Decision Fatigue and Its Impact on Leadership Effectiveness

In today’s world the speed of change is only increasing. Change is at an all-time high and leaders are faced with more decisions than ever before in history. With the increasing number of decisions for leaders their overall effeteness can be effected. This trend can be clearly depicted by the opening statement form the article The Creed For Speed within the December 5th 2015 issue of The Economist where they stated that “A CUSTOMER downloads an app from Apple every millisecond. The firm sells 1,000 iPhones, iPads or Macs every couple of minutes.” (Economist 2015) The problem is that leaders are needing to make not only decisions more frequently than before but also many of the decisions have larger impacts as well. This research will focus on better understanding the connection between the increasing number and complexity of decisions with the overall effectiveness of leaders.

Understanding the links between these two important and changing areas is becoming more important than ever before. It is critical for our leaders to be as effective as possible and also be able to handle any situation that is thrown at them. This can be evidenced by a simple web search for leadership effectiveness, the results include such pages as “7 Habits of Highly Effective Leaders” and “6 Strategies to Improve your Leadership Effectiveness” While much research has been conducted on both subject areas there is limited research that looks at the intersection of the two.

With leadership being pushed at every level of organizations it could be said that there are more leaders today than there ever have been at any other point in history. This research will focus on three main areas; what is decision fatigue, what is the impacts on leadership effectiveness due to decision fatigue, and what can be done to prevent decision fatigue. Through these three areas of research connections drawn along with a final conclusion on the impact of increased decisions on overall leadership effectiveness.

With these two elements at historic highs, leaders and decisions that need to be made, there is more opportunity for leadership to fail. Know what effects and correlations exist can help increase the overall effectives of leaders.

Although the concept of decision fatigue is discussed it is mostly been observed within the medical profession related to the length of shifts for doctors. With this becoming a more widely discussed issue it is important for more focus to be placed on the impacts this has on business professionals. As Tierney wrote in the New York Times in 2011:

Decision fatigue helps explain why ordinarily sensible people get angry at colleagues and families, splurge on clothes, buy junk food at the supermarket and can’t resist the dealer’s offer to rustproof their new car. No matter how rational and high-minded you try to be, you can’t make decision after decision without paying a biological price. (Tierney 2011)

The concept of decision fatigue has many different definitions but Tierney summarizes the essence of what it means and how it can impact other aspects of the affected person’s life. Tierney goes on to state that when you are fatigued from decision making “You start to resist any change, any potentially risky move” (Tierney 2011) This is one of the highlighting factors for the importance of this research as the lack of behavior could potentially cause negative effects based on the type of decisions that need to be made.

This research will provide a comprehensive review of the already existing literature that exists on this topic. The research will also serve as a starting point for further quantitative based research regarding decision fatigue and leadership effectiveness. This research will not contain any experimental based observations.

Much research exists regarding decision fatigue within the medical professional vertical there is limited research connecting the concept of decision fatigue with overall leadership effectiveness. The researched literature can be broken into three major source categories; contemporary speakers, peer reviewed articles, and periodical based articles. Utilizing these three different perspectives on the concept of decision fatigue and its supporting sub-concepts will provide a rounded viewpoint.

The research looked at overall decision making, general fatigue and leadership effectiveness as sub-concepts. These sub-concepts were most prevalent within the peer reviewed journal articles with the major concept of decision fatigue being most prevalent in the periodical articles as well as the contemporary speakers. Additional concepts were researched for supporting context.

The research did not focus on the biological impacts or other secondary impacts that decision fatigue may or may not cause. Within the research there is mention of biological impacts at play when the concept of decision fatigue is active. This area was outside the overall scope of this research and was not separately researched. Additionally, the non-direct impacts of making decisions while suffering from decision fatigue were not researched.

Overall leadership can be defined in many different ways and therefore leadership effectiveness can be defined many ways as well. An interview conducted with a Senior Vice President of the Allstate Corporation, Pete, provided a list of the top attributes that a leader must have. The attributes listed were: vision, results, customer and people focused, strategic, ability to deal with conflict, communication, trust, and decision making. Having decision making as a top attribute that this senior officer of a fortune 100 company stated as being critical to being a leader underscores its importance.

Leadership effectiveness can be best defined as the ability that one has to influence others to achieve a common goal. However, “Contextual factors can determine the magnitude of influence leader behaviors will have on employee work outcomes” (Carter, Armenakis, Feild, & Mossholder, 2012, Pg. 945). With contextual factors impacting the magnitude of influence and rate the overall effectiveness of a leader there are many different models that have been created. Each model has its own set of factors that the leader is rated on and ultimately though similar render different ratings and definitions for what an effective leader is. For context below are two examples of different leadership effectiveness models.

Figure 3.1 HOP Associates Workforce Engagement Model

Figure 3.2 JQA Leadership Effectiveness Model

JQA (John Queripel Associates) the producer of the above model expands the definition of leadership effectiveness to state that “Effective leaders develop a level of self-awareness and a capacity to monitor their own learning and development because they know that leadership attributes can be defined, learned, practised, improved and passed on to others.” (JQA 2016) As seen in both models and the definition of leadership effectiveness there are key inputs to what makes a leader effective.

