CEOs Must Up Level Their Digital-Decisions Skills

CEOs Must Up Level Their Digital-Decisions Skills

On the path to digital mastery, executives need to work on improving the digital-decision making process.

Boardrooms are no longer talking about “why digital.” That answer is pretty clear. Today, the topic of discussion is how to develop digital mastery for an organization’s success.

The new rule? Do digital well, or disappear.

I asked a group of C-level executives (80 in total) for their thoughts regarding the decision-making process associated with achieving digital mastery.

The consensus? Executives throughout the enterprise need to better understand how digital decisions are being made.

EVERYONE is a Digital Decision Maker

Gone are the days when there was one voice and one choice within an organization. Digital decisions have been distributed throughout the enterprise. In 2017 it is estimated that more than 50 percent of the more than $3 trillion spent on information technology each year will be driven from outside the IT organization.

This means that one of the decisions an enterprise has to make on their path to digital mastery is to improve the digital decision making of non-IT executives.

Steven Young, the award-winning Chief Information Security Officer (CISO) at Kellogg’s, via an effective series of investments in awareness, succeeded in empowering nearly 33,000 employees at the iconic cereal maker to make better information management decisions.

Decision-Making Needs To Be Practiced

There are plenty of examples out there where practice makes perfect. Here are a few examples.

High-profile quarterbacks like Tom Brady of the New England Patriots and Peyton Manning of the Denver Broncos have thrown tens of thousands of practice passes before going live in the post-season playoffs.

The entire chain of command at the United States Department simulates decision making by conducting a series of “war games.”

Executives also need to practice their digital decision making. Great organizations conduct exercises that highlight the decisions that will be made in association with implementing new technology infrastructure and handling events such as a data outage/breach or a technology crisis.

Results from digital decision-making simulations indicate that two elements critically impact the quality of the decisions made:

  1. Time (as in the time available to make the decision).
  2.  Information (as in the data available to inform the decision maker).

Time Frame of Decision-Making

Daniel Kahneman, 2002 Nobel Prize winner, behavioral economics pioneer, and author of Thinking Fast and Slow, suggests that the best way not to be victimized by lack of time for appropriate decision making is to “Plan decision making in advance of making an actual decision. Know which aspects of the choices/problem you are going to evaluate, have criteria for assessing each, and know how you are going to compare options.”

Kahneman has empirically observed that “real humans” intuitively construct explanatory stories of action, intention and causality. He observed that we strongly prefer fast stories to slow logical processes and analytical judgments. The bias to fast decisions needs to be programmatically countered.

Do not rush to digital conclusions prematurely. Manage the transition between analysis and choice [i.e., making the decision].

Keep in mind, many critical digital decisions are predictable.

The Information Needed to Make a Decision

Imagine you are sitting in a dentist chair undergoing oral surgery. Imagine that three-quarters of the way through the procedure the surgeon queries, “I’ve taken a few X-rays already—I need to take a few more—is it okay if I take another X-ray? This will, of course, expose you to another small dose of radiation.” Most patients do not have the data they need to systematically make an informed decision. Most people sitting in the chair simply defer to the expertise of the on-site practitioner.

Decision analysis, a term coined by Ron Howard, a professor at Stanford University, specifies a process and suggests tools for specifying options: costs, benefits, risks, and probabilities associated with each option.

Many organizations have not even begun enumerating their options in the digital space let alone calculating probabilities.

Make sure your decision-making process explores all sides of an argument. Do not assume that all you see is necessarily all there is to be seen.

Aggressively seek evidence that indicates that the first answer that comes to mind or the answer, which fits most readily with in-place assumptions, might be wrong.

Do the non-IT executives making digital decision in your enterprise have the information they need to make good digital decisions?

In The Checklist Manifesto, Atul Gawande writes about the difference between errors of ignorance—mistakes we make because we don’t have enough information—and errors of ineptitude—mistakes we make when we have enough information but don’t use it properly.

Framing the Decision

Not all decisions are the same. One of the most important questions facing decision makers is to determine the following: Is this a new problem or one we have experienced before?

When facing new challenges—something you or those in your network haven’t faced before—there will be differing, even contradictory hypotheses about what to do next.

In truly unprecedented situations decision experts suggest canvasing different perspectives from within and outside of your usual networks, with an eye toward conducting experiments.

With this information, how would you rank the quality of your digital decision making? I’d be interested to know your thoughts.

Thornton May is a futurist, educator and author. His extensive experience researching and consulting on the role and behaviors of “C” level executives in creating value with information technology has won him an unquestioned place on the short list of serious thinkers on this topic.

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