to be made?

• Who should be involved?
– Who decides?
– Who knows (who has the content that we need)?
– Who leads the decision process?
– Who should be involved to assure success in implementation?

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A diagnosis of the situation results in an initial frame.

Meaningful,
Clear Values and
Reliable
Trade-offs
Information

Creative, Logically
Decision
Doable Correct
Quality
Alternatives Reasoning

Appropriate Commitment
Frame To Action

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What makes diagnosis difficult? Each decision has its
own nature.
Organizational: Alignment and commitment
to a direction
• Fundamentally different frames and beliefs
• Group dynamics
Organizational

• Values, desires, and motivations
• Habits and personalities
• Organizational structure

Co l
nt
en tica Analytical: The logic to get the right answer
a ly
t An • High uncertainty
Content: Trustworthy inputs and insight
• Complex dynamics and business cycles
• Data overload or lack of data
• Many interdependent drivers
• Constantly evolving value chains and
business models • Multiple, interrelated value measures
• Many alternatives or none • Variability in risk attitudes
• Biases
• Access to expertise
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Who should be involved?

Decision Maker(s) Has authority to approve action.

Responsibility for
Assures that the decision recommendation meets DQ criteria.
Decision Quality

Gathers content information, facilitates dialogue, analyzes
Project alternatives, and integrates results to achieve clarity of direction
Team and commitment to action by the decision maker(s) and the
implementers.

Provide facts and judgments necessary to understand the
Input and Execution
consequences of the decision and readiness for successful
Resources
execution.

Typically the decision leader directs the project team and shares DQ responsibility with
decision makers.
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Effective decision leaders select an approach and
create the project plan: the “how” of achieving DQ.
Decision Leader







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Live Meeting Poll
Poll 2

How does your organization make most of its important
decisions now?

• We use decision leaders to guide dialogue among decision makers
and team members to a high quality decision.

• Our most important decisions are based on recommendations by
strong advocates.

• Our decision-making processes are ad hoc.

• I don't know how we make our most important decisions.

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In complex decisions, we define separate roles for
decision makers and a project team.
Decision Board
Members: Decision-makers
Responsibilities: “Declare” decision, approve frame,
provide values and trade-offs, and
make decision
Selection criterion: A decision by this group will “stick”
Decision Board

Project Team
Members: Analysts and subject-matter
experts
Responsibilities: Develop frame and alternatives,
assess information, evaluate
alternatives, plan implementation
Project Team
Selection criterion: Recognized by decision board as
credible experts and analysts
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The tried-and-true SDG decision process is a good
place to start the process design.

Staged Process Driven Creation of a
Declare & with Deliverables Clear Choice

Assess Create
Evaluate Decide
& Frame Alternatives

Diagnose

Decision Board

Systematic Dialogue
among the Right
Participants
Project Team

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The approach, tools, deliverables, and schedule differ
greatly from one situation to another.
Organizational

Co
nte l
nt tica
al y
An

Consumer Product Assess & Frame
Alter-
Evaluate Decide
Market Entry natives

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Organizational

Co
nte l
nt tica
al y
An

Alter-
Evaluate Decide

Semiconductor Assess Alter- Alter-
Evaluate Evaluate Decide
Capacity & Frame natives natives

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Organizational

Co
nte l
nt tica
al y
An

Alter-
Evaluate Decide


Mobile
Assess Alter- Alter-
Provider & Frame natives
Evaluate Decide
natives
Evaluate Decide
Strategy
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However, all approaches, deliverables, and schedules
must drive to commitment to action that achieves DQ.

I
A V
Organizational

DQ
F R
C
Co
nte l
nt tica
al y
An

Alter-
Evaluate Decide


Mobile
Assess Alter- Alter-
Provider & Frame natives
Evaluate Decide
natives
Evaluate Decide
Strategy
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The decision and task leaders select from myriad
tools to achieve decision quality.

