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JWI510_WK6_LectureNotes_1194.pdf
JWI 510: Leadership in the 21st Century Lecture Notes
© Strayer University. All Rights Reserved. This document contains Strayer University confidential and proprietary information and may not be copied, further distributed, or otherwise disclosed, in whole or in part, without the expressed written permission of Strayer University. JWI 510 – Lecture Notes (1194) Page 1 of 3
Week 6: Leadership and Decision Making
Leaders are heavily relied upon for their ability to make decisions, especially during stressful times. As you develop your leadership skills, you may be wondering if there are models or techniques that can aid you during such times. Thankfully, there are. One such model is the Vroom-Yetton Contingency Model. Inasmuch as any single model can guide an organization as large and as diverse as GE, this framework does offer a compelling approach. The formula, which management theorists like Maier (1970) and Tannenbaum and Schmidt (1958) first used to great advantage, was the intellectual driver for the work Jack accomplished at GE. During 1981–1988, the first seven years that Jack served as CEO, he worked on activities such as downsizing, de-layering, and divestiture of unprofitable businesses. It was during this phase that Welch declared that GE’s businesses would be Number 1 or Number 2 in any market they were in, or he would "fix, sell, or close" them. By late 1988, Jack's efforts had dramatically improved the quality of GE’s systems and processes.
The Vroom-Yetton Contingency Model
The three main questions we will begin with are:
1. What is the Vroom-Yetton Contingency Model?
2. How do we use it?
3. To what extent should a leader involve employees in the decision making process?
The equation that underpins Vroom’s model is one of the most powerful tools in the leadership toolkit. The formula posits that the quality of any decision, when multiplied by its level of acceptance, will determine its effectiveness. Restated, the formula becomes:
Q x A = E The multiplication sign in the equation is not meant to be taken literally. Its main purpose is to serve as a reminder, as hard-charging business people all too often forget, that anything times zero is zero. A super- brilliant idea (high Q) that team members will hate, oppose, and subvert (low A) is a poor idea; a leader should think long and hard about how to modify the idea to get more employee (or customer) buy-in, even if some decision quality must be sacrificed. Conversely, the tendency to just do it if it feels good, without regard for the wisdom of an idea, will usually produce a high A / low Q outcome that is similarly disappointing.
JWI 510: Leadership in the 21st Century Lecture Notes
© Strayer University. All Rights Reserved. This document contains Strayer University confidential and proprietary information and may not be copied, further distributed, or otherwise disclosed, in whole or in part, without the expressed written permission of Strayer University. JWI 510 – Lecture Notes (1194) Page 2 of 3
Since its inception, nearly 40 years ago, the Vroom-Yetton Model has been improved many times, but the centrality of the leader's analysis of a particular situation, with a focus on decision quality and acceptance, remains the same. A series of questions are asked to drive the analysis, such as:
• Quality Requirement How important is the technical quality of the decision? Is there an optimal solution to a problem, say, from a technical standpoint?
• Leader Information Does a leader have sufficient information to make a high-quality decision?
• Problem Structure Is the problem well structured? Is it clear and well defined? Does it lend itself to statistical tools and quantitative analysis?
• Commitment Requirement Is employee commitment to the decision critical for effective implementation?
• Commitment Probability If the leader makes the decision without employees' input, is it reasonably certain that people will not be committed to the decision?
• Goal Congruence Do employees share the organizational goals to be attained in solving the problem?
• Employee Conflict Is conflict among employees likely to occur in the preferred solutions?
Depending on how these questions are answered, the model directs leaders to:
A. Make the decision alone, either with or without obtaining relevant information from subordinates
B. Share the problem with your team and get their ideas, either one-on-one or in a group, before making the decision
C. Present the problem to the group, and inform them that, if they can agree on a solution, it will be accepted. The model reminds us that one of a leader’s key responsibilities is to determine, with each new decision, whether to go it alone or bring people into the process.
JWI 510: Leadership in the 21st Century Lecture Notes
© Strayer University. All Rights Reserved. This document contains Strayer University confidential and proprietary information and may not be copied, further distributed, or otherwise disclosed, in whole or in part, without the expressed written permission of Strayer University. JWI 510 – Lecture Notes (1194) Page 3 of 3
The model works best when the facts pertaining to the quality and acceptance of decisions are known and readily available. In many cases, the likely quality and acceptability of a decision cannot be known in advance. In these situations, even the most data-driven leaders should be comfortable relying on their own instincts. Vroom and Yetton’s model is yet another starting point on your journey of self- understanding. As you practice leadership, remember that how you make decisions has an undeniable impact on your effectiveness. Think – and plan – before you act.
Your Leadership Journey
• If you are new to leadership, review the hidden traps of decision-making, so you are prepared if you see them arise
• If you are a team leader, apply the Five Dysfunctions of a Team to your own team, and see where it has the potential to reinvent itself
• If you are a senior/veteran leader, consider the applicability of the Vroom-Yetton Contingency Model to your decision-making
TheVroomYettonDecisonModel.pdf
The Vroom-Yetton Decision Model Deciding How to Decide
Steer your decision-making process in the right direction.
There are lots of different ways of making a decision, and choosing your approach can be just as difficult as making the decision itself!
