Decision making is an action that a leader takes every day in running a business, but there are harder decisions to be made in the face of a problem or challenge.
According to an article in the Graziadio Business Review at Pepperdine University, “Great leaders understand how to balance emotion with reason and make decisions that positively impact themselves, their employees, their customers and stakeholders, and their organizations.”
[Related: What a Walmart Blunder Can Teach Us About Decision Making]
Decision-making process
If you want to develop your leadership skills, think about your decision-making process. The way in which you make decisions depends on many factors…your style, the complexity of the situation, and the size of your business (i.e., the help you can tap for decisions).
Some people go by their gut and do what feels right. Others agonize over each and every little decision. One business owner I knew suffered from “analysis paralysis,” where he could never get past just thinking to actually make a decision. His business limped along and never took off like he’d hoped.
The University of Massachusetts and Dartmouth have a 7-step process for effective decision making:
- Identify the decision
- Gather information
- Identify alternatives
- Weigh the evidence
- Choose among alternatives
- Take action
- Review your decision
Living with your decisions
One of the key issues about decision-making is second-guessing yourself. Once you’ve made a decision, you have to live with it. It’s just wrong to Monday morning quarterback a decision. Reviewing the situation and determining whether a different decision might have been better is a good strategy, because you can learn from a mistake. But recriminations are not productive.
Down the road, after reaching a decision that wasn’t productive, you can reassess the situation and make a new decision. In fact, you must continually monitor the results of your decisions.
[Related: 5 Tips for Delegating, When You’re Finally Done With Micromanagement]
Conclusion
President Truman knew his role in decision-making when he put a sign on his desk with the saying “The Buck Stops Here.”
An owner is the head of the company and is the ultimate decision-maker for the business.
Barbara Weltman is the founder of Big Ideas for Small Business, Inc., which publishes Idea of the Day. She is the author of J.K. Lasser’s Small Business Taxes 2019 and other books that inform the small business community of tax, financial, and legal information they should know about.
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