Mastering the 5 Decision Making Styles in Management

Effective decision making is crucial for individuals and organizations alike. Each decision made provides insight into the decision maker and their approach. While decision making is not an exact science nor pure art, it requires a delicate balance between the two.

The decision making process involves defining the problem, gathering and analyzing information to reach a conclusion. However, the individuals involved in each step bring their own mindsets, preferences, biases, and past experiences that greatly impact the decision making process. Eliminating these influences entirely is challenging.

Hence, it is crucial to have a deep understanding of decision makers' characteristics and the driving forces behind their decision-making process. By doing so, it is possible to identify their decision-making style and take necessary measures to mitigate the impact of subjective factors, thereby ensuring objectivity in the decision-making process.

Origin of the concept of decision making styles

The study conducted by Dan Lovallo, professor of business strategy, and Olivier Sibony, director at McKinsey & Co., involved a thorough analysis of approximately 1,000 cases of critical decision making. The study focused on determining the level of concreteness in the decision-making process.

The extent of information analyzed;

The power center of the decision making;

risk appetite of the leader;

His personal aspirations versus that of the community of stakeholders

The study aims to strike a balance between focusing on hardcore facts and having a broader, long-term vision. To achieve this, the researchers have identified 5 decision-making styles that will be discussed shortly. The main objective of the study is to identify the decision-making traits of leaders during critical business decisions. It is acknowledged that leaders may overlook certain aspects or give less consideration to them based on their predominant decision-making style. Therefore, broader group participation can supplement these dimensions.

Which are the 5 Decision-making styles?

Lovallo and Sibony study identifies 5 characteristic styles of decision making:

Visionary

Guardian

Motivator

Flexible

Matching the six parameters of decision making with the nature of the problem at hand is crucial for successful decision making. While each style has its own unique advantages and disadvantages, the right match can ensure satisfactory decisions at all levels and increase the probability of success. Therefore, understanding the decision making style is a catalyst for effective problem solving.

5 Decision making styles explained in Detail

1) Visionary:

Leaders with a visionary decision-making style possess a natural ability to take quick action. They do not hesitate to act, even when lacking full information or analysis, relying instead on their own intuition to guide them to the heart of the matter.

2) Guardian:

While the autocratic decision style may be effective during crisis management, it can lead to significant bias if overused. It is important for a visionary thinker to gather information from diverse sources and seek input from various stakeholders in order to balance their own perspective.

The decision maker in question places a strong emphasis on following a structured approach to decision making. They prioritize the collection of ample information and thoroughly analyzing it from all angles before making a decision based on the facts. Their risk-averse nature leads them to prefer the security provided by data, careful planning, and reliable processes. Rather than venturing into unknown territories, they rely on extensive, detailed information to guide their choices, ultimately creating a sense of safety within their organization.

3) Motivator

However, the Guardian decision making style may not be suitable for leading an organization through times of radical change. Leaders with this style may struggle to make quick decisions in ambiguous situations. To effectively navigate uncertainty, Guardian decision makers must seek out diverse perspectives, build their capacity for dealing with ambiguity, and develop a long-term vision that is adaptable to the constantly evolving business environment.

Motivators possess a unique ability to envision the future in a powerful and inspiring way. They are skilled at convincing their team members to join them on this journey towards a "bigger and brighter" version of the future. Their leadership style is highly effective in motivating people to work towards turning their vision into a reality.

However, a significant problem can arise when these motivators become overly focused on their own goals and pursue them to the point of disregarding any information that contradicts their objectives. This narrow-minded approach can result in a lopsided decision-making process that can be detrimental to the organization. In addition, they may disregard the best interests of the organization and all stakeholders while pursuing their own aspirations. Therefore, it is crucial for them to incorporate dissenting voices and establish a rational decision-making process.

4) Flexible

When decision makers adopt a flexible approach, the power dynamic of decision making shifts to include input from various stakeholder groups. A flexible decision maker is open-minded and encourages team members to actively participate in the decision-making process. They are receptive to diverse perspectives and are willing to consider a range of solutions to address the issue at hand.

To prevent decision makers from losing their own voice and purpose in the decision-making process, it's important to establish a clear vision and direction from the start. Additionally, decision makers should set a specific time limit and carefully plan the necessary steps and information required for the decision-making process to avoid any confusion.

5) Catalyst