Decision Making 101

Every day we make decisions. Some are simple – paper or plastic, cash or credit, baked potato or fries. In our work lives, our decisions can impact lives, careers and the bottom line. Good decision makers are critical for corporate success. However, making sound decisions is far from easy. We are not machines; we are humans with egos, feelings and emotions that get in the way of objective decision making. While we’ll never make decisions with Spock-like discipline, here are some guidelines for making sound decisions in an organizational setting.

1. Don’t be afraid of change. Nothing irks me more than hearing “This is how we’ve always done it.” If that’s the best reason you can come up with for doing something a certain way, it’s time to rethink your approach and try something new. Technology changes, attitudes change, nothing about our culture stays the same, and if you don’t adapt to change, you will fall far behind your competitors.
   
   
2. Don’t look backwards. I want to scream when I hear “But we already invested so much in this…” As they say on TV, “Past performance is not an indicator of future results.” Each and every decision should be made with your eyes looking forward, never backwards. If you have multiple options to pursue, evaluate each option based on its probability of success, resources needed, and financial cost/benefit starting from today. What you did in the past is a “sunk cost”. It shouldn’t affect your thought process (I know…easier said than done). If you include past decisions in your current analysis, you risk “throwing good money after bad”. Better to cut your losses than to continue investing in an option that won’t yield the results you need.
   
   
3. Analyze impacts to multiple stakeholders and… Many decisions result in unintended consequences. These can be minor issues or major deal breakers. Before picking Path A over Path B, be sure you’ve thought about how your decision will affect anyone involved. Some of the impacts may be negative, but if you’ve analyzed it and defined the ramification, you can plan ahead and turn a Win-Win-Lose, into a Win-Win- Not So Bad.
   
   
4.  …Include diversity. It takes a wide range of perspectives to understand the benefits and ramifications of a critical business decision. Make sure you confer with a group of people, preferably with different backgrounds than you, to get the full picture before going down a path. You don’t want a group of Mini-Me’s who will always agree with you. You want people to challenge you and complement your skills. You don’t know all the answers (really…you don’t!) Trusted advisors can make the difference.

Alright…you’ve done it all. You’re ready to change things up. You’re not looking backwards. You gathered your diverse group of trusted advisors and analyzed your options. You’re ready to pull the trigger. Are you done? No way. The final step is…

Communicate, communicate, communicate. Implementing a new program or instituting change of any sort can only be successful if you communicate often and effectively. Make sure people affected by your decision know What, When, Where, Why and How. Don’t assume that people know why or understand the changes. Better to over communicate than to leave people at best confused or at worst angry, cynical, and disengaged.

As leaders, we have the responsibility to make sound decisions that can advance our organizations toward reaching their strategic goals. Following these steps will keep you on the path to successful decision making.

What do you think? Is this how decision making is done where you work?