Leaders to Leader

Lessons from the Great American Leaders & How They Apply Now

Posts Tagged ‘standards

Measure What Needs to Be Measured

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Performance plans are action plans, not static documents. Effective performance plans must detail the specific actions leaders and employees must follow to accomplish the goals and objectives set within it. Leaders understand that without meaningful performance standards, measuring and evaluating individual performance becomes difficult if not impossible. Once the plan is implemented, meaningful performance standards allow leaders to modify and adapt their plans to actual conditions.

Leaders must use solid standards to monitor and evaluate all aspects of performance. Any measurement used should determine and create an action both on the part of the employee being evaluated and on the part of the leader performing the evaluation.

There is a natural tendency for a leader to focus his or her activities on more prominent areas that will be highlighted and spotlighted, yet every element of the performance plan must be fully addressed.

It should be noted that any standard a leader creates will direct, limit and change the behavior and performance of their employees. This is important for leaders to understand because what and how they choose to evaluate can have either a positive or negative effect on the performance of their organizational unit.

A common pitfall in establishing performance standards is overdoing them. It burdens all involved with excessive factors and controls. Leaders know that to be effective, they need to set performance standards that are relevant and meaningful. It is far better to have fewer meaningful standards than to establish many useless ones. When applied, these standards will present a true picture of the performance of their organizational unit at any given point in time. Four areas to focus on in creating meaningful performance standards are:

What to Measure

The specific elements that need to be measured will vary by organizational unit. Typically, performance standards are set around productivity and profitability. Most leaders establish performance standards by setting specific performance expectations. Examples include:

  • Progress is evaluated by the reaching of specific milestones linked to individual goals and objectives.
  • Profitability is evaluated against the budgets established for each activity.
  • Efficiency is evaluated by the resource utilization within the organizational unit.

Each organizational unit has key factors that determine their success. Leaders identify these factors as indicators of performance and look for trigger points that are early indicators of the success or failure of these factors. For instance, if a leader is managing a manufacturing unit, he or she may focus on projected orders as a key indicator of their unit’s future activities. While a production supervisor may not be interested in these future indicators, a leader looks beyond the immediate horizon to maximize the efficiency of their unit.

How to Benchmark

Once leaders know what they want to evaluate, they need to benchmark each critical measurement. This establishes degrees of confidence and reliability in their numbers. They review these statistics over a meaningful period of time to establish a benchmark of past performance in each area. The longer a leader reviews the past performance of a specific area, the higher the degree of confidence and reliability he or she establishes.

Once key performance standards are benchmarked, leaders establish “triggering events” that result in taking immediate action. Since the benchmarked statistic is the standard, a triggering event can be predetermined. This event or “flag” occurs when performance rises above or falls below a specific percentage of the benchmarked standard. This provides leaders an early warning system to proactively deal with performance problems before they get out of hand.

How Frequently to Measure

Leaders are careful not to overburden themselves with needless information. They use performance standards as a means to keep their finger on the pulse of their unit’s performance. They can easily determine the frequency for receiving reports of their unit’s performance. Some statistics are meaningful on a daily basis, some hourly, and still others only when reported over prolonged periods of time.

What Measurements Indicate

Key performance standards need to inform leaders of the overall performance of their organizational unit. Specific measurements can trigger corrective actions, while others indicate the progress of the unit against performance plan goals and objectives. Effectively utilized, solid performance standards lead and direct the leader’s actions to fine-tune his or her unit’s performance. The right balance of key standards points the way to improved overall performance and productivity.

Excerpt: Planning to Maximize Performance: Pinpoint Leadership Skill Development Training Series (Majorium Business Press, Stevens Point, WI, 2011) $ 16.95 USD

Related:

Five Critical Steps to Maximize Performance

Execution: Six Action Steps

Performance Plans Create Results and Maximizes Performance

Objectives Allow Managers to Focus on Obtaining Results

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Seven Practical Applications of Ethics

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manatangle

An organization and each of its employees, wherever they may be located, must conduct their affairs with uncompromising honesty and integrity. Business ethics are no different than personal ethics and the same high standard applies to both. As a representative of their company all employees are required to adhere to the highest standard, regardless of local custom.

