In our post on decision-making methods, we delved into the dynamics of decision-making in organizations, drawing attention to the different methods and their impact on your team’s success and culture. We put a spotlight on consent-based decision-making and explored its potential in fostering a culture of openness, respect, and innovation. Yet, a crucial part of the decision-making process remains unexplored: how do we evaluate the quality of these decisions?
In the world of engineering, the stakes are often high. Making the right decisions can lead to innovative breakthroughs, while incorrect ones can result in costly delays, or worse, catastrophic failures. The quality of our decisions, however, should not be judged solely by their outcomes. This might seem counterintuitive, but there’s a wealth of insight to be gained when we separate decision quality from outcomes.
Probability in Engineering Decision-Making
As engineers, we’re quite familiar with dealing with probabilities. We routinely use probabilistic models to predict failure rates, assess risks, estimate when work will be completed, and make informed decisions about design, materials, and processes. The same mathematical reasoning is at the decision making in engineering organizations.
Each decision we make is a small leap into the future. We gather and analyze data like detectives, weighing different scenarios and finally, choose the option we believe has the highest probability of success—like placing a well-informed bet on tomorrow. However, even with a sound decision-making process and thorough analysis, improbable outcomes can and will happen.
When assessing a large number of decisions, it’s not uncommon to see outcomes that, in isolation, would be considered highly unlikely. That’s simply how probabilities work. We’re often surprised by these “black swan” events because our brains aren’t intuitively wired to understand probabilistic events. But understanding this concept can help us make sense of surprising outcomes and improve our future decision-making processes.
Learning from Decisions: The Good and the Bad
The complexity of engineering projects means that a multitude of factors contribute to their outcome. It’s not just about the decisions we make, but also about the role of luck, the presence of unknowable information, and uncontrollable circumstances. Hence, it’s crucial to learn from our decisions in ways that are not solely dependent on the outcome.
Often, we fall into the trap of judging a decision by its immediate result. However, this approach can obscure the myriad of technical and non-technical factors that also affect the outcome. Therefore, it’s essential to delve deeper and understand the decision-making process behind each outcome.
When we achieve a successful outcome, we must examine the decision that led to it. Did we make a good call based on sound analysis, or did we simply get lucky? Conversely, when an outcome doesn’t meet our expectations, it’s important to explore the reasons behind it. Was the decision fundamentally flawed, or did unforeseen factors beyond our control lead to the unfavorable results?
Recognizing the pace at which certain decisions need to be made is also an integral part of this learning process. Some decisions require swift action, while others are worth engaging with a lengthy, analytical process. The key here is to strike a balance between the energy we invest in decision-making and our tolerance for adverse outcomes. Remember, a poor outcome doesn’t always mean we should have made the decision differently. However, it also could mean exactly that.
Quality of Information and Decision Making
The quality of information used to make a decision can greatly impact the outcome. In engineering, we’re often trying to make decisions with incomplete or imperfect information. This uncertainty can lead to analysis paralysis, where we spend excessive time and resources trying to gather more information, hoping to make a perfect decision. Often the fastest way to gather more information is to make more and smaller decisions.
It’s important to understand that no decision can be entirely risk-free. Often, it’s more beneficial to make a well-informed decision with the available data and adjust course as new information comes in, rather than waiting for perfect information that may never arrive.
This approach implies emphasizing making the smallest possible decision you can to make progress and learn new information. Decisions and the resulting actions create the feedback loop where you then learn and make new decisions. Just like agile development, the shorter we tighten that loop, through making smaller decisions and more frequent actions, the more we learn and adapt to the contexts we are operating within.
Implementing a Decision Journal
A decision journal can be a powerful tool to help us learn from our decisions and improve our decision-making process. It’s a place to document not only the decision and its outcome, but also the reasoning behind it, the information you had on hand, the information you could not know or chose not to learn due to constraints, the uncertainties involved, and the expected result best expressed in roughly estimated probabilities.
By performing retrospective decision analysis, we can gain insights into our decision-making patterns, identify any biases we may have, and improve our ability to make predictions about the future. Over time, reviewing this journal can help us understand when we’ve made sound decisions and when we’ve merely been fortunate. When reviewing past decisions consider:
- Do you always underestimate a certain type of outcome?
- Should you spend more or less time gathering information?
- Do you spend too much time gathering irrelevant information and miss broader context?
- Are you calibrating the length of coming to a decision properly?
- Are you over-investing on decisions that are easily reversible?
- Are you over-investing on decisions where two or more options can all lead to favorable outcomes and it’s best to flip a coin or roll the dice and move onto something where the range of outcomes are more significant?
