Your Essential Guide to How to Make Robust Project Decisions

One of the challenges a new Project Manager faces is project decision-making. It is easy to find the constant stream of small decisions overwhelming. But there’s more to it than that. Some decisions are big. And getting them right is a crucial matter of good governance.

The Twin Challenges of Project Decision Making

There are two requirements for good project decision-making:

1. The need to get it right…
   in terms of accountability, transparency, and approach, to satisfy the need for good governance
2. The need to make project decisions quickly…
   to satisfy the need for speed, so you don’t hold up progress.

In this article, we are going to focus on the need for good, robust, accountable project decision-making. In our follow-up article, I take a look at how to satisfy the need for speed and make a good decision in a hurry. So, here is our agenda:

• Project Decision-Making Process Overview
• Setting Yourself Up for A Robust Decision
• Making your Project Decision
• Following Up on Your Project Decision Making
• There’s More to Project Decision Making than just Making a Decision

And then, there’s our follow-up article, ‘Rapid Project Decisions: Do You Know How to Make them with Confidence?’

Project Decision-Making Process Overview

On the face of it, the project decision-making process is simple:

• Define the problem to resolve or the decision to make
• Make the decision
• Implement it

But as the process overview below shows, there are more steps involved.

In the sections that follow, I shall divide this process into three principal stages:

1. Setting Yourself Up for A Robust Decision
   • Defining the problem
   • Identifying the decision-makers
   • Identifying the decision-making criteria
   • Listing the possible decision options
2. Making your Project Decision
   We will combine the elements of:
   • Logical, rational evaluation processes
   • Intuitive, gut-instinct processes
   • Awareness of the decision-making traps that await us
3. Following Up on Your Project Decision Making
   After you have made a project decision, there is work to do:
   • Documenting your decision and the decision-making process
   • Letting people know what decision you’ve taken and, if needed, convince them it is the right approach
   • Planning how you will implement the decision

Then, of course, it is time to implement your decision. But, of course, that is a whole other matter!

Setting Yourself Up for A Robust Decision

Like so much of life in general, and Project Management in particular, good preparation is vital for a successful outcome. So you need to set yourself up to succeed by putting the foundations of a good decision in place.

First, Define the Problem that Needs a Decision

One tip I always recommend is to think of the ultimate outcome your decision must serve. As a result, define your decision as:

How to best…

This way you achieve two things:

1. You express the decision as a practical exercise: ‘how to…’
2. You recognize that there may be no perfect solution. So you are just looking for the optimum: the ‘best’

Next, Ask Who the Right Decision Makers are

It may be you. It may be your project sponsor, client, or boss. Or it may be a decision-making group, like your Project Board, Steering Committee, or Design Authority. A decision can only be a good decision if it is taken by the right person or group of people. So you need to consider the:

• level of authority each project decision needs,
• knowledge or experience that is necessary to inform a sound decision
• governance arrangements for this aspect of your project

Now Consider the Decision Criteria

On what basis will you (or your other decision-makers) take this decision? How do you define ‘Best’? Often, this comes down to one or two of the common project concerns:

• Time
• Cost
• Quality
• Scope
• Threats
• Opportunities
• Value

The challenge comes when we recognize that what one stakeholder thinks is the vital element, is not the same for the next stakeholder. So all project decision-making is an exercise in balancing the needs, desires, and expectations of your various stakeholder groups. Often, there may be some negotiation at this stage.

A common approach is to evaluate options against a number of criteria and to determine, before the decision itself, the relative weighting of each of the criteria. For example, you may weight the criteria:

• Quality 60%
• Cost 20%
• Schedule 20%

And lastly, What are Your Options?

You can’t make a decision without options to choose from. So set out the alternatives that will best address your problem or issue. There are two things to be careful about:

1. Beware of having too many options
   This can easily cause ‘decision paralysis‘. This means the fear of getting your choice wrong will prevent you from making a decision.
2. Likewise, too few options can leave a concern that you left something out.
   Three or four is often the right number. Just two options is a dilemma. And that never feels comfortable!

Making your Project Decision

Before you make your decision, you need to evaluate the options. There are two ways of doing this, using different kinds of mental processes:

Logical Evaluation

This is an effortful, thoughtful, and conscious evaluation. We have all sorts of tools available to make rational decisions; many of them numerical. A lot of project decision-making must rely on this kind of process. Indeed, without it, you will find it hard to document the reasons for your decisions, and therefore meet the governance requirement for transparency and accountability.

Choose one or two appropriate decision-making tools to use. And then apply them with rigor.

Intuitive Evaluation

We often jump to conclusions and, nearly as often, get them wrong. Yet we all feel a compulsion sometimes to just ‘trust our gut’.