Everyone is responsible for their own behavior. We live in a culture where responsibility and accountability are minimized, with individuals hiding behind the label of “victim” as an excuse for their actions. There is right and wrong, black and white, but many would prefer to operate in shades of gray. As long as they do not cross the line, they feel that they are fine. As long as no one catches them, their behavior is acceptable.

Individuals operating in shades of gray feel ethics are not as important as the legality of their actions and think the ends justify the means. After all it is a results-driven environment and it is the results that matter.

While certain actions might be legal, they may also be unethical and reflect poorly on an organization as well as the individuals responsible for them. If these actions are tolerated and allowed, an organizational culture is created that undermines the customer’s confidence in the company, as well as its products and services and ultimately destroys its reputation in the marketplace.

Allowing even a single unethical activity can pull a thread that ultimately unravels the cloth of an organization. Actions have consequences and unethical actions and their consequences can have a rippling effect within a company. If all employees understand this and apply it to their actions and the actions of their colleagues, it will result in a stronger company. Both the company and an employees’ ongoing employment within it require compliance to this philosophy.

Ethical behavior cannot be legislated. It is a combination of strong values and the impact of the example set by peers and superiors. To better appreciate ethics, individuals must understand how the following factors interact with each other to impact their actions, behaviors and decisions:

Values

Values are the principles or standards of personal behavior. Most values are shaped early in life by parents, families, friends, teachers and spiritual leaders. As individuals mature, their values can be changed or biased by their experiences and the choices they make in life. Specific examples of sound values include honesty, integrity, trustworthiness, fairness and a sense of justice.

A primary value possessed by most individuals is acknowledging the difference between what is right and what is wrong. How one acts on this knowledge is the core of both value-based and ethical behaviors.

Norms

Norms are the guidelines or guiding values that define behavior in specific situations. Norms governing employee behavior can be formed by organizations, informally created by groups, or established by individual values. Some examples of organizational norms include:

  • Every employee is 100% responsible for their behavior.
  • Ethics are ethics.
  • There is no difference between business and personal ethics.
  • Ethics are critically important in both business and in life.
  • Employees are expected to act ethically 100% of the time.
  • Whether they will be discovered or not, employees must always do the right thing.
  • There are leadership obligations, which include giving clear direction and teaching fellow employees by example.
  • It is an employee’s obligation to keep those they supervise acting ethically.
  • Employees are expected to stop unethical acts, even if they think it will jeopardize their job.

Convictions

A conviction is a firmly held belief or opinion and can include one’s values, beliefs, corporate values and norms. A company’s strong ethical program relies upon employees’ uncompromising belief or conviction in “always doing the right thing.” This underlying conviction is the foundation for success.

Integrity

Integrity means acting unbiased by self-interest and within the framework of one’s values and norms. One of the most generally accepted norms of organizational behavior is that an individual’s private interests or desire to benefit personally should not influence how they carry out their responsibilities. An employee is corrupt when he or she damages the company by deriving personal benefits and gains from their decisions and actions.

Choices

Ethics is the collection of values, norms, standards and principles that provides a framework for action. Action requires individuals to make choices. Ethical choices often create personal dilemmas, where decisions may conflict with one’s personal values and beliefs. The bottom line in ethical behavior is determined by the individual choices one makes in both their business dealings and in their personal lives.

Ethical choices and decisions are unquestionably difficult to make. Some may impact profitability, employment or even personal relationships. The dilemma often lies in defining “the right thing,” which is not always obvious. This often involves determining and weighing the various consequences specific decisions will have on the problem or situation. Ethical decision making is further complicated by all involved parties emotionally arguing their positions. Emotional arguments are subjective and tend to charge the decision making environment. The right choice or “the right thing” will be an objective choice free of emotionalism. Once identified, the decision should be straightforward.

Courage

It takes courage to be ethical in the current cultural environment. Ethical decisions can be unpopular because of their impact on both the company and other employees. They can be stressful because of a fear of retribution or reprisals within the company and from others.

Courage must come from the uncompromising convictions, values and beliefs supported by an organization’s ethical philosophies and reinforced by the belief in “always doing the right thing.”

