Studies suggest that the average person makes 35,000 decisions every day. These may be big or small, conscious or subconscious, but they all matter. When you’re in a high-stakes position as an entrepreneur, business owner, or leader, wise decision-making is especially valuable. We always want to choose what’s best for ourselves, our team, and our business.
But taking confident, decisive action is easier said than done. With the weight of that responsibility, many people struggle to make their choices with confidence. If you want to learn the secrets of making wise business decisions, keep reading!
6 Secrets Behind Wise Business Decisions
Secret #1 – Remember Your Big Picture Goals
Perhaps the most crucial question to ask yourself when you’re at the crossroads of a decision is this: how will my choice serve the interests of my short and long-term goals? None of us should make decisions until we understand how they fit into the big picture. If a choice doesn’t serve your goals, it’s probably not the one to make! If you don’t keep your interests in mind, your decisions may take you further from where you want to be. Stay focused!
Secret #2 – Gather Information (But Not TOO Much Information)
Due diligence is vital in making any decision. Investigate the ins and outs of all potential avenues: the benefits, risks, costs, and complications. That said, don’t allow yourself to fall into analysis paralysis. This happens when you want to know everything before making a decision. This mindset will prevent you from picking a path at all because you can’t know everything. You can’t anticipate every outcome.
Learn to be content with gathering quality information from good sources rather than speculating yourself into a standstill.
Secret #3 – Explore Decision-Making Models
Make you want a little more structure in your process. Lean on a decision-making model! Here are just a few options to explore:
Rational Decision-Making Model
This model assumes that decision-makers are rational and capable of making logical choices (we hope!) that maximize outcomes. The process involves several steps, including identifying the problem, coming up with alternatives, evaluating them, selecting the best option, and implementing the decision.
SWOT Analysis
SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. This model involves identifying and listing internal strengths and weaknesses, as well as external opportunities and threats. Then, we analyze how these elements “duke it out” to make a decision.
Cost-Benefit Analysis (CBA)
CBA is a systematic approach to evaluating a decision’s potential costs and benefits. It identifies and quantifies all relevant costs and benefits associated with each option, compares the total costs and benefits, and selects the option with the highest net benefit. If you like logic, this one’s for you.
Decision Tree Analysis
Decision trees are graphical representations of scenarios that help evaluate the potential outcomes of different choices. If you’re a visual learner, this method may work for you.
That said, it goes deeper than its visual arrangement. It works by mapping decision options as branches on a tree structure, assigning probabilities to possible outcomes, calculating the expected value of each alternative, and selecting the option with the highest expected value.
And, if all else fails, you can always fall back on a list of pros and cons for each option!
Secret #4 – Seek QUALIFIED Input
If you’ve spent any time on the internet, you know that opinions are not created equally. As you navigate life’s tough decisions, seeking advice and input from qualified people helps. Speak with other professionals, mentors, and advisors who know and understand your situation. Just remember that their advice is limited by their own knowledge and experience. Weigh outside perspectives appropriately, but know that, ultimately, you must choose for yourself.
Secret #5 – Tune in to Intuition
A gut feeling alone doesn’t make good decisions. After all, there is a multitude of reasons for our knee-jerk reactions. Intuition, though, can be a valuable complement to logical analysis. Going with your gut isn’t about letting your feelings direct your life. These are instincts, not just emotions or anxiety. Science shows that intuition is powerful. While simple logic is excellent for simple decisions, complex, multi-faceted issues can benefit from our gut instincts.
Listen to your gut if you consistently feel a certain way about a decision, especially after digesting the data!
Secret #6 – Track Results
Decision-making doesn’t end with a singular choice. Wise decisions are followed by a process. This process tracks results, identifies issues, and adapts. Don’t be a “set it and forget it” decision-maker. Instead, follow up attentively!
What principles guide you when there’s a tough decision to be made? Share your process in the comments.