1) Loudest voice wins
2) Strongest influencer takes it
3) Most persistent finally overcomes
4) Biggest whiner gets it by default
5) Leave it to chance
And then there is the infamous decision-making process(DMP): “My boss already made the decision for me. I’m just going through the steps to say we had input from the team.” This type of DMP leads to poor outcomes. How often does this infamous DMP occur? It depends on many factors, from the type of company, the size, its' culture, to the amount of time to decide. On top of the infamous decision-making process, there is also the leader’s lack of emotional intelligence (EI). Unless we’re diagnosed as unable to feel, emotions play a role in our DMP. And if the leader does have a strong EI, the leader may then lack the ability to quantify the emotions to help with the DMP. As a result, this inability yields poor outcomes.
1) Ensure to incorporate all stakeholders
2) Consider the company’s ecosystem
3) Validate and verify the requirements
4) Include one’s emotions
5) Quantify and qualify the results
To avoid bad decisions, use a repeatable, reliable, and consistent process. You can use it for all your difficult decisions and get better outcomes. Also, ensure that the process considers the emotions of your team and you. Focus the emotions on the requirements, and not on the individual team members. That is, not how one person may feel about another in the team. Instead, base the emotions on items such as the vendor, salesperson, or user experience (UX). This is because being able to quantify one’s emotions is a way to show empathy. Some may find this feeling hard to convey. But, If you can quantify empathy, the team will feel better. It shows them that their emotions were part of the decision-making process. In the end, you’ll have better outcomes overall.
The decisions we make in business can affect the company’s outcome for a long time. If some not-so-good decisions are made, chances are the company will experience higher costs either through paying more for a service, facility, land, acquisition, and such. For instance:
There is also the cost associated with time, where management takes much longer than needed to make a decision, or does not make a decision until far later such that the costs of goods and service have escalated. For example:
Set aside costs for a moment, and consider the company’s trust, reputation, reliability, and service. These accolades are predicated by many things, including making good decisions. If we make poor ones, those tributes could be offset by skepticism, discredit, failures, and turmoil. Instead of being famous, the company becomes infamous.
So, if we don’t understand the decision-making process, and how to make more effective decisions and be efficient at the same time, we can be assured that costs will not be the only thing that negatively affects us.
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Are you being too cautious? Are you avoiding risks? If you spend too much time being “prudent”, adjusting at every turn to make your decision more “it’s not my fault” in the event something does goes wrong, then you might forego some opportunities. It’s important to manage your risk, but not to the point where you miss out on advancing your company. You need to be pragmatic and balanced between being too cautious and it’s okay to “come out to play-a-ay.” That is, it’s okay to take strategic risks.
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† Paluch, Dov. “Overconfidence bias in decision-making at different levels of management.” PhD diss., University of Pretoria, 2011, p. 2.
‡ De Smet, Aaron, Gregor Jost, and Leigh Weiss. "Three Keys to Faster, Better Decisions." McKinsey & Company. Last modified May 1, 2019. https://www.mckinsey.com/business-functions/organization/our-insights/three-keys-to-faster-better-decisions.