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Top1. Introduction
This paper focuses on senior executive strategic decision making (SESDM) where the individuals work on strategic decisions, the long-term plans that shape and form the enterprise. The decision making of senior executives (McKay et al., 2015) does not match the typical decision making made at the operational or tactical levels of an organization (McKay et al., 1992). At these lower levels within the decision hierarchy, an individual can have sufficient chances to make ‘similar’ decisions such that the deliberate practice noted by Ericsson et al. (1993) can take effect. Many of the operational, day-to-day decisions might be made in seconds, minutes, or hours, often by a single individual charged with getting the job done, with the authority to make the decision.
At the senior levels of an organization: i) the variety of decisions is greater, ranging from legal, marketing, facility location, organization design, mergers, acquisitions, expansion, contraction, new product/service offerings, overarching policies, etc., ii) the uncertainty is higher, many elements are out of the control of the executive, company, iii) the risks and impacts are greater and the future of the company can be at stake, iv) there are longer time durations between similar decisions, v) there can be extended time horizons between the time when the decision is made and observable results, vi) the risks and impacts may take place on a longer time horizon, vii) there might actually be many people involved in the decision making over a long period, viii) the people might be transient with possibly one or more roles or interactions, and ix) the decisions are usually subject to Board oversight, multiple layers of approval.
The first three points noted in the above paragraph are about the decision itself. These are commonly discussed. The remaining six points are structural aspects that reflect the nature of strategic decisions and are rarely discussed in the literature. This list of nine characteristics highlights the difference between routine operational and strategic decisions which we define as longitudinal decision making. Figures 1 and 2 illustrate the difference between individual, routine types of operational decisions, and what the senior executive decision process can look like.
In Figure 1, there are four key decision points: 1) the individual may or may not be given the situation to make the decision about, e.g., decides that groceries must be purchased or might be explicitly asked to decide about groceries, 2) decides if any groceries are needed, 3) thinks about the solutions, ranging from no groceries are needed to a full grocery list, 4) and finally if there is enough demand to warrant a trip, or if the decision maker should wait till there is more to buy. A family member might be involved, but many individuals make grocery decisions as the sole decision maker.
Figure 1. Individual, operational decision process: Seconds, minutes, hours
In contrast, Figure 2 illustrates the executive’s situation. The happy face indicates the position of the senior executive in the process and each of the key decision milestones: 1) identification, 2) decision to proceed with the decision process, 3) analysis, 4) decision to proceed, 5) solution development, evaluation, 6) and the final go/no-go decision.
The executive: i) might or might not be the only player in the process, ii) might or might not actually be active in the process (doing vs listening), and iii) might or might not be have the final say on the decision to proceed.
Figure 2. Strategic, senior executive decision making: Weeks, months, years