Needless to say, life is full of decisions. However, when they involve your business, the stakes could be pretty high. The choices you make today can impact cash flow, resources, employees, and partnerships and determine your company’s future growth and success.
Given what is at risk, it is natural to feel intense pressure when making business decisions. Textbook answers rarely work when you are tackling challenges in the real world, and life hardly ever presents the perfect solutions for you to choose. There are always risks, lost opportunities, and limitations you must consider. All these can lead to poor choices and decision stress, which, alarmingly, 85% of business executives experience.
So, how can you make an optimal decision and select the best course of action for your organization? Here is what we recommend.
Put Things in Perspective
Getting a 360-degree perspective of the situation will help you assess it more effectively, putting you in a better position to make a prudent decision.
- Keep emotions aside
In high-pressure situations, it is easy to miss little details and make poor judgments. This is why leaving aside emotions is essential before you evaluate your options. If you feel particularly anxious, use deep breathing and similar techniques to calm your nerves.
- Determine your goals
Take stock of the challenge you are trying to resolve and identify what exactly you would like to achieve. Also, establish how you will know once you have accomplished it.
- Weigh the pros and cons
Every option has its own opportunities, risks, benefits, and disadvantages. So, evaluate them carefully and list them down on a sheet of paper.
- Assess your limitations
Constraints in accessing budgets, staff, and other resources could prevent you from executing the selected decision. Therefore, examine what you would require to implement each course of action at the onset.
- Consider your core values
The option you choose should be aligned with your business’s values, principles, and codes of ethics.
- Evaluate your risk appetite
Given the circumstances, decide how much risk your company is prepared to take.
- Identify personal biases
Your personal preferences, opinions, and beliefs can influence the decision-making process without you realizing it. Avoid them to ensure you make the right choices for your business.
Gather Facts
Evidence-based decision-making is critical for steering clear of personal biases, unfound assumptions, and emotion-led choices. It also allows you to minimize errors and arrive at more reliable, accurate, and objective conclusions supported by facts.
Therefore, collect and document as much data as possible. It can include research reports, log books, surveys, studies, questionnaires, verified facts and figures, and other findings.
Think Ahead
Your business will not remain constant as time goes by. Requirements, circumstances, strategies, and people are bound to change in the next few years.
As a result, the choices you make today could impact your organization in an entirely different way in the future. So, ask yourself whether you will make the same decision ten years down the line and how it will affect your stakeholders. Take a long-term perspective to minimize any future adverse consequences.
Think Back
The past can hold clues to guide your assessment of evidence and solutions. For instance, by exploring similar events, you can learn from previous choices made by others. This is an excellent technique to gain practical insights and improve your decisions.
Of course, bear in mind that your situation could somewhat differ from historical ones. However, case studies, past data, and the like could prove extremely useful for understanding possible outcomes.
Consider Different Scenarios
Scenario planning is another essential technique that could guide you in choosing the best options available.
Remember, external and internal factors could change in the short- to medium-term, and some may not be within your control. For example, new competition could enter the market, the government may make policy changes that affect your industry, or climatic conditions could take a turn for the worse.
Identifying such potential business scenarios and how you could best prepare for them is vital when making optimal choices for your company.
Seek Different Perspectives
Colleagues, bosses, and experts can also add invaluable input through their experiences and domain expertise. So, speak to your coworkers and schedule a brainstorming session. Find and connect with industry professionals on LinkedIn to share ideas, or search for a consultant on Leadar to seek expert advice.
Having said that, opinions can also become a double-edged sword if you are not careful. Too many contrasting perspectives can hinder your decision-making process. Keep this in mind when soliciting advice and input from others.
Listen to Your Instinct
Contrary to popular belief, the best solutions are, sometimes, the least complex and obvious. If you allow your natural faculties to guide you, you might identify them faster.
However, many people are reluctant to let their gut influence their decisions. But in the book Blink: The Power of Thinking Without Thinking, Malcolm Gladwell, the author of five New York Times bestsellers, contends the benefits of intuitive decisions. Intuition, to a large extent, is also based on past experiences and learnings. Therefore, it can be incredibly helpful in determining effective action for tackling a particular situation.
Be True to Yourself
Being authentic is also critical when you are making business decisions.
Ultimately, you will likely not find the perfect formula. So, you must determine the optimal option given the circumstances. But you need to be true to yourself and ask whether you will make the same decision if it is your own business. If the answer is no, then re-look at your choices.
Don’t allow yourself to be held back by past mistakes and unpleasant experiences. Go out of your comfort zone and challenge the status quo.
To Conclude
Choosing the best course of action for your organization can be a stressful affair, especially when the stakes are high. But with the right approach, you can navigate the complexities of business decision-making and arrive at an effective solution.
Start by putting things in perspective and gathering factual evidence. Think ahead well into the future while you also learn from the past. Consider various scenarios and seek differing input and opinions, but also listen to your instinct and be true to yourself.
Once you make your selection and implement it, take time to review outcomes periodically. This will allow you to make timely corrections and gain practical insights and learnings.
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