Jean Roberts

Why are Consultation and Consultative Processes important?

There are words used in Nonprofit organisations and SMEs that sometimes lose their original meaning and intent: or that can infer their original meaning and intent – but actually mean something quite different.  In this case, ‘different’ means less.

Consultation is one such word.  It is used frequently in the language of government, non-government, and in businesses and communities of any size and shape.  But more often than not, can be queried as to whether it is the right word for what actually happens.

One of the most helpful project management tools to be found is the Responsibility Matrix.  This is a matrix by which the acts of ‘consulting’, ‘informing’, ‘approving’ and ‘doing’ are clearly nominated or allocated against the parties involved in particular actions or activities of a project.  Here, ‘consulting’ is defined as ‘where the opinion of a party must be taken into account’, and ‘informing’ is defined as ‘where the opinion of a party does not have to be taken into account’.   Bear these clear definitions in mind as your read through this article.

Consultation and consultative processes are extensions of the verb ‘to consult’.  This verb, our dictionary tells us, has three specific meanings and applications:

1. to ask advice from someone,
2. to refer to something or someone for information, and/or
3. to have regard for and consider a person’s feelings and interests.

A consultation then is the act of consulting: the act of asking for advice, of referring to something or someone for information, and of having regard for and considering a person’s feelings and interests.

A process is defined as (a) a series of actions which produce a change or a development, and (b) the manner in which things are said and done, ie ‘how’ things happen.

A consultative process then is a series of actions that enable or facilitate the act of consulting, with the actions themselves contributing to the act of consulting.

As you read through these definitions, ask yourself if you have experienced genuine consultation when you have been involved in a labelled consultation or a consultative process, either as one who is invited to be involved or one who does the inviting.

Or has your experience been one of pseudo-consultation – ‘pseudo’ meaning false, pretence or misleading:

• effective consultation is a process whereby advice or information is sought, accepted as useful, and treated in such a way that shows respect for the source of the advice.
• efficient consultation is a process whereby the resources used in seeking the advice  or information are treated as an investment rather than a cost, and indeed prove to be an investment,
• humane consultation is a process whereby the person or people seeking the advice or information, and facilitating the consultative process, clearly have regard for and consideration of the feelings and interests of those whose advice or information is being sought.

Do not mistake information dissemination for consultation

Information dissemination is simply distributing an opinion or a set of facts to which no response is sought, and no advice or opinion is asked as to the use or usefulness of that information.  It is a one-way communication, in that the information is sent from one party to one or more parties with no response expected or requested on the matter.  Information is often disseminated in the form of a demand or command for action by the recipient.

In what situations is consultation useful?

Consultation can be effective in many situations, including:

• person to person
• team to team
• person to team – and vice versa
• association member to the Board – and vice versa
• sub-committee to the Board – and vice versa
• local government to community – and vice versa
• parliamentary representative to her/his constituents – and vice versa
• government department/s to members of the public – and vice versa
• decision-makers to community representatives – and vice versa

Note: The term ‘Board’ in this article denotes Board of Directors, and Committee or Board of Management – and Owner/Manager and Management Team within an SME.

Consultation is useful when the opinion or advice of one or more persons is sought as an input to effective, efficient and humane decision-making, which means the opinion or advice is sought for a purpose.

Consultative Committees are often established for the specific purpose of facilitating the process of seeking advice.  The evidence of an effective Consultative Committee is the extent to which the Consultative Committee (a) actively and openly seeks advice, and (b) takes that advice into consideration in its decision-making process.  Where a decision is made that does not reflect the advice sought, then an open declaration should accompany the declared decision as to the manner and extent to which the advice sought has – or has not – been integrated into the decision-making process that resulted in the declared decision.

If consultation is genuine, then both the advice received and the manner in which the advice is then treated will be open and transparent.  Genuine consultation is indeed useful.

Advisory Committees differ from Consultative Committees, in that Advisory Committees offer recommendations for action.  They may or may not have the opportunity to adopt a process of consultation in developing their recommendations, and this distinction shows the real difference between these two types of committees.

What’s the difference between the cost and value of consultation?

The cost of consultation should be assessed in terms of the actual dollar cost of facilitation, and this includes the dollar cost of:

• venue
• travel
• notices or briefing papers
• refreshments
• people’s time
• communication channels used for advertisements or invitations
• work left undone in order to participate, etc.

The value of consultation should be assessed in terms of benefit to those facilitating, attending and participating.  This can include:

• the quality of decisions that follow the consultation
• gaining commitment to a decision through participation in the process of making that decision
• improved and enhanced relationships between key parties
• an improved or enhanced basis for further initiatives
• increased trust and respect
• improved confidence and competence in the art and science of consulting and being consulted

What’s the consultative process for making decisions?

