I’ve earlier blogged about how I find intuition and seeing the value of the tacit knowledge as very interesting perspectives for the decision-making. As social business and new ways of working are now changing the organizations and the entire business landscape, and further adding to the complexity – I’ll find it even more interesting to study decision-making and how understanding is created.

I was looking for something else from my bookshelf and found the good old book by Stephen P. Robbins “Essentials of Organizational Behavior”, and randomly checked out the chapter about individual differences in decision-making.  What I found was an interesting quadrant that describes the leadership styles related to the decision-making, it has two axes: Way of Thinking and Tolerance for Ambiguity. The four styles of decision-making are:  Directive, Analytical, Conceptual, and Behavioral.

So here’s a quick go-though of this model, followed by my free associations from it.

• Way of Thinking, very simplified: Logical, analytical leaders are processing information serially versus intuitive and creative ones perceiving things as a whole.
• Tolerance for Ambiguity, again simplified: some of us have a high need to structure information in order to minimize ambiguity, while others can process many ideas and thoughts simultaneously.

A very quick comparison of the types (yes, pretty obvious ones, you can hop over to my associations if you like):

• Analytical types have a better tolerance for ambiguity than the “traditional” directive decision-makers. An analytical type of leader usually search for more information and alternatives than directive ones.
• Leaders applying the conceptual style in decision-making are often considering many alternatives out of broad perspective. Additionally they take a longer term perspective. This style gives most room for creativity, the authors claim.
• The forth style, behavioral style, is the most receptive for suggestions from others, peers and subordinates, and leaders of this style love the meetings! They are also trying to avoid conflicts and find a consensus.

In Finland we call the behavioral style as a Swedish leadership style: it is based on utterly politeness and caution, and taking ages to get any decisions. Meanwhile the traditional Finnish way has been the opposite; very direct, focused on the matter (seeing people as resources, no space for feelings here) and with low tolerance of ambiguity. The formal business education in Finland has a long time emphasized the rational analysis and thinking which have led to this ’inflexible’ style. Naturally leadership styles are developing here in the Nordics too. But I think we Finns have much more home work to do than our friends in Sweden.

An essential perspective to this very topic comes from the always inspiring Rachel Happe who recently blogged about decision-making in the networked world, here’s a quote from her excellent post:

“We need to move forward boldly and make decisions despite incomplete information… but also be prepared to change our path. It’s easy to just shut down when faced with an environment in which you can never be certain or absorb all the information available. But if you are a leader, you need to accept the uncertainty and move forward anyway. “

I very much agree with her and that is exactly why I wanted to look at the model, via three associations I spontaneously got.

My three spontaneous associations on the model

This decision-style model gave me the following associations:

1. Systems Intelligence Theory of Esa Saarinen,
2. Value and Importance of Serendipity (the weak links and the edges),
3. Value and Importance of Listening.

Firstly, this decision-making style model and its division associated with the Finnish philosopher Esa Saarinen and his research of Systems Intelligence. Saarinen and his fellow researchers describe the two ’thinking systems’ we all have: System 1 thinking as automatic, associative, and intuitive. System 2 thinking is dominating in the work places: you better be strictly rational. In every day work situations the System 2 thinking is active and often unintentionally blocking System 1 thinking – and therefore narrowing the possibilities at hands. When both systems are active, there’s a room for intuition, interaction and emotions – and for better understanding and decision-making.

Being strictly rational in your work role is not working anymore. We need utilize our full potential. I have blogged about this earlier e.g. in posts ”Mental Bodybuilding for Knowledge Workers” and ”Are You Systems Intelligent?” featuring my favorites Hagel and Saarinen.

Secondly, I thought of the on-going lovely discussion about serendipity, a discussion where John Hagel, Luis Suarez and Ana Silva are the ones I love to follow, to interact with and listen to. When I saw the decision-style model I was right-away thinking about replacing the Tolerance of Ambiguity into the Level of Embracing Serendipity.

It would broaden the model towards the thinking of the “Power of Pull model” (by John Hagel, Lang Davison & John Seely Brown). I agree with them that the cloud-enabled new platforms for serendipitous encounters lead to new kind of innovation, decision-making and leadership.  We can now easily meet companies and people we did not know existed, and this helps us to be more creative and also broaden the basis we rely on when making decisions. The edges are fruitful places for the innovation, to help us to make innovative decisions, but also for supporting a better understanding.

The approach both Esa Saarinen and John Hagel & his fellows suggest helps us in achieving our full potential as individuals, and the same applies to our organizations, via the people in it. In addition, serendipity can be shaped, and utilized in decision-making.

The third association I got is the value and importance of listening in decision-making, and in life in general. I serendipitously bumped into a beautiful TED Talk by Julian Treasure (what a lovely last name he has) about the importance of listening.

I warmly recommend you to listen to his talk (7:50 min), very inspiring.

Yes indeed, active listening deserves our attention in the chaotic and changing environment, too often forgotten. In his talk Julian shares five tips for better listening. I found the fifth one, his RASA model, beautiful and absolutely something every one of us should apply in our daily life and the decision-making situations. Acronym RASA comes from Receive, Appreciate, Summarise, Ask – and these four verbs should be part of our personal decision-making, learning processes, and leadership.

Julian says aptly: Conscious listening creates understanding. I’d like to add that listen not only your peers, colleagues, family members and friends, but listen to yourself too.

I believe that better decisions and shared understanding are both enabled by these notions we associate with the social business:

Genuine interaction, collaboration, learning, openness, sharing, trust, P2P instead of B2B & B2C, living network instead of stiff hierarchies, listening, intuition, passionate creativity, and embracing serendipity.

All these leading to not only learning and better understanding but also to better decision-making, and success in whatever you are doing.

Personally I have so many things that I need to do differently. Starting today.

–Riitta

Related reading:
Rachel Happe’s beautiful post: A Vision of The Social Organization
Dave Gray in Dachis blog: The Connected Company
Christoph Schmaltz  in Dachis blog:  From traditional business to social business
John Hagel’s grain of gold: Reshaping Relationships through Passion

EDIT 2011-08-02: Professor Esa Saarinen’s research can be found here.