How to Improve Decision Making in Your Company

How to Improve Decision Making in Your Company

March 14th, 2011 // 3:36 pm @

good decisions

Whatever your company, regardless of the quality of your strategy and business plan, or the resources you have to invest, the success of your business will be driven simply by the quality of decisions made in it, both by the CEO and every person in the company.

Developing an environment in which every person is more likely to make good decisions should be a key senior managerial goal, and there are some basics to making it happen:

  • Business Strategy – develop and articulate the vision for the company regularly, it gives a context to all decisions. If people know where he company is trying to go, they are likely to make decisions that support that development, without it, they may make well meant but totally wrong decisions.
  • Empower the Right Person – Who makes a decision in an organization is critical to its success. The right person needs to have the authority, knowledge and responsibility. If these are separated as they too often are, effective decision-making is doomed. The most common issue is decisions are made too high in the company where authority is, but detailed knowledge rarely is. This reflects human nature, which tends to feel safer making decisions than delegating them. The truth is a well-delegated decision is almost always more successful.
  • Understand Important and Urgent – There is peculiarity in western culture, a tendency to link these two completely different concepts into one. It looks macho to make quick decisive decisions, but in doing so we rob ourselves of the time to think, and consult. He human brain takes time to process, the old adage “I want to sleep on that” reflects that given time we all normally make better decisions. I actively when I have an important decision give myself time to think, I consult, I draft, I redraft, and normally get to a balanced decision.
  • Courage – At the end of the day there are tough decisions that need made in companies, and senior managers need to make them. It often feels safe to carry on as before, not to change, but we live in a fast moving world, and while continuity can feel safe, it rarely actually is. Some years ago Antonio Perez the CEO of Kodak told shareholders that the business’ core business of film would die, and die quickly, and some hard decisions were required. His shareholder base exploded, and he was nearly unseated, because some shareholders did not want to face the decisions that came from his statement. He was of course correct, and he has successfully reinvented Kodak from a film company to a digital company.
  • Consult – Sadly some people see consulting as weak, I do not share that view. I have always asked people I work with when they bring me issues to tell me what they want from me. Do they want me to make the decision? Do they just want to tell me for information, or do they want to talk it through and they will make the decision. I always make time for all three, but particularly the last one. And consulting does not mean decisions become a majority vote, a good CEO can listen too all kinds of advice and have when they deem it correct the courage to ignore it.

Good decision making, and building an environment in which it can happen, is not something that happens by accident, it is a key part of the managerial process.


Category : Blog &Key Business Success Drivers

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