Decision Making

Decision Theory and Models

The 1980’s are benchmarked in management history as the era of ‘intuition’ being accepted as a basis for executive decision making.

Thomas J Peters and Robert H Waterman’s book ‘In Search of Excellence’ reported that the best run companies in America nurtured the use and development of intuitive skills in their management cultures. ‘Megatrends’ and ‘Reinventing the Corporation’ author, John Naisbitt also heralded intuition as a respectable basis upon which to make decisions.

Looking back, one now has to ask whether intuition was promoted to management theory status through its own merits, or in response to the failure of seemingly more analytical tools being promoted at the time to support decisions, for instance Management by Objectives [MBO], Program Evaluation Review Technique [PERT]. Whilst these methodologies have a definitive purpose in the management toolbox, they are not regarded as decision making tools.

Whatever the reason, the business environment today is radically different to that of the 1980’s, and just as we do not use the same level of technology as we did in the 1980’s, so too are new levels of people skills and management methodologies required.

More recent research into the functioning of the brain continues to support the value of right brain processes and skills in management. The key is how and when intuition is appropriate in day to day business scenarios, and when a more logic based approach is required.

Intuition

Intuition functions on four different levels: physical, emotional, mental and spiritual.

1. Physical – body sensations in response to another person, or environment, for no apparent reason.
2. Emotional – surface as feelings, an instant like or dislike of someone, again for no apparent reason.
3. Mental – after reviewing a set of seemingly unrelated facts, you anticipate a response or action from another, or visualize in your mind the direction to take.
4. Spiritual – a sense of how one’s own acts, or those of the business are interlinked in an interdependent global society. It represents a sense of ‘comfort’ or ‘social conscience’ around the potential future impact of decisions made in the board room today.

Fully developed intuition is a highly efficient way of knowing – it is fast and it is accurate. The human brains capacity to process a wide array of information extends way beyond that of any computer system.

However, we must recognize that whilst we may appear to have the answers, we do not always have the right prompts, or valid prompts upon which to process cues. Reliable intuition relies on one being completely open to feelings, and to the cues around us. It also relies on our ability not to project our own personal desires and agendas on a particular situation or decision. In such complex environments such as business, gathering all the necessary information manually would take such a long time, that the value of any decision would be highly degraded.

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