This process doesn’t have to be burdensome. Teams should log decisions and additional information in a wiki or some other central way. RFCs, which many engineering organizations use, are already a method of doing this for architectural changes to their product and infrastructure. As a leader, I keep my decisions in my hand-written notebook and make an entry in the table of contents and schedule a time to review it in the future.
Leadership’s Role in Fostering a Learning Culture
As engineering leaders, we play a crucial role in fostering a culture that values learning from decisions, regardless of their outcomes. All good engineering management strategies should have learning and adaptability as core tenets. As you are elevated in an organization, it is almost always best to delegate decisions as close to the work as possible and then help them make decisions better. It’s our job as leaders to create an environment where good decision-making practices are recognized and rewarded, even when the outcome is unfavorable. We want to create the safety necessary to make innovative changes and keep the pace of development high.
We can model this approach by openly discussing our decisions and their outcomes, encouraging transparency and shared learning. Moreover, we can create a space for team members to share their decision-making experiences and learn from each from each other. This culture of learning and openness can help our teams become more resilient and adaptive, better prepared to face the challenges of the dynamic engineering landscape.
Risk Management and Decision-Making
Risk management in engineering is an inherent part of the decision-making process. Each decision provides an opportunity to evaluate potential risks and identify the best course of action for their mitigation. Moreover, this process can reveal previously unrecognized risks, which can then be incorporated into the organization’s risk management framework.
Considering various outcomes during decision-making also allows for crafting contingency plans. Unforeseen circumstances, such as supplier failure, can be swiftly addressed if alternatives were deliberated during the decision process. This proactive approach not only mitigates risks but also bolsters operational robustness.
Furthermore, understanding risks associated with different options equips us to make informed decisions, creating a symbiotic relationship between decision-making and risk management. This ensures a systematic approach to tackling challenges, enhancing the quality of our engineering projects through continuous improvement.
Enhancing Stakeholder Communication through Deliberate Decision-Making
Strong communication with stakeholders is paramount in managing the successful implementation of engineering projects. A methodical, transparent approach to decision-making can significantly enhance our ability to effectively communicate with these key participants.
Stakeholders, such as clients, executives, or other teams within our organization, are directly impacted by our decisions. As such, they deserve to understand the reasoning behind these decisions. Here’s how our intentional decision-making processes can help:
1. Transparency and Trust: By adopting a systematic decision-making process, we inherently build a framework that promotes transparency. When we can articulate the steps we took, the probabilities we considered, and the information we used to reach a decision, we provide stakeholders with a clear insight into our thought process. This transparency engenders trust, demonstrating to stakeholders that our decisions are rooted in careful analysis rather than arbitrary judgment.
2. Alignment and Expectation Management: Our methodical approach to decision-making equips us to better set and manage expectations. By considering and communicating the possible outcomes of a decision, including those that are less favorable, stakeholders are better prepared for a range of scenarios. This proactive alignment can help prevent confusion and disappointment down the line.
3. Mitigating Misunderstandings: A well-documented decision-making process also serves as a useful reference point for discussions with stakeholders. This is where tools like a decision journal can prove invaluable. In cases of questions or disagreements, we can revisit the record of our decision and recall the context around how it was made to provide clarity. This not only forms a solid basis for discussion but also helps prevent misinterpretations or memory biases.
Intentional and transparent decision-making is a powerful communication tool. It helps us establish trust, manage expectations, resolve disagreements, and foster collaboration with our stakeholders, paving the way for more successful engineering projects and stronger relationships.
Decision-Making and the Future of Engineering
As we continue to navigate the complexities of engineering, the importance of solid engineering decision-making processes becomes increasingly evident. By understanding the role of probabilities, appreciating the impact of information quality, fostering a culture of learning from our decisions, and communicating the additional context and probabilities we consider during the process we can guide our teams to greater success.
With the aid of tools like a decision journal, we can enhance our ability to evaluate and improve our decision-making practices over time. This not only benefits us as individuals but also strengthens our teams and our organizations.
The art of decision-making in engineering is a complex yet rewarding discipline, intertwining the realms of probability, information quality, and learning culture. As engineering leaders, it’s our responsibility to foster this understanding and guide our teams to a future of innovative success. Consider this your invitation to undertake a personal audit of your decision-making process. Are you accounting for probabilities? Are you valuing the quality of information? Are you encouraging learning, regardless of decision outcomes? Your answers could redefine your leadership journey.
Continuing the Conversation
The conversation shouldn’t stop here. Every situation is unique and I value your experiences. I invite you to reach out to me directly, for feedback on this article or to start a dialogue on how we can transform your challenges into opportunities.