Why Decisions Shouldn’t Be Judged By Outcomes

Simply put — give as much thought to the process as you give to the outcome.

I’m currently in a business analytics class in my MBA program, which is all about using quantitative methods for coming up with the best business decisions. There was one particular quote mentioned in the intro session that really got me thinking.

A good decision is different from a good outcome.

This really spoke to me. Despite sounding counterintuitive, it makes a whole lot of sense. And perhaps, I realized then that the little voice inside my head that’s constantly seeking feedback pays a little too much attention to the outcome and too little to the process that got me to a decision.

This isn’t just about evaluating your choices. It’s about allowing yourself to make mistakes, learn from them, and make better decisions.

About decisions

Decisions are, at the same time, a (1) prediction and (2) attempt to take control of the future. Unfortunately, these two concepts are contrary to each other. With any sort of prediction, there’s an expected level of uncertainty. With any uncertainty, control can never be guaranteed.

There is a principle in Lean (particularly, in the Toyota Way) that encourages us to “defer decisions to the last possible moment”. The shorter the timeframe between now and when the result occurs, the more predictable things generally are.

In reality though, we’ll often find ourselves needing to make decisions for a much longer time in the future. Even with our best efforts, those decisions will always be a set of assumptions about hundred or thousands of smaller decisions we’ll be making along the way. Rarely accurate, unless you get lucky.

About outcomes

No one hopes for things to go badly. No one decides to fail at their goals. But failure happens anyway. That just goes to show how uncontrollable outcomes really are.

The fact is, punishing bad outcomes is basically punishing people for making decisions. When you’re trying to build an autonomous and effective team, this hardly moves you forward. This doesn’t mean we don’t take bad outcomes seriously. Bad outcomes are always indicators of a possible problem.

But simply concluding that the decision was wrong is a lazy move. This doesn’t factor in all the other conditions that led to the outcome. Even more importantly, it doesn’t say much about the “infrastructure” you have to support decision-making — that includes the available facts, processes, and parameters that were considered. Surely, there’s a more reasonable conclusion?

How do we judge decisions then?

Simply put — give as much thought to the process as you give to the outcome. Furthermore, understand the context within which the decision was made. Sure, in a lot of cases, the end does justify the means. But that’s often pure luck. Doing things the right way can actually lead to bad results simply because there’s only so many parameters you can consider at a time.

From another angle, perhaps the decision-making infrastructure was there, but you or your team had to decide without going through the processes. If this is the case, ask yourself why. If it’s due to the situation (e.g. you’ve got absolutely no time to waste, or you were driving blind), cut yourself some slack — there was no way you were going to avoid that margin of error. If you did it just because you felt like it, that’s definitely on you.

Ultimately, there’s truth to the principle that decisions can only be as good as the systems that create them. If you find that the right decisions are often creating wrong outcomes, it’s time to take a deeper look into what supports those decisions and consider how you can make them better.

So we’ve just entered October and I’ve realized I only wrote one article for the whole month of September — what a bummer. On the other hand, it’s been a super busy month for me, so I was at least still productive.

In case you missed it, I launched my eBook “Risk Management Crash Course” a few weeks ago, and I’m giving it away for free! Do subscribe to my mailing list if you’re interested and you’ll get a download code in your mailbox. Let me know what you think of it!

Originally published at https://techmanagement.life on October 6, 2020.

I’m an engineering manager and entrepreneur who loves exchanging ideas and helping others become better at what they do. I run a blog at techmanagement.life

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