Effective Decision Making by Peter Drucker Review

In Effective Executive, Drucker has a chapter called Effective Decisions. It is primarily concerned with making decisions inside Organizations and Businesses.  I think it has some valuable principle that are useful in general when it comes to make effective decisions.

In a previous posts about decision making we have discussed about:

• Elements + Steps of Decision Making & How to Solve Problems;
• Decision Making, Buridan's Ass 🐴, FOMO and the Rabbits 🐇;
• Common Mistakes in Decision Making and Problem Solving;

What is Decision making?

Drucker says that a Decision is a choice between alternatives (rarely between right or wrong more often between almost right - probably wrong), a judgement, a choice between 2 courses of actions neither of which is provable more right than other.

Where do we start when Deciding?

Many of us start :

• With the Conviction That we are right and the other people are wrong. 
• With the Arrogance That there is only one correct course of action and that it belongs to us.
• With the Conclusion and then look for the evidence that would support our conclusion;

• Being determined to either Convince others that we are right or to Prove that they are wrong;
• Being convinced that we are dealing with facts;
• Believing that other people who don't see things our way are fools, crazy, out to get us;

Drucker makes the point that:

• We don't start with facts but with Opinions, which are nothing but untested hypothesis;
• Good Decisions don't flow from Consensus but grow out of clash of conflicting opinions;
• People who express opinions should take responsibility for defining what factual finding should be expected and looked for;
• Assume that the other person(s) who sees things differently is concerned with different aspects and sees a different reality;
• We should use disagreement, conflict as a way to cover all the important aspects of the Decisions to be made.
• One should ask what is the Criterion of relevance to turn on the appropriate measurement for the Decision.

Reasons for Conflict and Disagreement 

Drucker is a big proponent of Conflict, Disagreement, Clash of Opinions as a way to get to the truth and uncover the major aspects for the Decision to be made.

He gives 3 reasons in support of Disagreement:

1. As a safeguard against Decision Maker becoming the prisoner of  those who have vested interests in promoting their cause within an organization;
2. Provides 1 or more Alternative if the initial Decision proves to wrong;
3. As a way to stimulate Creativity.

Check Necessity for Decision

Drucker argues that a Decision is like a Surgery, it's an intervention within a system and one should be careful about making them due to the associated risks.

1. One should make a decision if a Condition is likely to degenerate if nothing is done;
2. Likewise one should decide if an Opportunity is likely to vanish if nothing is done;
3. One should not waste time with trifles and intervene for the minor conditions that will either take care of themselves or their impact is irrelevant.
4. Realize that most of the decisions will lie between these extremes: If one doesn't act there isn't any major danger yet if one does act there's opportunity for improvement.

 Drucker says that beside Judgement Decision Making requires Courage because often the choose Course of action isn't popular, liked, appreciated by oneself or the others.

He also recommends that one shouldn't:

• Rush into a Decision if one feels Perturbed or Uneasy and to give oneself some time to reflect and inspect the Decision;
• Waste the Time with another Studies unless one expects to get something new and relevant for the Decision to be made.

So what do you think about Drucker's views on Decision Making? 

What Principles and Procedures do you use for Decision making?