Do you consider yourself an emotional or a rational decision-maker? If you are like many leaders I have met in the entrepreneurial ranks, you think you are both. Some of my clients would just argue that their emotions are rational. Regardless, what I would like you to consider is that your decisions may not be as good as you think they are and that you might need to use different approaches, depending on your circumstances.
Do Your Tendencies Get in the Way?
I find that many leaders are capable of making good decisions but their tendencies get in the way, including: proclivity towards intuitive decision-making, bias toward action, failure to listen to others, listening to unqualified people, looking for people that share their opinion, failure to use available data, or not understanding the complete set of questions that should be answered in order to make the decision. Many outgrow these tendencies after they lose enough money and/or relationships. However, too often they don’t make enough adjustments, and many do not realize they have the above tendencies. The problem is we do not keep score of wrong and right decisions, and many times it is impossible or too costly to find out whether a decision we made was the right one.
Do Not Confuse Ability to Earn Wealth With Good Decision-Making
Do not confuse your ability to earn wealth with good decision-making. I have encountered many wealthy executives that would be great candidates for reality television shows because of the way they go about decision-making on a day-to-day basis. They would have crowds laughing for days. Picture an investment broker that advises you to purchase 10 stocks. Nine of those stocks lose money pretty badly, but one makes a lot of money, so the portfolio shows a profit. Would you want to keep that broker? My wealthy reality TV candidates would try to convince you they were great stock pickers because they made money.
Questions to Consider to Avoid a Bad Decision
In any given day, a leader makes many decisions. Here are some questions that I suggest you consider before you possibly make another bad decision:
- What is the goal of the decision?
- What are the consequences/costs of making a bad decision?
- What should my role be in this decision?
- Do I (we) have the expertise to make a proper decision?
- What criteria should we use to make a good decision, and how will we rank and weight each item’s importance?
- Are there proven tools to help us make this decision?
- Who else should be involved in this decision, and what role should they play?
- How much information is appropriate for this decision?
- How much time should I spend on this decision?
- How long am I willing to wait to make this decision?
- How many alternatives should be considered?
Call Howard Shore for a FREE consultation at (305) 722-7213 to see how a business coach can help you make better decisions.