Effectiveness of leadership and change are two concepts that are closely related in the research there are many acritical that highlight that change is occurring now more than ever before in any time in history. This point is confirmed by the research conducted by Carter, Armenakis, Feild, and Mossholder that was published in the Journal of Organizational Behavior

Among various leadership perspectives, transformational leadership is often linked with managerial effectiveness during organizational change (Bass & Riggio, 2006; Pawar & Eastman, 1997). Transformational leaders recognize the need for change, create and share compelling visions with employees, guide them through adaptations, and inspire them to accomplish the challenging goal of institutionalizing change (Bass, 1999). (Carter, Armenakis, Feild, & Mossholder, 2012, Pg. 942)

In this the authors are not only stating that through many different and varied leadership perspectives managerial effectiveness or leadership effectiveness is linked with transformational leadership in times of change but those times of change might be additionally brought on by the transformational leaders are they more readily recognize the need for change and can share their vision effectively.

Both leadership effectiveness as well as decision making can be seen as needed to be an exact science. In an article published in the Physician Leadership Journal they quoted a Q&A held on Amazon.com with the authors of the book Decisive and Made to Stick. The quote was “Being decisive isn’t about making the perfect decision every time,” he and co-author and brother Dan Heath say in a Q&A on Amazon. com. “It’s about being confident that we’ve considered the right things, that we’ve used a smart process.” (Physician Leadership Journal 2014) This quotation contradicts the viewpoint of leadership effectiveness and decision making as an exact science.

Regardless of the fatigue and quality of decisions that were made the ability to learn from those such experiences is invaluable. It can be argued that when an individual is exposed to a greater quantity of different situations then they have a greater overall ability to lead since they have learned from those experiences. This is explored by Development and Learning in Organizations in 2005 where they stated that

Leaders in such challenging, high-profile roles who have to make decisions which can literally involve life or death outcomes are very experienced. In common with leaders in other organizations, they’ve faced situations from which they have learned lessons. Their experiences have grown, their abilities to do the job have been honed, they’ve earned their stripes, they’ve faced seemingly impossible situations, but dealt with them and are better leaders for it. But are they? It may be assumed, but it’s certainly not true, that everyone learns from their experiences, or learns from their mistakes. Different people learn different things, and not all of them learn the right things. (Development and Learning in Organizations, 2005)

With the viewpoint of not everyone learns from their past decisions and or their failures with those decisions could lead to the inverse correlation to the number of decisions and the overall leadership effectiveness because not all leaders will learn from the past decisions being made.

As Tierney defined in the New York Times in 2011 “Decision fatigue helps explain why… No matter how rational and high-minded you try to be, you can’t make decision after decision without paying a biological price.” (Tierney 2011) Schwartz adds that:

The simple act of making decisions, says the researcher Roy Baumeister, progressively depletes our ability to make them well. We begin to experience something called “decision fatigue.” Worse yet, we’re often not even consciously aware of feeling tired and impaired. Here’s how the brain compensates: As much as 95 percent of the time, it makes decisions automatically, by habit, or in reaction to an external demand. (T. Schwartz 2012)

The biological price that Tierney stated and Schwartz expanded on of not only feeling tiered and impaired but also the fact because there is such a high toll on the brain that automatically it makes up to 95% of the decisions from a place of habit or reaction can have a significant impact on a leader’s ability to be effective.

With the brain running on an automatic based system when taxed the baseline of an individual for how they make decisions and how their past experiences have impacted them plays a larger role in their decision making ability. In the research conducted by Dewberry, Juanchich, and Narendran in Decision-making competence in everyday life: The roles of general cognitive styles, decision-making styles and personality they found that “Results indicate that personality variables explain a significant and substantial amount of variance in decision-making competence over and above cognitive and decision-making style variables. (Dewberry, Juanchich, & Narendran, 2013) With personality variables having a significant impact of the competence of decision making there is a large amount of variation in personality variables, greater than decision making styles.

Beyond personality styles and decision making styles the training and exposer that an individual is exposed to can have a significant impact on their speed and ability to make a decision. In research conducted at The University of Rochester by Daphne Bavelier, Alexandre Pouget, and C. Shawn Green it was found when individuals were trained utilizing a video game system with a verity of different games that

Action game players were up to 25 percent faster at coming to a conclusion and answered just as many questions correctly as their strategy game playing peers… “It’s not the case that the action game players are trigger-happy and less accurate: They are just as accurate and also faster,” Bavelier said. “Action game players make more correct decisions per unit time. (University of Rochester, 2010)

This research further signified the vast difference that individuals have in training and how it can greatly impact their baseline response when decision fatigue sets in.

