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Decision Making in Business

Decision Making can be one of the hardest things we do in an organization, however it really shouldn’t be. Truly great leaders know they are going to have to make difficult decisions everyday and they know they’ll make mistakes along the way. Additionally, they’re the first to step up and admit they were wrong. I have seen this working in a number of different organizations throughout my career. One of the keys to great decision making is hiring the right people to work for your organization. Done correctly and you will not only have the most talented people

working for your company, you will also have the best executives who look at the big picture, think outside the box, and have the best ideas. Any company founder or CEO wants to have employees working for him who he knows are specialists in their field and can do the job better than him or most others in the industry.

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Decision Making as a Leader or as a Group

As a leader you should make the best decisions possible, especially when your team comes to you and asks for your advice or a final decision. When this does happen, I think it says something about the leader (that the team is coming to them for a final decision). I’ve only seen this in companies where the employees trust and respect the Manager, Director, Vice President, or CEO. On some of the easier decisions you should probably go with your gut, but if it’s an important decision I would suggest the following:

Weigh the Pros and Cons
There are always a number of alternatives to look at. Weigh the pros and cons of going one direction vs. another direction
Look at Past Experiences, Data, Facts, etc.
This data should help steer you in the right direction. If there are a number of directions you can go, try to find the optimal solution by looking at the pros and cons as mentioned above.
Experiment with Outcomes
Look at the number of different outcomes that could occur as a result of the two best decisions. What’s the best that could happen in each situation? What’s the worst that could happen in each situation?
Make the Decision!
After you examined the above three points make the decision and get moving on it!

I would suggest using the points highlighted above whether you are making a decision as a group or as a leader. There is something to be said about making decisions as a group. You should always involve your team in the company decision making process. Don’t leave out important executives because you’re limiting yourself and your company. I would suggest asking each team member what his/her thoughts are on the decision to be made. If you’re the leader and you have a majority of your team members moving in a different direction than yourself, go with the majority. There have been many instances in companies where the team is passionate about going in one direction while the leader was not and the team turned out to be right. For example, there is a great story about this with 37 signals and the decision to keep a lot of pictures and widgets on their homepage which was their employees decision, Jason Fried was against it. It turned out to be a huge hit.

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Empowerment

One of the most important things you can do for your organization is empower your employees to make some of their own decisions. If you’ve hired the right people, this should be a no-brainer. The more you empower your employees to make decisions and do what’s best for the company, the better they will perform. They will go from liking their job to loving their job and they’ll work harder as well. If you recognize this as a leader, your job will become much, much easier.

As a leader, there are always important strategic company decisions you’ll want to be involved in. It’s always your decision to make the decision yourself or seek help from your company. As a leader you should know what’s the best course of action to take. I have found in the past sometimes the best path to take in management is less of a hands-on approach and more empowerment, team work, and motivation of others.

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