Behaviors

Integrity or ethical behavior is guided by each of the factors discussed within this lesson including values, norms, convictions, integrity, choices and courage. None is independent of the others and each supports the others. They are what define your behaviors as either ethical or unethical. Together they provide you with the guidelines that define your behavior.

Excerpt: Business Ethics: Pinpoint Leadership Skill Development Training Series (Majorium Business Press, Stevens Point, WI 2011) $ 19.95 USD

Related:

You Are Judged by the Actions You Take

Emotional Bonds are a Reflection of a Leader’s Effectiveness

Six Ways to Enhance Your Personal Credibility

 Can You Be Trusted? The Answer May Surprise You

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

The Four Building Blocks of Intelligent Decision-Making

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Decision-making is a cognitive process leading to the selection of a course of action among alternatives. Whether an action or opinion, every decision making process produces a final choice.

The decision making process begins when an action needs to be taken, but one doesn’t know exactly what to do or where to begin. The reasoning process can be rational or irrational, with most decisions based on explicit or implied assumptions.

Building Block One: Applying The Principles of Decision Making

Judiciously applying specific decision making principles will more often than not make the difference between taking effective or ineffective action. These principles help ensure that all involved stay focused on their specific work-related duties as well as the overall objective the company is pursuing.

When it comes to effective decision making, paying close attention to the organizational universe is not optional, but critical. The attributes contributing to good decisions can translate directly into tangible benefits when applied to the broader framework of business-related operations. Each decision made should serve as a learning experience, whether or not it proves wise.

How is an effective decision made? Maintaining an understanding of the basic role of one’s organization can support thoughtful planning and processes for decision making objectives, which tend to justify the future course of the company.

There are 10 basic steps to follow when a decision has to be made. These include:

  1. Identify the purpose of the decision. What exactly is the problem to be addressed and why does it need to be solved?
  2. Gather information. What factors does the problem involve?
  3. Identify principles with which to judge the alternatives. What standards and judgment criteria should the solution meet?
  4. Brainstorm and list a wide variety of possible choices.
  5. Generate as many likely solutions as possible.
  6. Evaluate each choice in terms of its consequences, using predetermined standards and judgment criteria to determine the pros and cons of each alternative.
  7. Settle upon the best alternative. This becomes much easier once the above steps have been undertaken.
  8. Translate the decision into a specific action or plan of action steps.
  9. Carefully execute the plan.
  10. Evaluate the outcome of the decision and subsequent action steps. Within this process it is important to identify the lessons learned. This is an important step for further development of more effective decision making skills and judgment.

Building Block Two: Creating an Objectives Hierarchy

The first step in the process is to identify the purpose of the decision making effort: What is the problem and why does it need to be solved?

In order to achieve this end it is important to generate, record and display an objectives hierarchy by creating a list in outline format. (Software applications are also available that allow individuals or groups to create organizational charts that work well in generating visually appealing objectives hierarchies.)

In establishing an objectives hierarchy it is essential to gather as much information as possible to identify the factors involved in the problem. Objectives should flow from “Why?” at higher levels to “How?” at lower levels. Higher-level objectives tend to be broad, inclusive, and even ambiguous, lower-level objectives more specific, which are mapped to real or actual organizational and workplace attributes or characteristics.

The objectives hierarchy should be inclusive, representing a mix of stakeholder views, and not make value judgments in respect to one objective over another.

Building Block Three: Designing Alternatives

For each objective or group of objectives within the hierarchy, it is important to identify the types of actions that would yield the optimal effect.

When designing alternatives, various objectives should have been detailed and considered within the hierarchy. With enough specificity, some may be flagged for specific action or categorized as activity-driven.

Designing alternatives tends to occur in two phases: identifying the principles by which to judge the alternatives—i.e. the standards solutions should meet—and brainstorming, or listing actual potential solutions.

