Digital natives demand new decision making paradigm

12 May 2016. In order to keep their best employees, companies must involve them more closely than before in the decision-making process and delegate more decisions. This was revealed by the study “Global Perspectives Barometer 2016: Voices of the Leaders of Tomorrow.” In conducting the study, the GfK Verein and the St. Gallen Symposium surveyed around 800 future leaders from more than 70 countries.

Digital transformation changes the world of work

The digital transformation poses new challenges to companies. The leaders of tomorrow have grown up as “digital natives.” They are used to the increasing complexity and dynamism of digitalization. They demand that the current generation of leaders radically rethink their decision-making behavior and consciously resolve to change how they make decisions. In order to do so, they must overcome past experience and “best practices” from the pre-digital world. These were the findings of the study “Global Perspectives Barometer 2016,” for which the GfK Verein and the St. Gallen Symposium surveyed around 800 academics and young professionals from the generation of “digital natives.” Three key theses can be derived regarding how future managers envision decision-making processes.

Thesis 1: Urgent decisions that are being neglected pose the greatest risks. Mistakes primarily arise in the preparation phase for decisions.

More than two-thirds (68 percent) of the surveyed leaders of tomorrow believe that decision failures of today’s managers typically happen in the initial stages of decision-making. For example, 39 percent say that today’s managers are unable to identify all possible solution paths or to analyze and weigh various options adequately. They rely too much on past experience instead of radically questioning their assumptions in order to arrive at better decisions. “One of the largest problems in the view of future managers is that companies are blind to innovation and cling too much to what has worked in the past,” says Dr. Andreas Neus, Deputy Managing Director of GfK Verein. “This should provide food for thought for today’s managers. After all, the future of every organization depends on making sensible and timely decisions in rapidly changing markets.”

Thesis 2: Managers make the wrong decisions when they are operating in their “comfort zone” and do not actively invite their team to challenge their ideas.

Half of the respondents regard it as essential for managers to insist that especially young employees question their ideas during the decision-making process. Challenges should be actively invited. “Managers should examine their own ideas critically and not be alarmed if their own proposal is discarded in favor of another solution,” says Dr. Fabian Buder, project manager and author of the study.

Thesis 3: Involve your employees in decisions – or the best ones will leave.

A successful company needs committed employees. However, a quarter of the surveyed Leaders of Tomorrow indicate that they would rather switch jobs than work for someone who does not consult them when making decisions or overrules their ideas and objections. The preparation of a decision is crucial – this is where the serious errors are most common. Here the Leaders of Tomorrow all agree: Up to 90 percent of future managers want their team to take over major parts of the preparation.

Objectives instead of hierarchy

The “Global Perspectives Barometer” shows: Digital natives demand that companies fundamentally change the way in which they make decisions. As to the question of “how,” the Leaders of Tomorrow provide specific suggestions: They want to work in an information-driven and decentralized organization, which is managed by setting clearly defined objectives instead of hierarchically.

For 62 percent, this means a shift in decision-making authority: They demand that decisions are made by those who have the closest contact with the market and customers. Free access to internal information by all employees of an organization is the foundation basis for the long-term success of companies, according to 79 percent of the Leaders of Tomorrow. “Therefore, many companies faced with increasingly digitalized and fast-paced markets will have to ask themselves what they would rather do without: traditional information and decision privileges of the established management hierarchy or the ideas and creativity of the top talent among the digital natives,” states Dr. Johannes Berchtold, COO of the St. Gallen Symposium.

Picture: Photocase / kammerfranz