Decision making is a big part of leadership. As a leader, one is expected to take decisions all the time. Some of these are of a routine nature, while others have the power to change the course of a business.
A lot rides on a leader’s decisions. They can impact the livelihood of the staff, the experience of the customers, and the future of the company. A leader’s own credibility and career could be at stake, too.
More often than not, decision making is tricky business. “I always make the right decision,” said no one ever.
No matter the level of your competence, the degree of your success, or the earnestness of your efforts, you must have a few spectacular fails in your resume. No need to be ashamed of them but they can surely teach you a lot.
We are blessed to be living in an era where there is tremendous help to aid our decisions. With the help of the right technology, the right techniques, and the right approach, leaders can take much of the guesswork out of decision making.
Use methods that help bring critical information together
A leader may make the final call but often a number of people are involved in business decisions. While their input ought to be considered, it can get messy with numerous factors and points of views weighing in.
This process can be streamlined with the help of appropriate methods that help with decision making. SWOT analysis, cost-benefit analysis, Pareto analysis, and decision matrix are some of the many tools available to decision makers.
Analytics are a God-send. Depending on how you interpret the numbers, you can glean invaluable information from data that informs practical decision making.
When vital information is laid out in the open, along with the possible outcomes of each decision, it becomes much easier to choose a profitable course of action that most (if not everyone) agree with.
Implement processes that aid sound decision making
While decision-making is a time-consuming process, not making timely decisions can prove to be a costly affair. But you also do not want to waste an inordinate amount of time and other resources on a decision.
To move ahead organically, lay the groundwork that enables pertinent information to rise to the surface and take incremental decisions. These will add up to make a considerable difference.
Create processes that allow better communication among team leaders and managers. This will save pointless back-and-forth as well as bring to fore problems that need to be addressed.
Regardless of the size of the business, invest in team communication/collaboration tools such as Slack, Asana, Trello, or ClickUp. There’s a tool to suit every budget. This will enable various departments to work together and lead to problems being addressed. Or at least flagged as they arise.
It’s important to encourage an open environment in the company so that even junior staffers can speak their mind. It is often people working first-hand on a project, and not their managers, who best understand the challenges involved. Their input may prove invaluable, and timely, accurate information is indispensable to making the right decisions.
Take a customer-centric approach
When faced with big business decisions, such as launching a new product or service, monetizing free services, or cutting back on features of popular services, always focus on the resultant experience of the end customer.
Are you going to make that experience better or worse?
The aim of a business is to make profit. But it cannot do so if it alienates the existing customer base in the process. Often that which is in the best interests of the customers is also the best course of action for a business. Use surveys, focus groups, and social media feedback to gather customer intelligence to guide decision making.
If likely-to-be unpopular measures must be taken, introduce them at a gradual pace and after adequate research.
Get familiar with industry dynamics and market trends
As a leader you are expected to be an expert on your industry. An in-depth knowledge of your field and intelligence on your competitors will give you priceless insights.
While market research is important, the ability to understand the larger picture and tease out the undercurrents in the market gives a leader additional competitive advantage and may lead to prescient decisions.
Gut decisions: trust but verify?
And now we come to the perennial question: Gut over evidence?
Short answer, no. Long answer follows.
Of course Steve Jobs famously said, “You can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something — your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.”
But Jobs was extraordinary. There are so many variables involved in decision making that one cannot rely on tools and techniques alone. Your gut feeling may be the biggest component of it all. Many business leaders swear by their instincts.
But I should caution that listening to the gut is an art that not everyone has mastered. A decision taken on the basis of gut feelings alone can backfire. To do an important gut-check, do these things:
- Pay heed to the doubts as they arise and address them.
If your instincts are at odds with the evidence, inspect why that is. Often this variance comes down to the kind of information one is relying upon.
Back up your gut call with considerable evidence, when at all possible.
You are, after all, answerable to stockholders, co-founders, and employees.
Everyone has their own style of decision making, just as they have a unique style of leading and managing people. This style is intricately tied with who they are as a person. It’s what has worked for them over the years. Self- awareness, therefore, is an often-overlooked part of the process.
Combine self-awareness with a keen awareness of the world, particularly your niche, excellent tools, and a willing workforce, and there you have it. You have all the components needed to make the right decisions time after time.