7 tips for making quality business decisions

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Unfortunately, making a decision can be difficult. It’s impossible to predict whether the decision you’re about to make will produce amazing results or create a situation that requires damage control.

A McKinsey & Company study found that only 20% of respondents said their organizations excel at decision-making. Although a staggering statistic, there are effective ways entrepreneurs can improve the quality of their decision-making process.

1. Consider your state of mind

In today’s world, there is a lot of pressure to act quickly, and decision making is no exception. It is important to keep in mind that we are not always in our best mental or emotional shape to make decisions. If you feel excited, scared, or angry, you may make a rash decision that can have lasting negative consequences.

If you feel like your emotional state is off, take some time to clear your head. Deep breathing, exercise, and meditation are great activities to improve your overall state of mind and can best prepare you for the decision-making process.

Related: How to Restore Work/Life Balance

2. Carefully assess the situation and the data

The information we have in front of us doesn’t always tell the whole story. Making decisions based on incomplete information can lead you to make the wrong decision. Take time to carefully assess the entire situation. Be curious and ask lots of questions to make sure you have all the information you need to make a good decision.

Data can be your best friend and worst enemy when making decisions. Beware of information overload. One survey found that 44% of people find decision-making difficult due to the overwhelming amount of data. And you don’t want to make a decision based on quantitative data alone. There are other factors such as human emotion that are difficult to translate into data.

Related: How to use accurate data to make effective business decisions

3. Review the desired results

In his bestseller, The 7 Habits of Highly Effective People, Dr. Stephen Covey urges his readers to “begin with the end in mind.” Decision making becomes significantly easier when you know that your choices will take you one step closer to achieving your goals or strategic objectives. Before making any decisions, take a moment to review your personal goals or the company’s mission. If the decision reinforces your goals, that’s a good indication of what path to take.

Related: If you want a better result, take better action

4. Identify your blind spots

Blind spots are areas where you lack sufficient skills, knowledge, or experience that could negatively impact your decision-making. For example, the decision to merge with another company without a solid understanding of contract law can be a disaster. Ask a friend or business partner to help you identify your weaknesses or blind spots. Better yet, join a peer board with non-competing business owners. This will help you proceed more cautiously the next time you have to make a decision that involves one of your blind spots.

Connected: 10 Reasons Leading Entrepreneurs Should Join a Peer Advisory Board

5. Involve others in the decision-making process

Although entrepreneurs and business owners are solely responsible for the success or failure of their companies, they should not make decisions alone. In many cases, you can benefit from the support of other professionals (such as senior managers, human resources, lawyers, CPAs, etc.). Involving other people in the decision-making process can bring new perspectives that you may not have considered.

Connected: How to make better decisions

6. Just make up your mind

While it’s extremely important to make sure you’ve carefully considered all options before making a decision, inaction is often worse than making the wrong decision. You have to make a decision one way or the other.

A good strategy is to think about the worst thing that could happen. If the worst-case scenario is something you can live with, at least you’ll feel confident that you can fix the situation if it doesn’t turn out the way you’d hoped.

Related: 6 Ways to Make Tough Decisions Easier as a Leader

7. Communicate your decisions

Once a decision has been made, it is important to ensure that all affected people are informed of the direction you have chosen to go. How you communicate your decisions can affect how they are received. Some delivery methods are better than others. For simple solutions, an email or note will work well. However, difficult decisions that require detailed explanations may be better suited to a face-to-face meeting.

Related: 10 Steps to Quality CEO Decision Making

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