Money Matters

Decision making

Money Matters
By Sirajuddin Aziz
Mon, 11, 22

Every single day, regardless of who we are, we end up making several decisions. Even the mundane and run of the mill daily grind requires decision making. Nobody just opens the closet and pulls out a set of suits (clothes), ties or cuff links, randomly - we plan, the day before, what we would wear to work. This decision is based on whether it would be a quiet day, with only internal customers to engage with or would it be a day of meeting clients or a day for going out for business lunch with clients, these aspects will drive the exercise of the choice that we have between available alternatives. If the business lunch is at a Five Star hotel or restaurant, one can choose as per their own taste; but if the lunch is at a private club, then the dress code has to be followed - where a criteria is assigned for decision making; the absolute freedom to decide gets impaired.

Decision making

Every single day, regardless of who we are, we end up making several decisions. Even the mundane and run of the mill daily grind requires decision making. Nobody just opens the closet and pulls out a set of suits (clothes), ties or cuff links, randomly - we plan, the day before, what we would wear to work. This decision is based on whether it would be a quiet day, with only internal customers to engage with or would it be a day of meeting clients or a day for going out for business lunch with clients, these aspects will drive the exercise of the choice that we have between available alternatives. If the business lunch is at a Five Star hotel or restaurant, one can choose as per their own taste; but if the lunch is at a private club, then the dress code has to be followed - where a criteria is assigned for decision making; the absolute freedom to decide gets impaired.

My domestic helper (God Bless him), asks me, each morning, "you want to have for breakfast eggs or cereal"? ; once I choose between these alternatives, I’m required to decide, between boiled, scrambled or fried egg etc. or between, muesli, flakes or bran , with or without sugar - the decision making, we do every day runs into sometimes many thousands. Decision making, in everyday chores, is largely dependent on whether one has alternatives or not. In an unfortunate situation of being without choice, one would have nothing to decide.

Just as we have several decisions to make each day in our personal lives, similarly at our work stations, we have activities that demand unaltered repetitive decision making. Such decision making becomes mechanical - it is made once, in relation to an activity; for example, at a fast food joint, the invariable question that will be posed by the person at the counter will be ‘stay here or take away?’ It has to be said to each customer - no alteration is required - the customer has to decide then and there between the two alternatives. Decision making is a precious activity, the irrevocability of the decisions make the exercise extremely significant.

Decision making requires deliberation; the Greek word ‘Euboulia’, denotes ‘to deliberate’. This means a leader/manager who has to make a decision will resort to taking advice from some or all of his/her team members. Decision making can be essential for profound issues or for mundane aspects. In seeking counsel, the leader will have to evaluate the academic and practical experience of the team. The ability to identify the possible course of action(s) to meet the challenges of the many uncertainties, of business or otherwise too, must be a pronounced quality in those whose advice is sought. Deliberation must precede action, if done conversely, it will tantamount to post mortem of the decision made. Too much discussion actually kills grand ideas. Between two stools one always gets to sit on the ground.

Deliberation of the issues or seeking of advice is not a license to abdicate responsibility for the decision taken by the manager/leader. The action taken or the failure to take action in a given situation must reside as responsibility of the leader; not the member who judiciously with no malafide intentions offers advice, to arrive at a decision. Advice after dinner must not be relied upon especially when it comes to making critical decisions whether of business or of life. Are second thoughts wiser? Not necessarily; albeit it is also true that the afterthought can render the first thought as invalid.

Decision making can be instantaneous, where all factors to decide are available readily. Although taking decisions in a rush is never a preferred option, unless it is a question of a life and death situation.

The veracity of information must be checked. It is on available information that decisions are taken. The rudimentary or incomplete information will not yield good decision making. The consequences of relying on unverified data or analytics can be calamitous and perilous.

In the judicious art of decision making it is considered best if the people who are expected to be impacted by the decisions are called upon to express their opinion on the proposed decision. Many regulators, globally, including our own country, before embarking on a decision that is likely to impact market participants, significantly, share with the constituents a draft of the regulations; once opinion is obtained, the necessary tweaking takes place and only then is the decision announced.

Hesoid, an Ancient Greek poet, considered as a contemporary of Homer, is often referred to as “Father of Greek didactic poetry” - only two of his works have survived the onslaught of time in history. In a passage, he mentions about an advisor in the following words; “the best man is the one who can give himself good advice after considering everything, and the future and his aim. The man who follows good advice is also good. But the one who neither thinks for himself nor keeps in mind the advice of another, is a man who brings no benefits at all.”

Dietrich Barhoefer, in “Miscellaneous Thoughts” says, “It is the characteristic excellence of the strong man that he can bring momentous issues to the fore and make a decision about them. The weak are always forced to decide between alternatives they have not chosen themselves.”

The evaluation of any available precedents or antecedents can lead to informed decision making. The past is always a great guide for the present, consequently ensuring a better future. An excavation of the past numbers/details allow for estimating more accurately the present dynamics of numbers.

Decision making and its related authority can be delegated, but the outcomes/responsibility remains with the person who on a dejure basis is recognized to have been invested by virtue of the office held, the necessary authority/responsibility.

Leaders must decide - procrastination is only viable in very few situations, and it cannot and should not be allowed to become a principle of decision making. In everyday business environments we are called upon to choose between options; if the principles of decision making are adhered to, the outcome can be positive. If there is adventurism in decision making then we have before us from history a different Napoleon - one of Marengo and the other of Moscow. That a 100 years later, Hitler made the same mistake of attacking Moscow in extreme cold, is a matter, where we find that history invariably is condemned to repeat itself - for good or for worse.

Some leaders habitually develop into being managers who make no decision and allow for things to prevail and not act upon it. Indecision is to perish - oneself and the institution.


The writer is a senior banker & freelance columnist