80% of organisational problems are created in the boardroom
Post covid- 19 reality requires us to change many gears and constructively introspect ourselves without fear so that we shape a better world for ourselves and future generations.
Critical decisions have to be made and one of them is to stop management from continuing to create 80 percent of organisational problems through poor decisions made in management meetings.
Research indicates that 20 to 40 percent of the annual corporate budgets cover the cost of poor quality and this is an obvious sign that there is a gap in the way management plans and makes decisions.
In this modern era, it is shocking to still see management making decisions based on their opinions and feelings as opposed to facts despite the plethora of research that has been conducted.
As a result of this poor practice, management ends up solving symptoms of problems or making decisions completely parallel to the realities of their organisations and this should be strongly discouraged and condemned.
This habit of making poor decisions has become a culture that has resulted in perennial problems leading to the current despondency and declining international rankings of our country.
Every ill- conceived decision multiplies into problems and in the private sector, some of the apparent problems include a decrease in sales volume, increase in operational costs, decrease in profits, and high cost of poor quality with the most obvious one being a reduction in market share.
Whereas in the public sector, bad decisions made in the boardrooms culminate in high cost of living, reduction in the lifespan of citizens, increasing social ills and immorality and compromised livelihood of Batswana.
To get out of this crisis we need a paradigm shift in the management approach we have been using to plan and make decisions.
While the world is using fourth industrial revolution decision- making tools and mental models, Africa and Botswana are still using first and second industrial revolution tools and mental models that are outdated and that cause these constant organsational problems.
The new paradigm approach that I am advocating for requires us to adopt new patterns of thinking, management tools, techniques, systems, and models when making decisions and start embracing best international practices. The current effective decision- making tools that produce quality decisions are Kepner Tregoe, process decision program chart, five whys, fault tree analysis, Pareto 80/ 20 rule, logic model, and force field analysis model amongst many others.
These tools can be used effectively when management has a better mental edge and this introduces us to decision- making mental models.
A mental model represents the state or picture of reality that management carries in their minds and that influences how they reason and act.
When management has a better mental edge they are able to understand the context of their problems, the information they use, and the opportunities at their disposal, and develop a plan of action that improves their performance.
Therefore, it is important to have management with different modern mental models lens and one of them is the inversion thinking tool which requires management to flip the situation or problem at hand and address it from the end rather than using the forward natural starting point approach.
For example, instead of following the scientific problem approach of addressing poor service delivery using the causality model, ask yourself what could happen if the situation remains unaddressed and that will create different opportunities for addressing the situation at hand.
Moreover, another highly effective decision- making pattern of thinking is the Hard Choice Mental Model which requires management to thoroughly understand the opportunity, problem, or challenge that they are facing before making decisions so that they have common logic thinking of making accurate decisions.
For instance, before making strategic structural decisions management should adopt system thinking and see the organisation as a whole and how their decisions will affect different interconnected parts.
Furthermore, the complexity of the modern business environment requires the use of the Iceberg Mental Model which wants management to identify the four levels of reality: events, patterns of behaviour, systems, and patterns of thinking in an organisation so that they can use inductive and deductive reasoning to make best organisational strategic decisions.
It is not wise for management to focus on events alone and ignore patterns of behaviour that cause such events because that is how they solve symptoms of problems instead of the actual problems.
For instance, a decrease in sales volume or poor customer service might be a sign of disengaged employees who are disgruntled and not motivated to produce quality results.
Lastly, management should have a feedback loop system by designing a system that provides them with reliable data and information on how far they are in attaining organisational goals because it enables them to make quality decisions consistently.