Within typical corporations there are many levels of process to decision making. At the highest level of the CEO and the management team there are many strategic decisions that are made on a daily basis. Carmeli, Tishler, and Edmondson stated in their research of this topic that:

Evidence suggests that senior executives and their management teams fail frequently and often remarkably when making strategic choices (Nutt, 2002, 2004), in part because executive teams face decisions that are both ill-structured and complex (Edmondson et al., 2003a; Eisenhardt, 1999). (Carmeli, Tishler, & Edmondson, 2012)

This assertion of failure to the fact that the strategic decisions is due to the structure and complexity of the decision further highlights the concept of decision fatigue in that if there were fewer decisions that need to be made they could not only be better structured but the complexity could be combated with the addition of more background knowledge for the executive.

In a presentation from 2005 Berry Schwartz outlined the highlights from his book The paradox of choice. This presentation centered around the concept of how having greater options can lead to greater dissatisfaction. This also draws strong parallels to the effects of decision fatigue. With more decisions to be made the satisfaction is reduced with each decision. These increasing choices lead to a greater number of opportunity costs. Schwartz states that “Opportunity costs subtract from the satisfaction we get out of what we choose, even when what we choose is terrific. And the more options there are to consider, the more attractive features of these options are going to be reflected by us as opportunity costs.” (B. Schwartz 2005).

When looking at the overall concept of decision fatigue it is critical to separate the fatigue for the decision its self and the fatigue that is realized due to the process of making the decision. Decision fatigue is caused by a natural biological response in the brain and as Schwartz stated “The answer begins with self-awareness. Our first challenge is resist being reactive. Many of our worst decisions occur after we’ve been triggered — meaning that something or someone pushes us into negative emotion and we react instinctively, fueled by our stress hormones, in a state of fight or flight.” (T. Schwartz 2012). Decision fatigue based on the ligature can lead to reduced leadership quality. With decision fatigue being a known influencer of leadership effectiveness it is critical for leaders to be aware that this is occurring. As Tierney stated when suffering from decision fatigue “You start to resist any change, any potentially risky move” (Tierney 2011) These are warning signs that a leader is being effected by decision fatigue.

Through there is little to no data supported a strong connection between these concepts a research based connection can be made. As the research showed the way that decisions are made have little to no impact on the quality or impact on decision fatigue. As Dewberry, Juanchich, and Narendran “personality variables explain a significant and substantial amount of variance in decision-making competence” (Dewberry, Juanchich, & Narendran, 2013).

Overall decision fatigue has been increasing as more possibilities become available. Berry Schwartz stated it best “if …everything is possible, you don’t have freedom. You have paralysis. If …everything is possible, you decrease satisfaction. You increase paralysis, and you decrease satisfaction.” (B. Schwartz 2005).

References

Carmeli, A., Tishler, A., & Edmondson, A. C. (2012). CEO relational leadership and strategic decision quality in top management teams: The role of team trust and learning from failure. Strategic Organization, 10(1), 31–54. doi:10.1177/1476127011434797

Carter, M. Z., Armenakis, A. A., Feild, H. S., & Mossholder, K. W. (2012, August 30). Transformational leadership, relationship quality, and employee performance during continuous incremental organizational change. Journal of Organizational Behavior, 942–958. doi:10.1002/job.1824

Corrigan, P. (2016, April 5). Leadership Interview [Personal interview].

Dewberry, C., Juanchich, M., & Narendran, S. (2013, June 17). Decision-making competence in everyday life: The roles of general cognitive styles, decision-making styles and personality. Personality and Individual Differences, 55(7), 783–788. doi:10.1016/j.paid.2013.06.012

Life and death of leadership decisions. (2005). Development and Learning in Organizations, 19(4), 23–26. Retrieved from http://search.proquest.com.ezproxy.lib.purdue.edu/docview/218801886?accountid=13360

MAKE ‘DECISIVE’ LEADERSHIP DECISIONS. (2014). Physician Leadership Journal, 1(2), 76. Retrieved from http://search.proquest.com.ezproxy.lib.purdue.edu/docview/1699520847?accountid=13360

Schwartz:, B. (2005, July). The paradox of choice. Retrieved November 04, 2016, from http://www.ted.com/talks/barry_schwartz_on_the_paradox_of_choice

Schwartz, T. (2012, March 21). Three Keys to (Much) Better Decisions. Retrieved November 04, 2016, from https://hbr.org/2012/03/three-keys-to-much-better-deci.html

The creed of speed. (2015, December 05). Retrieved November 04, 2016, from http://www.economist.com/news/briefing/21679448-pace-business-really-getting-quicker-creed-speed

Tierney, J. (2011, August 17). Do You Suffer From Decision Fatigue? Retrieved November 04, 2016, from http://www.nytimes.com/2011/08/21/magazine/do-you-suffer-from-decision-fatigue.html

University of Rochester. (2010, September 13). Video games lead to faster decisions that are no less accurate [Press release]. EurekAlert! Retrieved from https://www.eurekalert.org/pub_releases/2010-09/uor-