5 Steps For Improving Your Decision-Making Skills
In the workplace, the ability to make a good decision with the information available to you is vital. That’s true for all of us, but nobody more so than leaders, who are called upon to make high level decisions about strategy, people and budgets almost every day. Decision making can be overwhelming without a proper framework, which is why we recommend taking the following steps first.
Collect and evaluate data
As a leader, you have an overwhelming amount of information coming in all the time. That includes information you’ve been told about the situation, pre-existing knowledge and intuition. Sometimes those sources of data seem to be at odds; other times, they come together.
When you consider the forms of knowledge available to you, take a moment to examine their source. Is the push to upgrade your IT system coming from an objective analysis of its performance, or based on anecdotal evidence about the latest gadgets? When you’re considering someone for a promotion, are you looking at their performance metrics or being swayed by a personal connection or the opinion of others?
Be conscious of your own bias
What we call intuition, or ‘gut feel’, is often an umbrella term for various sources of knowledge including pre-existing beliefs, value structures and emotion. Some of that is valuable, allowing you to draw on pre-existing knowledge and pattern recognition. Some of it is not. It’s well established that when we already hold a belief, we readily retain information that supports that belief, and ‘skim over’ information that doesn’t.
Once you have all the available information, ask yourself whether some of what you ‘know’ is in fact what you believe, or what you want to be true. When we rely too much on intuition, bias can creep in, leading to a poor decision.
Perform a situational analysis
A situational analysis will enable you to understand the complexities of the decision, who could be affected by it and how. Consider the following questions:
- Why does a decision need to be made, and who stands to be affected by it?
- Do the costs of implementing the decision outweigh the proposed benefits, and what margin of error is there in the possible outcome?
- Are you prepared to back up the decision in the face of opposition, and do you have the data behind you?
Focus on the end game
At the end of the day, what do you want to achieve? It can be easy to give your attention to the intricacies of the situation at hand and lose sight of the larger context. A hiring or firing decision isn’t just about that person, but about the overall morale and productivity of the company. A purchasing decision may affect scalability or profitability. What is this decision intended to achieve, and will it achieve that?
Err on the side of action
Notwithstanding the above steps, try not to let the desire to gather even more information, or perform even more analyses, get in the way of making an actual decision. As a leader, part of your role is to take action and be accountable in the event that something goes wrong. While it can seem overwhelming to sift through everything, experience will allow you to quickly identify the relevant data and draw on previous context to perform the analysis. At the end of the day, the decision has to be made.
Decision making can feel particularly challenging when the workplace is at its fastest and timelines seem short. Often, it’s just a case of being able to step back and weigh the pros and cons. Have you had to make a controversial management decision? What did you take into account?
This article was written by Tanya Ashworth-Keppel on behalf of the Australian Institute of Business. All opinions are that of the writer and do not necessarily reflect the opinion of AIB. The following sources were used to compile this article: Forbes, Entrepreneur and Inc.