A framework for improved decisions

Thomas Davenport, in the Harvard Bus. Rev., Vol. 86, Nov. 2009 at 116, suggests that organizations can improve decision making in four steps. Put in terms of a legal department, they are:

1. “Managers should begin by listing the decisions that must be made and deciding which are most important.” So, in a major lawsuit or corporate transaction, identify which decisions need to be made. “Without prioritization, all decisions will be treated as equal – which probably means that the important ones won’t be analyzed with sufficient care.” This advice reminds me of a key part of setting an agenda for a meeting: allot time to topics in relation to their importance.

2. “[A]ssess the factors that go into each [decision].” So, the responsible in-house lawyer needs to decide who plays what role in major decisions (See my post of Nov. 23, 2008: RACI roles.). How often does the decision come up? What information do we have or need to be able to make the best decision under the circumstances? How well is the decision typically made (See my post of May 27, 2008: post mortems with 7 references.).

3. Having narrowed down your list of decisions and examined what’s involved in making each, you can design the roles, processes, systems, and behaviors” your law department should be using to make them. Davenport doesn’t spell out many details on this third point, which boils down to “improve your decisions.”

4. Give lawyers the tools and assistance to “decide how to decide.” Davenport describes as one example training at Air Products and Chemicals for how to decide the way to resolve various issues, accountabilities, and roles. Other companies, such as Chevron, enlist “decision experts” like decision-analysis groups.

A framework, yes, and Davenport gives examples from two companies and thumbnail descriptions of seven approaches to making decisions. His article comes from his forthcoming book, Analytics at Work: Smarter Decisions, Better Results (Harvard Bus. 2010).