Coffee or tea? Drive or walk? Donut or bagel? We make thousands of decisions a day, dozens before we even start work. Many are easy, some require a little extra thought or research, but a few are not only complicated but super important. Your decisions in these cases can impact your team, your boss, and perhaps even the future of the business itself. So where do you begin?
The trick to making a good decision is thinking things through piece by piece. By breaking your decision process down into distinct stages, you gain two benefits: Firstly, creating separate stages makes each part less intimidating and easier to evaluate. Secondly, it forces you to document your thinking at each stage. Recording this process also means that when the decision is done, you will have data which you can then review and use for improvement the next time around.
And if things do go wrong and your decision turns out to be the wrong one, at least you can present your thinking back to your team and any stakeholders, explaining where you went wrong and why. This has the added bonus of showing you’ve conducted your due diligence.
How to make better business decisions
At its core, any decision-making process should help you, first, identify your choices, and, second, work out the best solution. There are many ways to set up your process, but the most commonly-accepted number of stages is seven. So without further ado, here’s how to optimize your decision-making process in seven simple steps.
Step 1: Identify the decision
Before you do anything, you need to work out exactly what it is you’re trying to solve.
- Why do you need to make a decision in the first place? What changed either within or outside of the organization?
- Is there a timeline by which a decision needs to be reached?
- Can anyone help you make this decision, and should they be involved early on?
- Who will be affected?
It’s easy to get distracted by the symptoms or goals instead of the root issue, so make sure you have a firm grasp of the decision itself and stay as focused as possible.
Step 2: Gather your information
Next, you need to gather together the facts and data that will help you make this decision. Decide which sources of information are worth pursuing, then set out your methods for sourcing this data.
This should include internal assessments and conversations with your colleagues, but it could also include external information from books, online, market research, surveys, focus groups, etc.
Step 3: Identify your alternatives
Now you need to set out each possible solution, without choosing one. As you were collecting information (back in stage two), you probably started envisioning these possibilities already. Represent each solution fairly, regardless if you’re already forming your own preferences.
Don’t worry if you initially feel like there are too many options to choose from. The more options you fully work through, the better your ultimate decision will be.
Step 4: Analyze your evidence
Now the tricky part: weighing your options. Keep the definition you came up with in Step 1 close by, so you can be sure you’re choosing a solution that best suits the original problem or opportunity.
For each possible solution, identify the roadblocks and routes that offer a higher chance of you reaching your goal, and finally, rank your different routes according to preference.
You may want to bring in information about your company’s past efforts to see if you can use lessons from previous successes and failures to predict your own probability of success. You can also look at how other businesses have approached this same decision.
Tip: Using a diagramming tool — such as Cacoo — to visually represent your decision-making process can help you organize your thoughts more easily. And you can even use it as a way to collaborate with your team or boss along the way.
Step 5: Choose your path
With a little gut instinct and a lot of data-driven data, you’re ready to take the plunge and select your path — or combination of paths. If you’re still unsure, don’t be afraid to run things past a colleague or the wider team. Collaboration early on means everyone will feel more engaged and invested in your decision as the project gathers speed.
Tip: It’s well worth selecting a second backup option, just in case your first one falls through.
Step 6. Prepare your action plan
Before you jump in, set expectations for everyone involved. Create a plan of action, which includes getting the support of your employees, your boss, and your stakeholders (which may involve creating a killer project proposal) as well as identifying and reserving the resources you’ll need.
Don’t forget to have the facts and figures you gathered in Stage 4 ready, so you can address any concerns that may arise.
Step 7: Measure your success
To know if you’ve succeeded, you’ll need to measure it. After your plan is in place, take an honest look at your results and see whether your decision fulfilled your initial goal. What worked? What didn’t? Can you take credit for something that worked? Or do you need to hold up your hand and admit you made a mistake? You may realize that your decision was the right one, but the plan was executed poorly, and that you need to retrace your steps and revisit an earlier stage.
Once you’ve answered these questions, you’ll be in a better position to optimize this decision and improve your decision-making process the next time around.
There’s no denying it: decision-making is difficult, not to mention scary — but with a documented decision-making process in place, you’re much more likely to make logical decisions that everyone can understand and learn from.
You can document it in whatever way works for you, whether it’s a good old fashioned note pad or a collaborative diagramming application. Just be sure you have something to look back on to help you identify mistakes, learn about your strengths, and justify your decisions to others later.
Through repetition, you’ll begin to refine your process and start to make decisions faster, with greater accuracy, and with more confidence.