Data Centred Decision Making

Making decisions can be tough: so many choices and no guarantees of making the right one. I’ve recently seen the decision-making process behind two decisions and both were instructive.

The first was for a social group where an interesting ethical question came up. The question and replies batted backwards and forwards. There was no right or wrong answers, but plenty of indignation and lots of opinion. Then someone sent a simple email containing the data relating to the problem. They had gone to the archives and dug up the relevant history and presented it clearly and dispassionately in an email. It was strong stuff and illustrated beautifully the uncomfortable feelings that everyone had about the dilemma. Getting the information took a bit of time but the effect was convincing and helped the group enormously.

The second was a decision at work where again feelings ran high. My co-Director had one opinion and I a different one. We discussed and argued the point but couldn’t get agreement. We decided to break the meeting to go do some research and analysis. When we came back together the decision was obvious – the data spoke volumes. We went away with a clear decision and no hard feelings.

Data centred decision making takes more effort because you have to go and get the data. Sometimes that takes quite a long time, but better decisions come out of the process. When you look at the two examples above, I think both were solved faster and more amicably by having good data.

Not all decisions lend themselves to data-centred decision making, but it’s worth asking “what data is available?” even if it only contributes to the process. Sometimes the results are surprising.

How's your business heartbeat?

Does your business have a heartbeat? A rhythm that you work to? A monthly or weekly routine that punctuates other work?

I’m referring to regular work in your schedule that absolutely, definitely, no-question, must get done sort of stuff. Many businesses have set dates for status reports, month end accounts, marketing communications, or even expenses claims. I certainly remember during my younger days resenting such deadlines – they seemed bureaucratic and always came at the worst possible time. But over the years I started to understand the benefits of such schedules and to appreciate being able to plan my work.

The most obvious example of this is statutory reporting of results. The larger the business, the more onerous and important the process, but most organisations have some statutory responsibility to disclose their financials.

If you work in a small or micro business, it’s up to you to set business deadlines and to ensure they are adhered to. As a result, many people don’t bother, and important things either never get done or get done so infrequently as to damage performance.

So what are the advantages of setting a regular schedule for regular work?

1. Things get done faster if they are done regularly. Any job is a lot easier if you have to do it weekly or monthly rather than quarterly or even less frequently.
2. People know what to expect. Communicating with customers and prospects, for example, is best done to a regular schedule so they know start to expect your communication.
3. It simplifies decision making and therefore increases the chances of the work being done. Decisions about what needs to be done are made well in advance so that everyone knows what is expected.
4. You can plan. When you know what’s needed and when, you can plan your days and weeks accordingly. This also means that bigger blocks of work can get done over a period of time.
5. You can measure compliance. This is not an advantage if the activity is pointless, but you shouldn’t be doing it if it’s pointless. So meeting the scheduled time for the work has benefit, as does measuring compliance until it becomes a habit.
   

The biggest disadvantage with regularly scheduled work is that people keep on doing it after it has ceased being useful. Whilst this does happen, I think it happens less than enforcing the schedule work that could benefit from a disciplined schedule.

Aspects of improving performance

There is a strong feeling that the business world is changing. Social media is rushing towards us at an uncomfortable pace, the internet is evolving and financial crises of varying types are still with us. Added to which, many people’s jobs have changed over the last 10 years. There are many more information workers, people who frequently know more than their line manager within their field of expertise.

Yet the fundamentals of business apply. The business of business is still business. To make a healthy profit in today’s fast changing and difficult economy it is necessary to have eyes everywhere and good information. Perhaps it was ever thus, it just feels more important than ever right now.

The 4 E’s are a good starting point:

• Effectiveness
• Efficiency
• Economy
• Ethics

Effectiveness is whether we are furthering our goals. Obviously, you can’t measure effectiveness unless you know what your goals are. Having the right strategy is still Top Dog.

Efficiency is getting things done in a time and resource efficient way. Doing the wrong things efficiently won’t help you be more effective, and doing the right things too slowly will make you uncompetitive, which is why efficiency comes after effectiveness. In our “Getting Things Done” culture, it pays to remember to pay attention to Effectiveness before turning to Efficiency.

Economy is making sure you don’t spend too much on being effective or being efficient. Most organisations, large or small, have good systems to keep tabs on this one.

And ethics is ensuring you don’t trample over other people or squander the earth’s resources in pursuit of your dreams. An increasingly important dimension to business and living in the new world order.

Simple? On paper, sure! In practice? Well that’s where the art, science and monitoring of business starts.

It is down to each person, each team and each organisation to figure out what the 4 E’s mean for them, and how to measure them.

A Quiet Pomodoro

I’ve written before about the simple but brilliant Pomodoro Technique. It is a more fun version of a technique that I have used for years which I prosaically named the Stopwatch Technique. It’s not difficult to see why one is now a world-wide phenomenon and the other is, well, a red stop watch in my drawer.

For those not familiar with either technique, the idea is basically that you concentrate on one task at a time, and work for a set period of time, stopping when time is up to take a short break. The Pomodoro Technique uses a wonderfully bright red tomato timer (beautifully red and wonderfully tomato-like). The Stopwatch Technique uses a, eerrrr, stopwatch.