Content Intensive
• Brainstorming
• Market studies
• War gaming
• Experts
• Customer interviews
• Focus groups
• Pilots and prototypes
• Trial clinics
• Controlled launches
• Competitor review
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Organization Intensive

Content Intensive • Surveys

• Brainstorming • Team building

• Market studies • Competency
assessments
• War gaming
• Learning systems
• Experts
• Experts
• Customer interviews
• Personality
• Focus groups assessments
• Pilots and prototypes • Organizational design
• Trial clinics • Personal coaching
• Controlled launches • Needs mapping
• Competitor review • Incentives and rewards
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Content Intensive • Surveys Analysis Intensive
• Brainstorming • Team building • Multiattribute scoring
• Market studies • Competency • Scenarios
assessments
• War gaming • Value/uncertainty maps
• Experts • Spreadsheet modeling
• Experts
• Customer interviews • Sensitivity analysis
• Personality
• Focus groups assessments • Probabilistic analysis
• Pilots and prototypes • Organizational design • Nonlinear optimization
• Trial clinics • Personal coaching • Risk profiling
• Controlled launches • Needs mapping • Options and gaming
• Competitor review • Incentives and rewards • Dynamic systems
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• Portfolio analysis

The key is selecting appropriate tools for the nature
of the decision situation.

• Brainstorming • Team building • Multiattribute scoring
assessments
• Experts
• Personality
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Example: A business portfolio problem…


• Brainstorming • Team building • Multi-attribute scoring
assessments
• Experts
• Personality
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Effective decision leaders orchestrate and lead the
activities necessary to achieve DQ.
Decision Leader







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Decision leadership applies up, down and across the
organization.

Decision
Maker(s)

Decision Leader

Decision Task Leadership

There are often different decision leaders for different decisions across the organization.

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The decision leader often has overall project
leadership responsibilities.

Project Team
Decision Board

For the decision maker(s), the leader: For the project team, the leader:

• Knows the larger organizational context • Is recognized and respected by the project
team members as the director of the effort
• Keeps a finger on the pulse of the decision
makers, maintaining open communication • Designs and oversees the team’s activities
to build decision quality
• Monitors changes in the decision situation,
and knows when to change course • Monitors progress in the decision effort and
knows when to change course
• Synthesizes insights from the team’s work
clearly and with incisiveness • Ensures quality of the team’s work products

• Manages resources and schedule
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Skillful leaders employ different leadership styles,
depending on the situation.

Decision Stage Potential Leadership Styles*
Visionary: “We have an important problem here.”
Declaring and diagnosing the
Democratic: “We need engagement of many different
decision
perspectives in this process.”
Assessing and framing the Visionary: “We can reach alignment for this decision.”
decision; Understanding values Affiliative: “Our goals can support each other.”
Visionary: “We can think differently about this.”
Generating alternatives;
Assessing information Coaching: “Each team member and expert can help us
move toward higher decision quality.”
Pacesetting: “This is challenging and exciting work.
Evaluating alternatives to Here’s a clear set of tasks that will get us there.”
understand value and risk Commanding: “We have a crisis. Here’s what needs to
happen.”
Reaching decisions; Democratic: “We all need to be aligned.”
Building consensus Visionary: “With this decided, here’s what’s possible…”

* Styles defined by Goleman, Boyatzis, and McKee in Primal Leadership: Learning to Lead with
Emotional Intelligence (2002) ®
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An essential skill for decision leaders is facilitating
dialogue in decision meetings and workshops.

Decision Dialogues

Objective Leading dialogue that yields commitment to
a high-quality decision
Decision Board

Project Team Meetings
Objectives Designing and developing work products to
build decision quality and foster alignment

Project Team

The decision leader will often design, open, manage, and close each meeting.
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The decision leader designs the meeting to fit the
tasks and participants.

Decision Stage Potential Meeting Designs
• One-on-one discussions and draft reviews
Declaring and diagnosing the
• Kickoff presentation by decision makers
decision
• Team development or refinement of vision statement
Assessing and framing the • Small group info review and summary of challenges
decision; Understanding values • Issue raising with diverse perspectives in the group
• Individual idea generation and group brainstorming
Generating alternatives;
• Creative expansion, e.g., role plays, challenge reviews
Assessing information
• Individual interviews using debiasing techniques
• Interactive development of model structure
Evaluating alternatives to • Poster session of evaluation results
understand value and risk • Small group synthesis of key evaluation insights
• Large group review and prioritization of refinements
Reaching decisions; • One-on-one preview of results and recommendations
Building consensus • Insight-focused dialogue and recording of agreements

A good design will accommodate different personality types (e.g., introverts,
extroverts, big thinkers, analytical types, etc.)
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The decision leader manages meetings with neutral
facilitation and facilitative leadership.

