Human Resource Management

HRM Guide World HRM Guide USA HRM Guide UK About HRM Guide Student HRM Jobs/Careers HR Updates Facebook
HRM Guide Updates
Search all of HRM Guide

Strategic Mistakes

March 10 2020 - Research from Nyenrode Business University in the Netherlands found that more than half of all strategic decisions taken by directors turned out to be mistakes,

The study conducted by PhD student Joep Steffes found three main reasons for wrong decisions:

  • Time constraints
  • Not having all necessary information
  • Bias, causing important decisions to be made on 'gut' feelings, rather than reason

Joep Steffes argues that important decisions, such as whether or not to enter a new market or to pursue a merger, need more thought than average decision. Directors should not rely on automatic actions, speed, and intuition.

Steffes points to research from former Harvard Business School professor Clayton Christensen who found that. 30,000 new products are launched every year but 80% of these fail as a result of poor decision making.

According to Joep Steffes:

"Businesses need to ensure that their directors are making fully-informed decisions by selecting directors based on cognitive capabilities and critical thinking skills. They have to put more cognitive effort in the decision-making process. They need to have decision governance structures and responsibilities in place which effects how decisions are made and that monitor the decision-making process."

Joep Steffes considers that poor decision making among directors could be result from homogeneous boards and non-diverse thinking. Steffes said:

"The position of director would often be passed on to those in the 'old boys' network' rather than a candidate who is more qualified.

"However, this doesn't work anymore. Directors need to have real knowledge and expertise to be able to do this role, they need to fully understand how the behavioural process works."

Steffes concludes that:

""If a company is more responsive to the behaviour of directors in this capacity, it leads to better decisions which can not only be of value to shareholders and the organisation but can bring social benefits too.

More HR Strategy Articles



 
 
Ebay
 
  HR Books on Ebay UK
 
  HR Books on Ebay USA
 
  HR Books on Ebay Canada
 
  HR Books on Ebay Australia
 
 

Successful Onboarding

Successful Onboarding: Strategies to Unlock Hidden Value Within Your Organization Mark Stein and Lilith Christiansen
  Fact: 1/3rd of all external hires are no longer with the organization after 2 years. What can you do about it? In a word: onboarding.
  More information and prices from:
Amazon.com - US dollars
Amazon.ca - Canadian dollars
Amazon.co.uk - British pounds
Amazon.de - Euros
Amazon.fr - Euros


The HR Answer Book

The HR Answer Book: An Indispensable Guide for Managers and Human Resources Professionals by Shawn A. Smith, Rebecca A. Mazin
  The HR Answer Book addresses 200 questions that every employer needs to deal with. Accessible and concise on-the-job companion.
  More information and prices from:
Amazon.com - US dollars
Amazon.ca - Cdn dollars
Amazon.co.uk - UK pounds
Amazon.de - Euros
Amazon.fr - Euros



HRM Guide makes minimal use of cookies, including some placed to facilitate features such as Google Search. By continuing to use the site you are agreeing to the use of cookies. Learn more here

Contact
HR Directory
Privacy Policy

Anything But Work
British Isles
Psychology Articles
Job Skills
Copyright © 1997-2022 Alan Price and HRM Guide contributors. All rights reserved.