Both are pretty low tech and both are effective. The difference is that the beautiful bright red tomato timer ticks rhythmically as you work and then shrills out with a loud ring when time is up. Without fail I jump out of my skin when this happens, as does everyone else in the office. I’ve tried putting it in a drawer or under a sweater to muffle the sound, but the deeper I concentrate, but more shocked I am when the timer rings out. Perhaps just an indication of how successful the technique is.

So quietly and without fuss I have been going back to the stop watch. It’s not as pretty (although it is a very groovy red) but it is SILENT. It doesn’t tick, but it does remind me that time is passing and encourages me to focus. It also makes me very aware of time and how I use it.

There are no web sites for the stop watch technique, no groups on Facebook or Tweets on Twitter, but it is a gentle, effective and most of all quiet way of reminding me to value my time and focus on the task in hand. Not bad for the £1.99 I paid for it about 12 years ago.

What makes a great leader?

I’ve been mulling over the findings from my analysis of Top American CEOs. Statistics are always interesting; learning from facts rather than prejudices. But of course statistics can be highlighted in whatever way the author wants. I know someone who was looking at the exact same data from the point of view of college drop-outs rather than post-graduate qualifications which was where I started. The way you twist and turn data can change the way you see things.

But one of the numbers that has stuck in my mind since looking at the data is the length of service that these people have with their organisations. About 80% have been with their companies longer than 10 years. The Japanese famously reward employees through length of service rather than merit, which seems very strange to western ways. Yet clearly there is something to be said for learning a business inside out.

The one thing it is difficult to see from statistics is the personalities of these people. Perhaps what they have in common is their determination to succeed, whether or not they stayed on at university and regardless of where they did their MBA.

Jim Collins is inspirational about leadership in his book Good to Great which I am rereading at the moment. He talks of Level 5 leaders who are humble, self-effacing and steely in their determination that their organisations succeed. He describes the way they don’t take personal credit for successes, but attribute the good stuff to the efforts of their team. He also describes the way they are always prepared to take the blame for problems.

If Collins were doing his research today I wonder how many of these Top American leaders would qualify as Level 5 Leaders …

The other common characteristic amongst the 100 top CEOs is that they are all men - without exception, 100%. It is perhaps the starkest statistic of all yet I was so immersed in business schools and length of service that I missed it. Oddly enough, all Jim Collins’ Level 5 Leaders were men too. What does that say about women in business today?

The view from the top

Ever wondered who runs the top US companies? Forbes published a list in 2008 of the top 500 Chief Executive Officers in America, ranked by their remuneration, and it makes instructive reading.

I decided to take a closer look at the top 100 amongst this elite bunch and this is what I found:

• American corporations are not run by college graduates. On average they are 58 years of age; the most junior is 43 years old and the most senior is 80 years young.
• They have worked at their companies for an average of 22 years and almost a third has worked for their companies for 30 years or more.
• They have been in post for an average of 11 years.
• They get paid an average of $40m per annum. Trust me; you don’t want to know how much Larry Ellison gets paid. Even the lowest annual remuneration of almost $18m is eye-watering.

They are, of course, running some of the largest and most successful companies in America. So what are the qualifications for a successful CEO? Well it seems that staying on at school helps: two third of these CEOs has a post-graduate qualification:

• 45% of America’s top CEOs has an MBA, with Harvard the business school of choice
• 5% have a PhD
• 14% have another post-graduate qualification.

One third, of course, has no post-grad qualification at all. And some don’t have a first degree, the most famous of whom is Larry Ellison who dropped out of college to start Oracle.

Only 12% of these CEOs founded their companies, the rest have either risen through the ranks or been drafted in to run the company. 75% have been with their companies for 15 years or longer.

So it seems that if you want to run a large corporation, sticking to knitting definitely helps. As does concentrating in strategy class.

Managers Behaving Professionally

I have personally seen two examples recently of Managers Behaving Badly. Unfortunately, unlike the TV series Men Behaving Badly, which was truly hilarious, bad behaviour at work isn’t funny. It’s stressful, worrying, and sometimes can have devastating effects. Only recently France Telecom was in the news for their abnormally high rate of suicides amongst their employees during at time of reorganisation.

So what constitutes professional behaviour from a manager? How can stress be reduced at times of change and job losses? With our own postal strike rumbling on, these seem like particularly pertinent questions. Some thoughts on managers behaving professionally:

1. Define what constitutes a job well done. By thinking through in advance what you need from people, and what they need to do the job, everyone’s chances of a good outcome are increased.
2. Acknowledge good work. Jim Collins in his book Good to Great talks of exceptional leaders who took the blame when things went wrong, but never took the credit when things went right. They gracefully acknowledged the contribution of their team. Paradoxically the team held the leader in higher regard for his or her actions, rather than feeling they hadn’t contributed. It seems humble leaders are also good leaders.
3. Do what you say you are going to do. So simple, so effective, and so appreciated by everyone.
4. Be open and allow people to understand, rather than presenting a fait accompli. Stress is at its highest when things are being done to you, rather than you being in control. Many small businesses are facing very difficult times at the moment, but stress levels are managed because owners have all the facts and can work accordingly.
5. If training budgets have to be cut find other ways of getting information out to people who need it. It is stressful and very difficult to work without the knowledge you need to do a good job. Be creative and encourage knowledge cafes to share information about topics that might have been dealt with through a training course before budgets were cut.

It’s a pretty stressful time for everyone at the moment, but reducing the stress and worry out of people’s working lives as far as is possible, has to be a worthy goal.