Nine Steps for Identifying Alternatives:

  1. For each objective or group of objectives in the hierarchy, individuals identify the types of actions that would have the desired effect.
  2. Causal pathways among identified variables are reviewed. How might favorable interventions occur in any of these pathways?
  3. Two or more options for addressing each objective are defined. These may be different types of activities, different levels, strategies, or approaches for the same activity type, or modifications to ongoing related activities. If there is already a proposed action, the activities that comprise it are detailed in terms of how they align with the measured criteria in the objectives.
  4. Specific actions are grouped into alternatives. If there are competing objectives (perhaps reflecting different stakeholder values), alternatives can be developed that favor different groupings of objectives. In other words, different balances are sought among objectives in each alternative.
  5. Conversely, the same balance of objectives by different groupings of actions can be striven for.
  6. If based on the effects analysis a revision of alternatives is needed, it is wise to look for simple adjustments first. If major revisions are needed, the objectives hierarchy and decision making model should be revisited to determine whether erroneous or inconsistent logic led to problems.
  7. An open mind should be maintained, with preconceptions about what is the “best choice” not allowed to limit any or all solution options.
  8. For each alternative, specifics as to how, where, what, and when actions will occur should be outlined. Here it is important to make detailed assumptions about each modeled action early and explicitly in order to minimize confusion when placing this information into a structured decision making model.
  9. Results are recorded and activities plotted on a decision making map where appropriate.

Building Block Four: Evaluating Each Choice

For each alternative, it is best to be as specific as possible in terms of how, where, what, and when actions will occur. An analysis of effects may suggest modification of one or more alternatives or the creation of additional alternatives. If the latter is the case it will be prudent to return to the first stage of the process.

It is important to apply standards and judgment criteria (a set of indicators) to determine the pros and cons of each alternative. When the best alternative is identified, a process overview of the selected option is conducted.

During this decision making and planning arena, it is important to make certain that an action or set of actions is specifically geared toward achieving the objectives identified.

Within the evaluation or overview stage, further details can come to light that can either be added to particular action steps or grouped into a different set of alternatives.

Excerpt: Intelligent Decision Making: Pinpoint Management Skill Development Training Series (Majorium Business Press, Stevens Point, WI 2011) $ 18.95 USD

Related:

How Personal Agendas Can Destroy a Team

The Use of Teams Requires Self-Discipline

Overcoming and Preventing Groupthink

Seven Negative Roles & Behaviors Which Undermine Team Performance

For Additional Information the Author Recommends the Following Books:

A Team’s Purpose, Function & Use: Pinpoint Leadership Skill Development Training Series

Building Strong Teams: Pinpoint Management Skill Development Training Series

Building Team Roles & Direction: Pinpoint Leadership Skill Development Training Series

Developing a Team Approach: Pinpoint Leadership Skill Development Training Series

Developing & Planning for Team Results: Pinpoint Leadership Skill Development Training Series

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

//

Decision-Making Begins When an Action Needs to Be Taken

with 5 comments

smallgroup6

Decision-making is a cognitive process leading to the selection of a course of action among alternatives. Whether an action or opinion, every decision making process produces a final choice.

The decision making process begins when an action needs to be taken, but one doesn’t know exactly what to do or where to begin. The reasoning process can be rational or irrational, with most decisions based on explicit or implied assumptions.

Building Block One: Applying The Principles of Decision Making

Judiciously applying specific decision making principles will more often than not make the difference between taking effective or ineffective action. These principles help ensure that all involved stay focused on their specific work-related duties as well as the overall objective the company is pursuing.

When it comes to effective decision making, paying close attention to the organizational universe is not optional, but critical. The attributes contributing to good decisions can translate directly into tangible benefits when applied to the broader framework of business-related operations. Each decision made should serve as a learning experience, whether or not it proves wise.

How is an effective decision made? Maintaining an understanding of the basic role of one’s organization can support thoughtful planning and processes for decision making objectives, which tend to justify the future course of the company.

There are 10 basic steps to follow when a decision has to be made. These include:

  1. Identify principles with which to judge the alternatives. What standards and judgment criteria should the solution meet?
  2. Gather information. What factors does the problem involve?
  3. Identify the purpose of the decision. What exactly is the problem to be addressed and why does it need to be solved?
  4. Brainstorm and list a wide variety of possible choices.
  5. Generate as many likely solutions as possible.
  6. Evaluate each choice in terms of its consequences, using predetermined standards and judgment criteria to determine the pros and cons of each alternative.
  7. Settle upon the best alternative. This becomes much easier once the above steps have been undertaken.
  8. Translate the decision into a specific action or plan of action steps.
  9. Carefully execute the plan.
  10. Evaluate the outcome of the decision and subsequent action steps. Within this process it is important to identify the lessons learned. This is an important step for further development of more effective decision making skills and judgment.

