5 Tips on Decision Making

Decisions, Decisions.....

Decisions, Decisions.....

We make decisions everyday in our lives. Some people are seemingly wired to be laser sharp decisive, on the other end of the spectrum, some people find it stressful to make even the simplest of decisions like what to wear or what to have for lunch.

I read somewhere years ago in one of those self-help management books that to be decisive you need to work on your decision making muscles (light bulb moment!). In my own words and experience, the more decisions you make, the more confident you are of your decision making ability and trusting your instinct to make correct decisions. I believe in that.

In business, people rely on me to make decisions, daily. Its what I am paid to do. Some that will result in win-win, win-lose, lose-win or lose-lose outcomes, some easy without a blink of an eye, some complicated which requires some strategy and thought, some associated with high risk but on the flip side with potential high returns, some are just down right hard and tough calls to make. The thing is, I don’t shriek away from making them.

In good times, I made decisions to buy businesses, opened new offices in new markets, hired people quickly, invested substantial amounts of money in infrastructure, promoted people for bigger responsibilities. In tough economic times, I made unpleasant decisions to shut down offices, made some of my staff and colleagues (whom I have worked with for years) redundant, fired non-performers, cut staffs’ salary for the survival of the business.

Of course, not all decisions I made achieved stellar outcomes (I wish I had that foresight). You just don’t know how things will pan out but a decision needs to be taken so we can all take the next steps. The secret to success is to make more good decisions than bad decisions. Then you are ahead, in my book!

Here are 5 tips to help you on making decisions:

1) Simplicity and Clarity – I know that in most cases there are a lot of moving parts and different agendas to consider but I always try to break it down to the core essentials of why we are making the decision, the other stuff is just background noise to cloud the main issue(s). Being a visual person, sometimes I write it down on paper to see what it looks like all rolled out in front of me. Before making some complex decisions, I tell the other party that I will sleep on it and give an answer the next day, some thinking time is wise! For the really hard, tough, critical decisions, I usually go for a walk to go thru the different senarios and issues in my head, by the end of my walk with the benefit of fresh air and the exercise, my head is crystal clear (or have a plan, at least). My longest “decision making” walk was 2.5 hours.

2) Honesty, Respect, Fairness – Its bloody tough to be a business leader sometimes, you have company sales and profit goals to achieve. You have some staff for different reasons are not performing to expectation after all you have done. You have to make hard decisions. You cannot please everybody all the time, so always make the “right” decision by your people. The right decision doesn’t mean soft decision. Be honest, respectful and fair. Hence, I sleep well at night no matter how heavy the burden of the decision. People that I have made redundant or dismissed over the years, some of them are still good friends and I catch up with socially. Of course, there are some that would run me over if they see me crossing the road.

3) Stand By Your Decisions But Have Contingency Plans – once the decision is made, stand firm, you have to be fully committed to it. However, the seemingly best decisions can sometimes be blindsided by new developments. I like to think it thru all known senarios so that I have a Plan B in my back pocket. (See my previous blog post on “The Practical Optimist”, the bit on General Colin Powell). If you do have to change your decision, do ever so reluctantly and with good reason.

4) Done Better Than Perfect – Mark Zuckerberg recently wrote a note to potential investors addressing facebook’s impending IPO. He talked about the Hacker’s Way http://www.wired.com/epicenter/2012/02/zuck-letter/. One bit that stood out for me was “done is better than perfect”. It’s the sense of urgency to get things done. Make the decision, set the wheels of action going, tweak it long the way to get it perfect. Don’t suffer paralysis by analysis and delay making the critical decisions. That said, for some non-critical minor decisions, I sometimes purposely delay making them and you know what? They sort themselves out.

5) Indecision Kills – 2 examples here.

Example 1: The European Debt Crisis. Believe or not, the tragic Greek drama is going into its 3rd year and as a result, the entire European economy and hence the global economy had been dangerously walking the tight rope for the last 2 years in danger of falling into a potential global depression much worse than 2009. Some have liken it to the longest funeral ever. Sure, I understand it is a very complex matter but from reading the press, it’s the indecisions by the European Unions members and the leaders of the troubled debt countries that are delaying or not making the hard decisions to push thru austerity measures on their people. Solution here is straight forward really, you cannot live the lifestyle you cannot afford, wake up smell the coffee (Greek, Italian, Spanish, Portugese or Irish, you pick :)), no more la dolce vita (the sweet life) and get back to work to earn your keep!

Example 2: I bought Yahoo! Shares when the last CEO Carol Bartz was ousted (not one to go quietly, she famously claimed in the media that she was f**ked over by the Yahoo! Board). News swirled in the market that the Yahoo!’s Board is considering a full scale sale of Yahoo! to Alibaba/Softbank/US Equity Funds. Then the plan changed and they considered a partial sale of their assets. Then the plan changed again and they appointed a new CEO, Scott Thompson from Ebay to save the very profitable but declining business. Then the founder and Chairman, Jerry Yang and half the Board of Directors resigned. Because of poor decisions, lack of clear direction, the share price is in limbo but what’s worse, the talented staff at Yahoo! that can turn the company’s fortunes around are all heading out the back door to facebook and Google.

The above principles to decision making are also applicable to personal life too.

I am always keen to learn how you do it, care to share you tips and tricks to your decision making process?

Image of Decision dice from Google Images

Advertisements