In this section, the focus is on the Board as the decision-maker – and hopefully, a consultative and participative decision-maker.  the Board can endorse a decision-making process and procedure to guide decision-making throughout the organisation, and ensure that all decisions are made in a consistent manner.

Equally, this process can be adopted by any party inviting others to be involved in a genuine consultative process.

A decision-making procedure is a series of sequential steps which ensure a consistent approach to decision-making, including:

• identification and diagnosis of a situation, difficulty or opportunity,
• reflective development of a plan to relieve or remove the difficulty, or to capitalise on the opportunity, and
• implementation of the plan’s success or otherwise.

The process of decision-making is the manner in which the procedure is followed to ensure a consistent quality of decisions.

Decision-making is one of the most important and repetitive functions of a Board.   As can be seen from the sequential steps, the procedure for making a decision clearly falls into five distinct critical success factors, which can be broken down further into seven distinct stages.

Critical Success Factors in decision-making:

1. a clearly stated style and process of decision-making
2. strategies and procedures in place to ensure consistency in decision-making
3. access to the decision-making process for all who have either an interest in, or could be affected by, the process or the outcome of a decision
4. a record of all major decisions, which must also be correctly recorded
5. decision-making processes and procedures that reflect the structure (ie delegation of authority and lines of accountability) and philosophy of the organisation

The 7-stage Consultative Decision-making Model

Stage 1                 Analyse the situation, difficulty or opportunity

Stage 2                 Define and agree upon the situation, difficulty or opportunity

Stage 3                 Examine alternatives for action

Stage 4                 Explore implications of each alternative

Stage 5                 Select the alternative to be acted upon

Stage 6                 Implement the selected action

Stage 7                 Review and evaluate the process and the decision

Stage 1:                Analyse the situation, difficulty or opportunity

This first stage can be quite a challenge in itself.  What may have been seen as the situation, the difficulty or the opportunity may prove, on closer examination, to be but a part rather than the whole.  The situation, difficulty or opportunity may be far more complex after examination and analysis than that which people thought they were dealing with at the outset.

Stage 2:               Define and agree upon the situation, difficulty or opportunity

After a thorough analysis, a definition should be written down and agreed to by the group involved in making the decision.   Everyone is then starting the decision-making process with a common definition of the situation, difficulty or opportunity.

It is a futile exercise when a group of people try to decide something that is not clear to any of them or which each is interpreting differently.  Only confusion will follow, with little positive action or accomplishment.

Stage 3:               Examine alternatives for action

If the situation, difficulty or opportunity is a complex one, it is important to consider a number of alternative actions.   At this stage, it is not necessary for suggested actions to be practical or even feasible.  This is the brain-storming stage where all manner of ideas or suggestions can be floated and teased out – without being constrained by practical details.  Many exciting and effective projects start out as wild ideas.

Stage 4:               Explore implications of each alternative

With a number of alternatives identified, each is now taken separately and considered seriously.  Implications for each alternative are examined against a set of criteria which could include:

1. how will the action affect stakeholders who may be involved or affected?
2. how much money, time and energy would be needed?
3. is the necessary skill and knowledge available?
4. is the action financially viable, and acceptable within financial objectives or priorities?
5. does the action fit with the organisation’s existing commitments, priorities, and strategic and policy framework?
6. has any other organisation had experience with this action and should we talk with them first?

A sheet of paper divided into two sections to list the positives and negatives of each alternative is a great help in examining facts.  Note that the focus is on fact at this stage.

Stage 5:               Select the alternative to be acted upon

Selecting one alternative as the preferred action is necessary now, and should be relatively easy after examining the implications of each alternative in Stage 4.

Stage 6:                 Implement the selected action

Implementation of the selected action is planned in detail by asking these questions:

1. exactly what is to be done?
2. what is the purpose and benefit of this action?
3. how is it to be done?
4. who is to be involved and where?
5. what is the time-schedule for the total action – starting from this day right through to completion of the action?
6. how will we know that each stage of the action is completed?

Implementation of the selected action or decision is now ready to proceed. The planning is about to become reality.

Stage 7:              Review and evaluate the process and the decision

Ask this question – how will we know when the total action is completed and that the planned purpose and benefit (ie outcome) have been achieved?   Reviewing (asking the question ‘did we do it?) and evaluating (asking the question ‘how well did we do it?) are vital components in the decision-making process.   In this review and evaluation stage, it is necessary to:

1. revise all the notes taken during the previous 6 stages
2. observe and ask questions of people involved
3. compare the real benefits and outcomes of the chosen action with the anticipated and unanticipated benefits and outcomes.