Building Block Two: Creating an Objectives Hierarchy

The first step in the process is to identify the purpose of the decision making effort: What is the problem and why does it need to be solved?

In order to achieve this end it is important to generate, record and display an objectives hierarchy by creating a list in outline format. (Software applications are also available that allow individuals or groups to create organizational charts that work well in generating visually appealing objectives hierarchies.)

In establishing an objectives hierarchy it is essential to gather as much information as possible to identify the factors involved in the problem.

Objectives should flow from “Why?” at higher levels to “How?” at lower levels. Higher-level objectives tend to be broad, inclusive, and even ambiguous, lower-level objectives more specific, which are mapped to real or actual organizational and workplace attributes or characteristics.

The objectives hierarchy should be inclusive, representing a mix of stakeholder views, and not make value judgments in respect to one objective over another.

Building Block Three: Designing Alternatives

For each objective or group of objectives within the hierarchy, it is important to identify the types of actions that would yield the optimal effect.

When designing alternatives, various objectives should have been detailed and considered within the hierarchy. With enough specificity, some may be flagged for specific action or categorized as activity-driven.

Designing alternatives tends to occur in two phases: identifying the principles by which to judge the alternatives—i.e. the standards solutions should meet—and brainstorming, or listing actual potential solutions.

Nine Steps for Identifying Alternatives:

  1. For each objective or group of objectives in the hierarchy, individuals identify the types of actions that would have the desired effect.
  2. Causal pathways among identified variables are reviewed. How might favorable interventions occur in any of these pathways?
  3. Two or more options for addressing each objective are defined. These may be different types of activities, different levels, strategies, or approaches for the same activity type, or modifications to ongoing related activities. If there is already a proposed action, the activities that comprise it are detailed in terms of how they align with the measured criteria in the objectives.
  4. Specific actions are grouped into alternatives. If there are competing objectives (perhaps reflecting different stakeholder values), alternatives can be developed that favor different groupings of objectives. In other words, different balances are sought among objectives in each alternative.
  5. Conversely, the same balance of objectives by different groupings of actions can be striven for.
  6. If based on the effects analysis a revision of alternatives is needed, it is wise to look for simple adjustments first. If major revisions are needed, the objectives hierarchy and decision making model should be revisited to determine whether erroneous or inconsistent logic led to problems.
  7. An open mind should be maintained, with preconceptions about what is the “best choice” not allowed to limit any or all solution options.
  8. For each alternative, specifics as to how, where, what, and when actions will occur should be outlined. Here it is important to make detailed assumptions about each modeled action early and explicitly in order to minimize confusion when placing this information into a structured decision making model.
  9. Results are recorded and activities plotted on a decision making map where appropriate.

Building Block Four: Evaluating Each Choice

For each alternative, it is best to be as specific as possible in terms of how, where, what, and when actions will occur.

An analysis of effects may suggest modification of one or more alternatives or the creation of additional alternatives. If the latter is the case it will be prudent to return to the first stage of the process.

It is important to apply standards and judgment criteria (a set of indicators) to determine the pros and cons of each alternative. When the best alternative is identified, a process overview of the selected option is conducted.

During this decision making and planning arena, it is important to make certain that an action or set of actions is specifically geared toward achieving the objectives identified.

Within the evaluation or overview stage, further details can come to light that can either be added to particular action steps or grouped into a different set of alternatives.

Excerpt: Intelligent Decision Making: Pinpoint Management Skill Development Training Series (Majorium Business Press, 2011) $ 18.95 USD

Related:

Correctly Framing Problems Pinpoints the Right Solution

Seven Components of Critical Thinking

Six Critical Issues To Consider When Solving Problems

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2013 Timothy F. Bednarz, All Rights Reserved

Performance Driven Leaders Must Establish Clear Employee Expectations

with 2 comments

Fred Smith - Founder and CEO of FEDEX

Fred Smith – Founder and CEO of FEDEX

Performance driven leaders must establish clear employee expectations if they expect to achieve positive results and outcomes that are totally aligned with their vision, mission, and goals.

