Decision Phobia and How to Fix It
4 minute read
Last week I was a guest on a podcast hosted by Caroline McAuliffe, Senior Partner at Watermark Search. We were talking about how to shift a culture from waiting for problems to be assigned, to showing initiative to hunt for the right problems and solve them. It’s the foundation of a highly adaptive and innovative organisation and the focus of my book Problem Hunter.
One of the participants in the chat asked this question (edited slightly for confidentiality):
“I’ve just done 27 months as a full-time contractor in a complex organisation after 20 years as an international expat. I get that it’s political and budget-driven, but I’ve found it’s difficult to get full-time staff to make decisions. How do you get them to solve problems, or even go looking for ones to solve, when they can’t even make decisions?”
Here’s the thing, the challenge isn’t laziness, nor lack of ability. It’s a predictable response to fear, complexity, and established cultural norms.
The solution isn’t telling people to “be braver and make decisions.” It’s creating conditions and the structures that make decision-making easier, safer and expected.
Why Smart People Stop Deciding
You’ve probably seen it before. A meeting opens with energy, ideas flying, everyone agreeing that something needs to be done. Then the conversation slows. Someone says, “Let’s circle back.” Another suggests, “Maybe we should get a consultant to look at it.” And just like that, the moment passes. No decision. No movement. Just another loop of “we should.”
This isn’t rare. A 2024 global study by HSBC found over half of business leaders feel ill-equipped to make confident decisions in uncertain environments, leading to widespread decision paralysis. McKinsey research shows that slow, inefficient, or over-complicated decision processes are a major drag on organisational performance. Organisations that make faster, higher-quality decisions consistently outperform peers on revenue growth, innovation, and agility.
It isn’t just a performance problem, it’s a cultural problem. Systems that punish mistakes more than they reward initiative train people to avoid being the decider. Add low psychological safety into the mix and talented teams stop experimenting, learning, and being decisive.
The Root Causes of Decision Phobia
1. Fear Outweighs Reward.
When the cost of a mistake feels heavier than the upside of taking action, doing nothing becomes safer. Studies on “blame avoidance” in organisations show that overly punitive accountability structures directly encourage delay, delegation, and inaction. If people are more afraid of being wrong, they focus on how to avoid exposing themselves to this potential. We are wired to fear loss twice as much as we value equivalent gain, psychologist Daniel Kahneman’s research found.
2. Low Psychological Safety.
Making a decision means saying, “Here’s my call,” and being okay with being wrong. Harvard’s Amy Edmondson shows that teams with higher psychological safety speak up more, experiment faster, and learn more. Without it, people stay silent and choose to avoid being seen, even when they know the right decision to make.
3. Too Many Options.
Choice overload is a major factor contributing to Decision Phobia. When faced with too many choices, unknown risks, or unclear outcomes, our brains default to inaction. Behavioural economists call this the “paradox of choice.” Complexity overwhelms action.
4. Outsourcing Feels Safer.
Hiring a consultant or deferring to a contractor creates plausible deniability. If it goes wrong, it’s not your fault. That illusion of safety is seductive, even when it slows progress and costs more. When responsibility is regularly outsourced, people stop thinking for themselves which erodes confidence in their decision making ability. What you don’t use you lose.
5. Complexity Hides Accountability.
Big organisations rely on rules and processes to function at scale. But too many rules, unclear roles, or conflicting procedures create playgrounds where people can hide from responsibility. Sometimes for years. It trains people to play hide-and-seek instead of knowing when to take the ball and run with it. If no one knows who decides what, nobody moves.
How to Cure Decision Phobia
1. Make Decision Rights Obvious.
Half the paralysis comes from uncertainty about ownership. Make it clear. Name the decider for key activities. “Position A decides X. Position B decides Y.” Delegations of Authority are good documents for this, but they need to be simple and accessible to work effectively. Clear boundaries empower staff to take ownership and make decisions.
2. Track Bottlenecks.
Indecision creates bottlenecks. Track key decisions for each key process and monitor how performance improves or slides. The NSW Department of Planning tracks Development Application Approval timeframes as part of its push to improve the flow of building activity. They’ve set a priority for 90% of housing approvals to be determined within 40 days. Identifying delays reveals where people need more support or clearer authority to act.
3. Simplify Deciding.
Use decision templates that have these four elements: context, options (no more than three), recommendation, next step. Less overwhelm, more action. Choice architecture research shows simpler, guided paths dramatically increase decisions made.
4. Promote Good Judgement.
Publicly back people who make reasoned, good-faith decisions even if outcomes aren’t ideal. When leaders defend good judgement, people stop playing not to lose and start playing to win. Punishing the exercise of good faith judgement drives indecision deeper into the culture of an organisation.
Try This
If you’re leading a team that struggles to make decisions:
Pick one recurring decision your team keeps deferring.
Write a short brief.
What we’re deciding
Who decides
What “good” looks like after two weeks
Decide. Review the outcome with curiosity, not blame.
One small act like this starts to transform a culture from fear to ownership, from avoidance to agency and sets the stage for people to start proactively identifying and solving the problems that drive innovation and progress.
Decision Phobia isn’t a character flaw. It’s a culture and leadership problem. If you want people to take initiative, pursue innovation, and strive for greater progress, it doesn’t work to just ask them to be braver. What works is to build an environment where bravery isn’t needed where making decisions is as natural as performing any other task.