Neutral Facilitation Facilitative Leadership

• Encourages and manages • Expert in leading a decision-making
balanced and healthy discussion process

• Keeps the group on task and on • Guides the group through specific
schedule; seeks group agreement decision-related tasks
on changes in task or schedule
• Ensures quality of the work product
• Adapts meeting process when it from each meeting
isn’t working
– Manages meeting tasks to
maximize quality contribution
• Manages group interactions, but
provides no technical content or – Challenges the team in the meeting
judgment of quality if quality is lacking
– Tasks the team to improve quality
as needed after the meeting

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So, in summary, decision leaders efficiently drive
organizations to high-quality decisions.

I
Decision Leader V
A
DQ
F R
C






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Live Meeting Poll
Poll 4

How much would your organization benefit from improved
decision leadership?

• Little Benefit - We already have a group of effective decision leaders.

• Some - Meetings and workshops would be more efficient and
productive.

• Significant - Decisions would be transparent and higher quality.

• Monumental - This could be transformative for our organization.

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Stanford University and SDG have created education
programs focused on improving decision-making.

Stanford Center for Professional Development (SCPD)

• Directed by Professor Ron Howard, Management Science and Engineering

• Developed in partnership between SCPD and Strategic Decisions Group

• Available online, on campus, and on-site

• Meets the career-long education needs of professionals, managers, and executives

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Our program comprises education for strategic
decision-making at two levels.

• Certificate program in Strategic Decision and Risk Management
– For leaders and senior managers who want to
improve decision-making by their teams
– For those who support strategic
decision-making
– On-campus sessions in March, June,
and September
– What past participants have said:
- "Stanford opened my mind to a
new way of thinking that made a
significant impact on me personally.”
–Xander Uyleman
- Watch an exclusive interview with Xander:
http://scpd.stanford.edu/scpd/about/ourStudents/xUyleman.htm
• Two-day senior executive seminar
– For senior executives with significant decision responsibility
– November 13–14, 2008
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The certificate program offers 2.5-day courses
spanning the breadth of decision staff skills.
Strategic Decision and Risk Management (SDRM) Program Core course

Elective
Decision
Leadership Behavioral
New course
Challenges in
Strategic Decision-Making
Innovation

DQ Advanced
DA Decision Converting
Modeling SDRM Project
for Strategic Decision Quality Practicum Strategy into
Insight
Analysis Action Management
Program
Advanced
Decision
Analysis Enterprise
Risk
Strategic Management
Portfolio
Decisions

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2008 On-Campus Calendar

March June
Monday Tuesday Wednesday Thursday Friday Monday Tuesday Wednesday Thursday Friday

17 18 19 20 21 16 17 18 19 20

Decision Analysis Advanced Decision Analysis Strategic Innovation

Converting Strategy Into Action Decision Quality in Organizations Converting Strategy Into Action
24 25 26 27 28
CORE ELECTIVE

Behavioral Challenges in
Decision-Making
Decision Leadership

Pricing
September
• $2,495 per course
Monday Tuesday Wednesday Thursday Friday
• $2,245 per course – early
8 9 10 11 12 registration (register by
Decision Quality In Organizations 5/11/07 for June)
Enterprise Risk Management Decision Analysis
• $2,195 per course – multiple
Converting Strategy Into Action Strategic Portfolio Decisions courses
15 16 17 18 19
• $1,975 per course – multiple
courses and early registration
Strategic Decision and Risk
Modeling for Strategic Insight Prices increase January 8, 2008
Management Practicum
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Thank you for
Q&A
participating in
today’s eBriefing,
the winner of the
iPod Shuffle is…

To contact one of today’s speakers:

Hannah Winter Bruce Judd Carl Spetzler Jennifer Meyer Paul Marca
hwinter@sdg.com bjudd@sdg.com cspetzler@sdg.com jmeyer@sdg.com pmarca@stanford.edu
+1.650.475.4455 +1.650.475.4470 +1.650.475.4405 +1.650.475.4374 +1.650.723.4008

To learn more about the SDRM program:
sdrm_reg@scpdinfo.stanford.edu
1-866-234-3380
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Upcoming On-Campus Courses

March 17 - 28, 2008

Stanford Strategic Decision
and Risk Management
Certificate Program
Register at: http://proed.stanford.edu/redir.asp?J1

To visit the SDRM home page: http://proed.stanford.edu/redir.asp?J3

For more information, please contact:
Patty Harris, Customer Relationship Manager
Toll Free +1 866 234 3380
Outside the US +1 650 475 4490
pharris@sdg.com
http://strategicdecisions.stanford.edu

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Guiding Teams to High-Quality Decisions

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