Fred Smith (FedEx) stated, “When people walk in the door, they want to know: What do you expect out of me? What’s in this deal for me? What do I have to do to get ahead? Where do I go in this organization to get justice if I’m not treated appropriately? They want to know how they’re doing.

They want some feedback. And they want to know that what they are doing is important. If you take the basic principles of leadership and answer those questions over and over again, you can be successful dealing with people. The thing that I think is missing in most in business is people who really understand how to deal with rank-and-file employees.”

Admiral Hyman Rickover (U.S. Navy), “who developed a reputation as a talented troubleshooter and effective problem-solver, ensured education and training were priorities and achieved impressive results.

Working days, nights, and weekends and expecting his staff to do the same, he refused to compromise when it came to standards and quality. He expected sacrifice from those who worked for him—and from their families.” “

Agrees Donald Kendall [Pepsi-Cola]: – ‘There’s only one standard. Once you’re stuck on the flypaper, you’re stuck. If you don’t set a high standard you can’t expect your people to act right.’ ”

The great leaders were and continue to be demanding taskmasters. As illustrated by Rickover and Kendall, they established expectations that also applied to themselves as well as to others.

Jeff Bezos (Amazon) is known for creating an entrepreneurial culture laced with fun, but one that does not undermine his expectations. “Bezos expects total dedication from people at Amazon, too, where the hours can be grueling.

Says Acting Customer Service Director Jane Slade: ‘This is everyone’s wife, mother, father, baby, whatever.’ He routinely ratchets up goals for managers and often plunges into minute details himself. Slade, for instance, recalls bringing a long list of her job goals to Bezos early on. He handed her his own list, saying: ‘You tell me what’s more important.’ ”

“Never one to rest on his laurels, [David] Packard [Hewlett-Packard] demanded the same from his employees. ‘You shouldn’t gloat about anything you’ve done,’ he told his employees when he stepped down. ‘You ought to keep going and try to find something better to do.’ ”

Related:

“Leaders Should Set a Clear and Decisive Tone at the Top”

How Well Do You Set the Tone?

When Motivating Employees, Expectations Are Everything

Excerpt: Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Majorium Business Press, Stevens Point, WI 2011) Read a Free Chapter

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2012 Timothy F. Bednarz, All Rights Reserved

Written by Timothy F. Bednarz, Ph.D.

December 17, 2012 at 10:25 am

Decision-Making Begins When an Action Needs to Be Taken

with 4 comments

Decision-making is a cognitive process leading to the selection of a course of action among alternatives. Whether an action or opinion, every decision making process produces a final choice.

The decision making process begins when an action needs to be taken, but one doesn’t know exactly what to do or where to begin. The reasoning process can be rational or irrational, with most decisions based on explicit or implied assumptions.

Building Block One: Applying The Principles of Decision Making

Judiciously applying specific decision making principles will more often than not make the difference between taking effective or ineffective action. These principles help ensure that all involved stay focused on their specific work-related duties as well as the overall objective the company is pursuing.

When it comes to effective decision making, paying close attention to the organizational universe is not optional, but critical. The attributes contributing to good decisions can translate directly into tangible benefits when applied to the broader framework of business-related operations. Each decision made should serve as a learning experience, whether or not it proves wise.

How is an effective decision made? Maintaining an understanding of the basic role of one’s organization can support thoughtful planning and processes for decision making objectives, which tend to justify the future course of the company.

There are 10 basic steps to follow when a decision has to be made. These include:

  1. Identify principles with which to judge the alternatives. What standards and judgment criteria should the solution meet?
  2. Gather information. What factors does the problem involve?
  3. Identify the purpose of the decision. What exactly is the problem to be addressed and why does it need to be solved?
  4. Brainstorm and list a wide variety of possible choices.
  5. Generate as many likely solutions as possible.
  6. Evaluate each choice in terms of its consequences, using predetermined standards and judgment criteria to determine the pros and cons of each alternative.
  7. Settle upon the best alternative. This becomes much easier once the above steps have been undertaken.
  8. Translate the decision into a specific action or plan of action steps.
  9. Carefully execute the plan.
  10. Evaluate the outcome of the decision and subsequent action steps. Within this process it is important to identify the lessons learned. This is an important step for further development of more effective decision making skills and judgment.

