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Decision Context in Performance Management

Let’s talk about decision context. The decisions I make should all be based on the difference between my current status and the goal I desire for the future. We need to have:

  • outcomes/goal/results…

    • What you want to achieve, it represents what it is you wish to accomplish.

  • foundations/assumptions…

    • Mental models used to make decisions.

  • decision/hypothesis…

    • Used to describe the relationship between my assumptions, the actions I want to take, and how it will help me achieve my goal.

    • If I have my hypothesis, given my assumption, “if I do these activities, it’ll bring me closer to my goal;” I can use this to create milestones and metrics to help me stay on track.

  • outputs/activities…

    • The actions I plan to take in order to achieve my goal.

Iterating Our Decisions in Performance Management

The gap between my current status and my desired state is the problem we’re trying to solve. Every decision should always be how to solve the problem, how to get rid of the gap. This context should be involved with every decision. Commonly, context isn’t given; instead they begin with the decision in mind and weighing of options. However, if you avoid using this specific strategy (minding the gap), you can’t center on the right context to make a decision because it becomes skewed. Normally, we eliminate options but we can’t think of all the options that could be eliminated.

“Leaders can let you fail and yet not let you be a failure.” - Stanley McChrystal

Once you understand this, when you’re making decisions, what you want to do is go through and iterate a decision; we call a decision different things in different states. Ordinarily, before we do a lot of research, we call a decision we’d like to make an assumption. After we do some research, we call it a hypothesis. After we test the hypothesis, call it a conclusion. Then, when we feel we have enough sufficient evidence (a decision has been tested several times), then we call it a decision. This is when people don’t change their decisions.

What we want is the ability to challenge assumptions and update our decision-making. Ergo, what you want to do is talk about decision-making and the four components to manage decision-making tentatively; we shouldn’t discuss it in concrete terms until after we have sufficient evidence. Until that point, we want to discuss things in a tentative way that lets people know you can change the decision without penalty. The more you do this, better decisions are made regularly.

Changing Management in Decision-Making

Management plays a big part in censoring decision-making because they hold people accountable; they also usually ask for specific tasks to be completed. We don’t want to do this because then people will stick to a decision, even if it’s bad because at the time it was made there wasn’t enough information to support it. Rather, what we want to do is talk tentatively and hold people accountable for the outcome (reaching the goal), not the activities that they make nor the decisions. We might hold people accountable for the decision-making process and encourage them to follow it, but not for the decisions themselves.

In addition, we should encourage people to update the context on goals and assumptions. Again, as you go through research, you may figure out that the assumption you had before wasn’t true. Consequently, it’s important for people to write down something else and test that. People need to know they’re encouraged to update both the assumptions and the goals. But if you want decision-making to be good, due to the state people are in right now, (with being reprimanded in the past for changing their assumptions and goals) you almost have to force people to test out the assumptions, review the goal, and see if it’s still valid.

“When you train your employees to be risk averse, then you’re preparing your whole company to be reward challenged.” - Morgan Spurlock

If you don’t have a process that forces people to change their decision-making process, their training reinforces them to not change their assumptions or goals; they will continue to make the wrong decisions. Furthermore, each iteration, each time you test things, our ability to reduce risk improves. What we should do before we begin the decision-making process is take the decision we’re making and think about how much time it would take to make that decision. Think about how much time it should take to make a decision in advance. Stick to that timebox, only take that much time, then make your decision.

What we’ve done in the past is make a timebox for activities, let’s forget that. Everything you do with activities you should do with decisions. For example, I should definitely spend less time trying to think of what I’m going to eat for lunch than I spend time planning where I want to send my kid to college; the time spent should be different. The more important the decision, depending on the goal you’re trying to achieve, the more time you should allow for decision-making. But if the consequences of the decision are irrelevant, you should spend less time on them.

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