Business – Decisions, decisions

Few things in our life, and in our businesses, will affect us more than the quality of our decisions. 

We make decisions every day, some small and unimportant, some critical and life-changing. Yet very few of us have been formally, or even informally, trained in how to make better decisions. It is not my intention to train you all on how to be better at making decisions, more to ensure you understand some of the pitfalls and the reasons we all make poor decisions from time to time.  

There are many “models” of decision making – just Google it and you will find references to all sorts of diverse systems and processes that authors think we should be following. But good decision making is more basic than learning and trying to execute process, it’s more about understanding why we make bad decisions. 

The biggest reason for making poor decisions, be it in life or in business, is that we are unintentionally stupid. We all like to think we are rational and capable of interpreting information in a non-biased way, but unfortunately that’s not the case! We all have biases, and our life experience has moulded and shaped those into the decision-making machine we are today.  Knowledge of those biases before making a decision may help, but we are never far away from doing something dumb. If we are tired, overly focused on a goal, rushed, distracted, or under the influence of a group of dominant characters, we are even more likely to make the wrong move. So, when making an important decision, make sure all those environmental factors are in your favour. And give thought to your own biases, beliefs and assumptions.  

This is not easy work, but it is critical to improving decision making. Think back to bad decisions you have made in the past and reflect on why you made them. What biases pushed you towards stupidity?

In business, we need to accept that we will never have all the information we need to make the best decision. If we wait for all the information, it will likely be too late, so there will always be a level of assumption. If we have good information, our assumptions will be fewer but stronger, and as a result our decisions will be better. 

So be very critical of the information you do have – be critical of its source, explore it, question it, test it. 

If your business is facing challenges, if the current environment of uncertainty is causing you to consider making business-changing decisions, then the best advice is to involve others in any decision-making process. The more complex or critical the decision is, the more people should be involved. The more perspectives you can consider, the more information you have, the more questions you can ask, the better your decisions will be.