Related: Correctly Framing Problems Pinpoints the Right Solution

Building Block Two: Creating an Objectives Hierarchy

The first step in the process is to identify the purpose of the decision making effort: What is the problem and why does it need to be solved?

In order to achieve this end it is important to generate, record and display an objectives hierarchy by creating a list in outline format. (Software applications are also available that allow individuals or groups to create organizational charts that work well in generating visually appealing objectives hierarchies.)

In establishing an objectives hierarchy it is essential to gather as much information as possible to identify the factors involved in the problem.

Objectives should flow from “Why?” at higher levels to “How?” at lower levels. Higher-level objectives tend to be broad, inclusive, and even ambiguous, lower-level objectives more specific, which are mapped to real or actual organizational and workplace attributes or characteristics.

The objectives hierarchy should be inclusive, representing a mix of stakeholder views, and not make value judgments in respect to one objective over another.

Related: Seven Components of Critical Thinking

Building Block Three: Designing Alternatives

For each objective or group of objectives within the hierarchy, it is important to identify the types of actions that would yield the optimal effect.

When designing alternatives, various objectives should have been detailed and considered within the hierarchy. With enough specificity, some may be flagged for specific action or categorized as activity-driven.

Designing alternatives tends to occur in two phases: identifying the principles by which to judge the alternatives—i.e. the standards solutions should meet—and brainstorming, or listing actual potential solutions.

Nine Steps for Identifying Alternatives:

  1. For each objective or group of objectives in the hierarchy, individuals identify the types of actions that would have the desired effect.
  2. Causal pathways among identified variables are reviewed. How might favorable interventions occur in any of these pathways?
  3. Two or more options for addressing each objective are defined. These may be different types of activities, different levels, strategies, or approaches for the same activity type, or modifications to ongoing related activities. If there is already a proposed action, the activities that comprise it are detailed in terms of how they align with the measured criteria in the objectives.
  4. Specific actions are grouped into alternatives. If there are competing objectives (perhaps reflecting different stakeholder values), alternatives can be developed that favor different groupings of objectives. In other words, different balances are sought among objectives in each alternative.
  5. Conversely, the same balance of objectives by different groupings of actions can be striven for.
  6. If based on the effects analysis a revision of alternatives is needed, it is wise to look for simple adjustments first. If major revisions are needed, the objectives hierarchy and decision making model should be revisited to determine whether erroneous or inconsistent logic led to problems.
  7. An open mind should be maintained, with preconceptions about what is the “best choice” not allowed to limit any or all solution options.
  8. For each alternative, specifics as to how, where, what, and when actions will occur should be outlined. Here it is important to make detailed assumptions about each modeled action early and explicitly in order to minimize confusion when placing this information into a structured decision making model.
  9. Results are recorded and activities plotted on a decision making map where appropriate.

Related: Six Critical Issues To Consider When Solving Problems

Building Block Four: Evaluating Each Choice

For each alternative, it is best to be as specific as possible in terms of how, where, what, and when actions will occur.

An analysis of effects may suggest modification of one or more alternatives or the creation of additional alternatives. If the latter is the case it will be prudent to return to the first stage of the process.

It is important to apply standards and judgment criteria (a set of indicators) to determine the pros and cons of each alternative. When the best alternative is identified, a process overview of the selected option is conducted.

During this decision making and planning arena, it is important to make certain that an action or set of actions is specifically geared toward achieving the objectives identified.

Within the evaluation or overview stage, further details can come to light that can either be added to particular action steps or grouped into a different set of alternatives.

Excerpt:Intelligent Decision Making: Pinpoint Management Skill Development Training Series (Majorium Business Press, 2011) $ 18.95 USD

Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreword Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web| Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2012 Timothy F. Bednarz, All Rights Reserved

Measure What Needs to Be Measured

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Performance plans are action plans, not static documents. Effective performance plans must detail the specific actions leaders and employees must follow to accomplish the goals and objectives set within it. Leaders understand that without meaningful performance standards, measuring and evaluating individual performance becomes difficult if not impossible. Once the plan is implemented, meaningful performance standards allow leaders to modify and adapt their plans to actual conditions.

