Against the background of the fast pace changing business space, ability to be agile in decision-making and implementation has become imperative. This was the focal point of a thought leadership series which held in Lagos. Olaseni Durojaiye reports
Given the high level of competitiveness among businesses globally, and in the rivalry to attract both portfolio investors and foreign direct investments (FDI) among countries, one of the challenges that business and political leaders are now faced with is how to contend with a fast paced, decision-making landscape to remain ahead of competition.
The challenge that this posed, has transported VUCA into the business and political space. VUCA, an acronym for Volatile, Uncertain, Complex and Ambiguous, was once an exclusive acronym used by the American Military to describe extreme conditions in Afghanistan and Iraq. Today, VUCA has become the buzz word among senior leaders and aptly expresses the fact that the rate of change is outpacing the ability of economies, businesses, industries and people to adapt.
Remarkably so, political and business leaders are trying to make sense of the fast paced decision making landscape they are faced with. Dependence on intuition, belief and values for decision making are giving way to newer mental models based on agility, critical thinking, adaptable learning, people orientation and responsiveness to change.
Yet in this increasingly volatile, uncertain, complex and ambiguous environment, political and business leaders continue to make wrong decisions plunging their economies into recession and their corporations into bankruptcy.
The Future of Executive Decision Making
The importance of making right judgment call and avoiding the dilemma of plunging businesses and nations into peril assumed the front burner of discourse at the CGMA Speak Series, which held in Lagos. The series which is a thought leadership forum was organized by the Chartered Institute of Management Accountants, the world’s largest professional body of management accountants, in conjunction with Philips Consulting, to brainstorm on the problems and proffer solutions to the decision-making process undertaken regularly by senior leaders.
The theme of the event was “Joining the Dots: The Future of Executive Decision Making.”
The CGMA Speaks Series focused on a research jointly commissioned by CIMA and the American Institute of Certified Public Accountants (AICPA), the world’s largest association representing the accounting profession, to investigate the effectiveness of decision-making practices in large organisations by C-level administrators in 16 countries.
The research report, which was released in 2016, identified five major problems which companies are struggling to deal with namely; overcoming bureaucracy and achieving agile decision making, building greater levels of trust and improving collaboration, balancing short, medium, and long-term view and define the right metrics, translating huge volumes of data into strategic insight, and building the decision-making skills of senior leaders.
Experts Share Insights
The CGMA Speaks Series had in attendance high-profile corporate executives from both indigenous and multinational companies, who shared their insights on current business issues and corporate strategies about the context of today’s business environment in Nigeria and across the world.
Delivering a keynote address, President, CIMA, Andrew Miskin, said the mode of communication in business globally has transformed as a result of the invention and development of the internet and technology, with real-time data now easily accessible to obtain and sharing of business information now a broad two-way process.
He, however, noted that despite the presence of abundant data, interpretation of information has become less clear today because of the overload of records.
‘We have real-time information about what is happening in our places of organisations, we have real-time information about what is happening in our businesses, yet we cannot have real-time assistance with data. That gives us a very different view in terms of what decision-making can achieve and we are going to have a lot to respond to that as accountants because we are not comfortable with that”, he said.
Noting that we are in the era of decision relevance in business, Miskin said; “We have got to think about how we make those decisions relevant, and also in terms of decisions, we have got to think about what information is really needed. The question is: ‘what is it you want to decide that changes the information you want?’”
Also speaking, Chairman and Chief Executive Officer, Phillips Consulting, Folusho Phillips, stated that while making relevant decisions is important, the ability to articulate, make, and execute decisions quickly is also a key component in the decision-making process.
“Yes, we’ve got to take good decisions, but once we do take a decision, it is the speed of execution that matters because the manner with which you use to execute such decision that would determine the outcome of such programme or plan. It goes beyond taking the decision at the right time; it’s about implementing and making sure that you make that decision relevant. Take good decisions quickly and there is the need to execute it in time”, he said.
On her part, Deputy Managing Director, NEM Insurance, Abisola Giwa-Osagie, said the operating models in organisations, both private and public, need to be simplified in order to reduce the bureaucratic mechanism, which is an impediment in the decision-making process.
She said; “It is important for us to know that we need to simplify our operational models. Any system that has a model that is laden cannot be efficient. We need to delegate, we need to empower our people, and we need to trust the decisions that they take. That is very important.”
The Chief Investment Officer and Director, Finance & Investments, Heirs Holding Plc, Sam Nwanze, who also spoke at the event, emphasised the need for organisations to entrench a culture of innovation and excellence in their workplaces to enable them to achieve their goals.
“One of the important roles of leadership in an organisation is the shaping of culture and culture has a very strong impact on how an organisation is perceived, but also how decisions are made within an organisation and how the organisation functions. Everybody is driven by a culture that is geared towards achieving the goals of an organisation. The culture that is set up helps employees to place trust and commitment in how an organisation would eventually function and achieve its goals.
“If you have a culture where people feel to get certain things, you would have to please certain people or is not merit driven, or is not driven by the objective that was set out fully; and these are things that are set from the tone of the leadership, then it completely breaks down and it’s only a matter of time before you see that that organisation is not functioning”, he added.