Sometimes you have to take charge, and decide what to do on your own, but you don't want to appear autocratic to your team (particularly in situations where you need their input). At other times it's better to make a decision based on the group consensus, but this can use up precious time and resources. So how do you decide which approach is best?
Every manager needs to be able to make good decisions . A systematic approach to decision making, such as the Vroom-Yetton Decision Model, allows you to bring consistency and order to a process that might otherwise feel idiosyncratic and instinctive. It can also help you to determine the most effective means of reaching a decision.
Understanding the Model The Vroom-Yetton model is designed to help you to identify the best decision-making approach and leadership style to take, based on your current situation. It was originally developed by Victor Vroom and Philip Yetton in their 1973 book, "Leadership and Decision Making." [1]
No single decision-making process fits every scenario. Instead, Vroom-Yetton offers a number of different processes and directs you toward the best one for your situation. For example, if speed and decisiveness are required then it will likely point you toward an autocratic process. If collaboration is what's needed, then it will nudge you toward a more democratic process. Researchers have found that managers are more effective, and their teams more productive and satisfied, when they follow the model. [2][3] The simplicity of Vroom-Yetton also means that anyone – from the boardroom to the factory floor – can use it.
Although a little long-winded at times, it can be particularly helpful in new or unusual situations. Practice using it, and you'll quickly get a feel for the right approach to take, whether you're making a decision about a day-to-day issue or dealing with a more complex problem.
Before you start using the model, you'll need to consider these three factors:
• Decision quality – Sometimes, making the "right" decision is critical, and you'll need to use a large number of resources (people, time, information, and so on) to ensure that the action you take has been well thought through and is of high quality.
• Team commitment – Some of your decisions will have a major impact on your team, while others will go unnoticed. When a decision will likely impact your team, it's best to use a collaborative process. This will improve the quality of the decision, and you'll likely deliver a successful result faster.
• Time constraints – When the issue at hand isn't time sensitive, you have more "space" to research your options and to include others, which will help to boost the quality of your decision. If your time is limited, however, it may not be feasible to include others or to undertake thorough research.
Specific Leadership Processes Figure 1, below, shows the Vroom-Yetton model. The framework poses seven "yes/no" questions, which you need to answer to find the best decision-making process for your situation.
As you answer each of the questions, you work your way through a decision tree until you arrive at a code (A1, A2, C1, C2, or G2). This code identifies the best decision-making process for you and your team. (Note that, in some scenarios, you won't need to answer all of the questions.)
Figure 1: The Vroom-Yetton Decision Model
The Vroom-Yetton Decision Tree: Adapted from Leadership and Decision Making by Victor H. Vroom and Philip W. Yetton by permission of the University of Pittsburgh Press. Copyright © 1973 University of Pittsburgh Press.
The following codes represent the five decision-making processes that are described by the model:
Autocratic (A1): You use the information that you already have to make the decision, without requiring any further input from your team. Autocratic (A2): You consult your team to obtain specific information that you need, and then you make the final decision. Consultative (C1): You inform your team of the situation and ask for members' opinions individually, but you don't bring the group together for a discussion. You make the final decision. Consultative (C2): You get your team together for a group discussion about the issue and to seek their suggestions, but you still make the final decision by yourself. Collaborative (G2): You work with your team to reach a group consensus . Your role is mostly facilitative, and you help team members to reach a decision that they all agree on. In general, a consultative or collaborative style is most appropriate when:
• You need information from others to solve a problem.
• The problem can't be easily defined.
• Team members' buy-in to the decision is important.
• You have enough time available to manage a group decision.
An autocratic style is most appropriate when:
• You have greater expertise on the subject than others.
• You are confident about acting alone.
• The team will accept your decision.
• There is little time available.
Note: Vroom-Yetton is a useful model, but it's not necessarily appropriate for all eventualities. It misses out several important considerations, and its rigid structure means that it fails to take into account subtleties, such as the emotions and dynamics of your team, and the task’s complexity. The seven questions are imprecise, too – "importance" and "quality," for example, are vague terms – and it can be difficult to give straight "yes" or "no" answers to them.
Vroom and Arthur Jago addressed these weaknesses and amended the original model in their 1988 book, "The New Leadership." [4] The newer model is more complex and includes several additional questions, which allow users to take other constraints, such as geographic location, into account when making their decision. It also uses a mathematical formula to help people to pinpoint the optimum decision-making process for their situation. The newer version of the model is often referred to as either Vroom-Jago or Vroom-Yetton-Jago.
Key Points The underlying assumption of the Vroom-Yetton Decision Model is that no single leadership style or decision-making process fits all situations.
To find the process best suited to your situation, you need to consider a number of factors. These include time constraints, the level of team participation required, and the quality of the final decision.
The model walks you through these factors logically, to help you to identify the most appropriate process and style. It is particularly useful for managers and leaders who are trying to balance the benefits of participative management with the need to make decisions effectively.
Infographic You can see our infographic of the Vroom-Yetton Model here:
- The Vroom-Yetton Decision Model
- Deciding How to Decide
- Understanding the Model
- Specific Leadership Processes
- Figure 1: The Vroom-Yetton Decision Model
- Note:
- Key Points
- Infographic
- Quick Question
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