Leaders must use solid standards to monitor and evaluate all aspects of performance. Any measurement used should determine and create an action both on the part of the employee being evaluated and on the part of the leader performing the evaluation.

There is a natural tendency for a leader to focus his or her activities on more prominent areas that will be highlighted and spotlighted, yet every element of the performance plan must be fully addressed.

It should be noted that any standard a leader creates will direct, limit and change the behavior and performance of their employees. This is important for leaders to understand because what and how they choose to evaluate can have either a positive or negative effect on the performance of their organizational unit.

A common pitfall in establishing performance standards is overdoing them. It burdens all involved with excessive factors and controls. Leaders know that to be effective, they need to set performance standards that are relevant and meaningful. It is far better to have fewer meaningful standards than to establish many useless ones. When applied, these standards will present a true picture of the performance of their organizational unit at any given point in time. Four areas to focus on in creating meaningful performance standards are:

What to Measure

The specific elements that need to be measured will vary by organizational unit. Typically, performance standards are set around productivity and profitability. Most leaders establish performance standards by setting specific performance expectations. Examples include:

  • Progress is evaluated by the reaching of specific milestones linked to individual goals and objectives.
  • Profitability is evaluated against the budgets established for each activity.
  • Efficiency is evaluated by the resource utilization within the organizational unit.

Each organizational unit has key factors that determine their success. Leaders identify these factors as indicators of performance and look for trigger points that are early indicators of the success or failure of these factors. For instance, if a leader is managing a manufacturing unit, he or she may focus on projected orders as a key indicator of their unit’s future activities. While a production supervisor may not be interested in these future indicators, a leader looks beyond the immediate horizon to maximize the efficiency of their unit.

How to Benchmark

Once leaders know what they want to evaluate, they need to benchmark each critical measurement. This establishes degrees of confidence and reliability in their numbers. They review these statistics over a meaningful period of time to establish a benchmark of past performance in each area. The longer a leader reviews the past performance of a specific area, the higher the degree of confidence and reliability he or she establishes.

Once key performance standards are benchmarked, leaders establish “triggering events” that result in taking immediate action. Since the benchmarked statistic is the standard, a triggering event can be predetermined. This event or “flag” occurs when performance rises above or falls below a specific percentage of the benchmarked standard. This provides leaders an early warning system to proactively deal with performance problems before they get out of hand.

How Frequently to Measure

Leaders are careful not to overburden themselves with needless information. They use performance standards as a means to keep their finger on the pulse of their unit’s performance. They can easily determine the frequency for receiving reports of their unit’s performance. Some statistics are meaningful on a daily basis, some hourly, and still others only when reported over prolonged periods of time.

What Measurements Indicate

Key performance standards need to inform leaders of the overall performance of their organizational unit. Specific measurements can trigger corrective actions, while others indicate the progress of the unit against performance plan goals and objectives. Effectively utilized, solid performance standards lead and direct the leader’s actions to fine-tune his or her unit’s performance. The right balance of key standards points the way to improved overall performance and productivity.

Excerpt: Planning to Maximize Performance: Pinpoint Leadership Skill Development Training Series (Majorium Business Press, Stevens Point, WI, 2011) $ 16.95 USD

If you would like to learn more about performance planning techniques, refer to Planning to Maximize Performance: Pinpoint Leadership Skill Development Training Series. This training skill-pack features eight key interrelated concepts, each with their own discussion points and training activity. It is ideal as an informal training tool for coaching or personal development. It can also be used as a handbook and guide for group training discussions. Click here to learn more.

Use promo code XC9OTF47 to receive 10% discount on this book.
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Timothy F. Bednarz, Ph.D. | Author | Publisher | Majorium Business Press
Author of Great! What Makes Leaders Great: What They Did, How They Did It and What You Can Learn From It (Finalist – 2011 Foreward Reviews‘ Book of the Year)
Linkedin | Facebook | Twitter | Web | Blog | Catalog |800.654.4935 | 715.342.1018

Copyright © 2012 Timothy F. Bednarz, All Rights Reserved

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