Much research has examined when it is right to do so. We are balancing here the twin pulls of :

• Our experience that sometimes intuition is powerful and correct
• The knowledge that humans are subject to all manner of cognitive biases, which lead us to make poor choices. We have videos about two of these biases:
  • It’ll Never Fly: Beat Confirmation Bias | Video
  • Avoid Sunflower Bias: Critical PM Priority | Video

Perhaps the most thorough assessment of when we can trust our intuition has been done by Gary Klein. His books Sources of Power (technical reading) and The Power of Intuition (business reading) are excellent and I recommend them both. This work also appears in the popular book, Blink, by Malcolm Gladwell. To understand the power of biases in our thinking, one of my Top 5 business book recommendations is Daniel Kahneman’s Thinking: Fast and Slow.

However, the broad conclusion of Klein’s research is simple. We can best rely on our intuitive judgments in situations where:

• We have deep experience that is highly relevant to the situation, and
• The situation is highly complex and not easily susceptible to logical analysis

But Wait! Before You Make Your Decision…

Let’s go back to those biases that Human beings are so prone to. They create all manner of decision-making traps. And Project Managers are nothing special in this regard. Sorry.

This is too big a topic, by far, to shoe-horn into this article. And I don’t doubt it’s one I will come back to. For a brief flavor of some of the ideas, check out an earlier article of ours, The Problems of Probability. As I mentioned, the best book (bar none) you can read today on this topic is Thinking: Fast and Slow, by Daniel Kahneman.

Not only did Kahneman do much of the original work in this area (he won a Nobel Prize for it), but he has observed the field from its start, participated in all its important debates, and he writes extraordinarily well. Not only that, but this book is the closest you’ll find to a comprehensive survey of the field. It’s a book any serious business professional should read.

Common biases and project decision-making traps include:

• Over-confidence in plans
• Influence by recent, prominent events
• Mis-estimation of the likelihood of extreme and dreaded risks
• Basing decisions on the first information we received
• Mis-attributing expertise in one field to someone who is an expert in a related field
• The very human tendency to see patterns where they don’t exist

By the way, Kahneman is a psychologist. And I strongly advocate that all project managers take an interest in psychology. We spend a lot of our time working with people – often under pressure. I consider an understanding of psychology to be an essential skill! Take a look at:

• Top 12 Psychologists a Project Manager Should Know About
• Positive Psychology in Business: A Review
• Power of Neuroscience: How to Harness it for Project Success
• What is Your Psychological Distance? | Video

Okay, so You have been careful…

It is now time to make your decision

What’s it to be?

Following Up on Your Project Decision Making

Decision made: job done!

Not so fast, Project Manager.

Document Your Decision

To satisfy the needs of good governance, you will also need to document your decision and the considerations around it.

One thing I recommend you keep is an archive of all critical project decisions. This can take the form of a decision log, meeting minutes, or just highlighted notes in your project notebook. But, one way or another, you need to be able to track back on any important decision, and be able to answer the typical audit questions:

• When was this decision made?
• Who made this decision?
• Under what circumstances?
• Using what criteria?
• Following what process?
• And what alternatives were considered?

So, what decisions are important enough to require documentation? The tests I would apply are impacts on scope, quality, schedule, and budget. set a threshold for each. And, if the decision could impact any of these at a level beyond that threshold, then document the decision.

Now the Work Begins: Let People Know

Who needs to know the decision you made? And who do you need to persuade that it was the right decision? Project decisions have material effects on your stakeholders, so don’t take their support for the decision for granted.

Be aware, by the way, that most decisions are a compromise. It may be the right decision for the project, taken as a whole. But, for an individual stakeholder, this may be a disappointing – even disastrous – choice!

And even when you may be right in believing people would support your decision, if they don’t know about it; how can they? What they will do instead is gossip and start rumors to fill the information gap.

And the Work Continues…

Of course, it’s tempting to get on and implement your decision straight away. But you’re a Project Manager. So, I hope you wouldn’t dive straight into implementing anything without an appropriate level of planning.

But, once you have a plan: knock yourself out!

There’s More to Project Decision Making than just Making a Decision

The art of getting project decision-making right is something most project managers evolve over their careers. We get better at it as we do more of it.

The very best decision-makers – in all arenas – do one thing that the rest do not…

They keep records, and they review their decisions. The best decision-makers record every decision they make, along with the thinking process behind those decisions. They then periodically review their decisions and the outcomes. They compare what actually happened with any assumptions they made. And they try to unpick what made their decision either right or wrong in retrospect. Then, they draw lessons that they try to apply to their future decision-making.

Will you do this?

What are Your Project Decision-Making Lessons?

Please use the comments section below to share what you have learned, and I will comment on all contributions.

For more tips and ideas, take a look at our video, Better Decision-making and More Robust Choices – Top 10 Tips.