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How To Make Great Decisions

Written by: Mike Myatt

Article Overview: This article gives advice to executives and how to make outstanding decisions.

How To Make Great Decisions

Senior executives who rise to the C-suite do so largely based upon their ability to consistently make sound decisions. However while it may take years of solid decision making to reach the boardroom it often times only takes one bad decision to fall from the ivory tower. The reality is that in today’s competitive business world an executive is only as good as his/her last decision. In today’s post I’ll provide some tips for making consistently good decisions…

Nothing will test your metal as an executive or entrepreneur more than your ability to make decisions. I absolutely love to make decisions and whether it is in my operating role as Chief Strategy Officer for N2growth or my role as a husband and father, I want to be the one making the tough calls. That being said, nobody is immune to bad decisioning…We have all made bad decisions whether we like to admit it or not. Show me someone who hasn’t made a bad decision and I’ll show you someone who is either not being honest or someone who avoids decisioning at all costs.

For more than 20 years I have either served in the capacity of a principal owner or senior executive and have generally been highly regarded for my decision making ability. I have also made my fair share of regrettable decisions. When I reflect back upon the poor decisions I’ve made it’s not that I wasn’t capable of making the correct decision, but for whatever reason I failed to use sound decisioning methodology. Gut instincts can only take you so far in life and anyone who operates outside of a sound decisioning framework will eventually fall prey to an act of oversight, misinformation, misunderstanding, manipulation, impulsivity or some other negative influencing factor.

The complexity of the current business landscape combined with ever increasing expectations of performance and the speed at which decisions must be made are a potential recipe for disaster for today’s executive unless a defined methodology for decisioning is put into place. If you incorporate the following metrics into your decisioning framework you will minimize the chances of making a bad decision:

1. Perform a Situation Analysis: What is motivating the need for a decision? Who will the decision impact (both directly and indirectly)? What data, analytics, research or supporting information do you have to validate your decision?

2. Subject your Decision to Public Scrutiny: There are no private decisions…Sooner or later the details surrounding any decision will likely come out. If your decision were printed on the front page of the newspaper how would you feel? What would your family think of your decision? How would your shareholders and employees feel about your decision? Have you sought counsel and/or feedback before making your decision?

3. Conduct a Cost/Benefit Analysis: Do the potential benefits derived from the decision justify the expected costs? What if the costs exceed projections and the benefits fall short of projections?

4. Assess the Risk/Reward Ratio: What are all the possible rewards and when contrasted with all the potential risks are the odds in your favor or are they stacked against you?

5. Assess Whether it is the Right Thing To Do: Standing behind decisions that everyone supports doesn’t particularly require a lot of chutzpa. On the other hand, standing behind what one believes is the right decision in the face of tremendous controversy is the stuff great leaders are made of. My wife has always told me that “you can’t go wrong by going right” and as usual I find her advice to be spot on…Never compromise you value system or your character or your integrity.

Decisions can, and usually will, make or break an executive. Those that avoid making decisions solely for fear of making a bad decision will rarely rise above mid-management, and those that make decisions just for the sake of making a decision will likely not last long. If you develop the appropriate blend of a bias to action with an analytical approach to decisioning your stock as an executive will surely rise.

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