Remember to review and evaluate the process and procedure of making the decision, as well as the decision itself.

Involvement in decision-making, ie the consultative process

It is important to invite others to join in the process of decision-making at the appropriate stages.  Some suggestions for involvement:

a)                 people with expertise, knowledge, experience, and information concerning the situation, difficulty or opportunity

b)                 people with the right to be involved

c)                 people who will be directly affected by the process, the decision, and/ or the implementation of the decision

d)                 people who can lend some ‘muscle’ to the desired outcome by being involved in the process

e)                 people who will gain skills, expertise and experience, or will benefit from involvement in any way

f)                   people who have available time and energy.

There are different stages for different groups of people to be involved, eg

• those who will be closely affected and involved as a result of the decision should be involved in selecting the alternative for action (stages 4 and 5)
• those with available time and energy should certainly be involved in the time-consuming stages such as analysis (Stage 1) and detailing and costing the implications of each alternative (Stage 4).

Seven ‘key words’ to use in designing an implementation plan at Stage 6

What, why, how, when, where, who, and at what cost”

As explained, decision-making is one of the most important and repetitive functions of a Board. There are many occasions in Board decision-making that will benefit from this process – and from the structured inclusion of people with a stake or interest in the process or outcome.   The quality of decisions and decision-making will greatly improve.

Not every decision will need to be worked through to this degree of detail, as there will be many decisions made on the basis of:

• previous decisions, ie what has been done or not done previously,
• existing policies and procedures, or
• expectations or requirements imposed by external factors or authorities.

Decision-making styles

As well as taking care with the decision-making process and the quality of decisions, it is important to understand these two decision-making styles:

• collaborative decision-making, where the decision-makers consult with groups or representatives of those  who are going to be affected by major decisions
• participative decision-making,   where the decision-makers give such groups or their representatives an active role in actually making decisions

These two styles come together as:

• collaborative and participative decision-making, where people are not only consulted, but also play an active role in the process and procedure of deciding-making.

Collaborative and participative decision-making is the most preferred style for Nonprofits and SMEs in all matters where it is important that those who will be affected by or involved with either the process of decision-making or implementation of the final decision are able to contribute to the process.

The emphasis in this style is two-fold:

1. to consult widely before making the decision, and
2. to include people other than the decision-makers in the actual making of the decision.

Benefits of this preferred style include:

a)                 a wider contribution to the analysis of the situation, difficulty or opportunity

b)                 a wider contribution to the exploration of alternatives

c)                 greater knowledge and understanding of each other’s opinions, therefore increased tolerance, trust and respect

d)                 greater commitment to the decision once it is made – people understand the reasoning behind a decision when they are involved in the process of making the decision

e)                 greater chance of the decision being carried through to action

f)                   closer bonds between the different groups of people who together make up the Nonprofit or SME.

It must never be forgotten that the primary purpose of all decision-making is:

• to achieve increased benefits for primary stakeholders (ie those most likely to be affected by the decision itself)

     and

• to achieve agreed objectives with and through people.

Checklist for effective and efficient decisions

1.             What is a decision?

• the selection, or process of selection, of a course of action from a range of possible alternatives
• a judgment, conclusion or resolution reached or given

 2.             What does a decision look like?

• decisions are a common factor in people’s lives, regardless of position or possessions
• decisions come in seven distinct flavours:
  • routine
  • non-routine
  • contentious
  • non-contentious
  • urgent
  • important
  • unnecessary

3.             How to assess the value of a decision?

• decisions should faithfully reflect the legal, strategic, financial and policy framework
• always examine the organisational implications of each financial decision and the financial implications of each organisational decision
• always consider the point of service delivery when making decisions:
  • is this decision going to improve the delivery of services?
  • can the service-user receive increased value as a result of this decision?
  • are we risking the satisfaction or value to a service-user by making this decision?
  • can we avoid or better manage an existing risk to the satisfaction or value to a service-user by making this decision?

4.           When each decision is made, record the decision, and immediately initiate an action plan:

• what is the action
• who does what
• when is the action to be completed
• at what cost
• how and by whom is the action to be reported or monitored

 Email  jean@jeanroberts.com.au  for your free copy of Jean’s 2004 book/CD ROM, Managing Governance in Nonprofit Organisations in Australia, (Jean Roberts, 2004)

- this article is Unit 11: Consultation and Decision Making on the CD.