Making decisions at the best of times can be tough but making business decisions is even harder, mainly because the decision won’t just affect you, so you must run through all the possible outcomes.
In business, most of the time it’s all about risk and depending on the level of risk you are willing to take this will often affect your business decisions. Some people make very low risk decisions and will only do things if there is plenty of evidence it will work, some make calculated risks which I would say are at medium level so they are confident in the outcome but there is still a risk element and then there are those that are very instinctive and will take a risk from the outset and jump quickly in to deciding.
So far in my business life, I would say I fit within the medium level risk taker category, I think you should take risks to grow a business but I do like to ensure they are calculated risks. I have also made the mistake in the past of ignoring my gut instinct and listening to other people’s advice but every time this has back fired so I would say if it feels wrong it usually is and if it feels right then go for it.
Being an entrepreneur and running a business, which is growing so rapidly, I have to make decisions all the time and although some are more complex than others I always go through the following processes:
1) Pro’s and Con’s – depending on how big the decision is I will either just do the list in my head or sit and write them down. This enables you to then see clearly if the decision you are about to make out ways the cons or whether it was a good idea but has more flaws than you first thought.
2) Use a trusted Sounding Board – Talk to someone you trust and use them as your sounding board for decisions, I don’t always listen to other people’s advice but for me the most important thing I find in sounding your ideas out is when explaining them to someone you often notice something that’s missing or that you hadn’t considered.
3) Gut Instinct – Always go with your gut instinct, even though this saying is very cliché. It’s true. Your gut instinct is normally right and that’s why the saying is used very often.
4) Don’t over think it! – Don’t over think your decision, put a time limit on making your decision which will depend on how small or large it is. In business you have to react quickly, in some cases so you need to be prepared to make decisions quickly and to not over think it. I think if you overthink things you end up making clouded decisions as you end up confusing things or going in to, too much detail that is not necessarily needed.
5) Always have a backup plan – If your decision doesn’t go as planned, a backup plan is your one to go to. You should always have one of these in the back of your head to ensure you’re going to get back to the place you were before. This is my main tip and one I always use, as it then gives you the comfort to take those risks.
There are 3 types of decisions that can be made when running or working in a business:
Strategic decisions are normally made by senior management and are usually long term and complex. The decision made would affect the company as a whole and one that must be well thought out.
Tactical decisions can be made by the middle management as they are less complex. These decisions normally follow once strategic decisions have been put in place to comply with them.
Operational decisions are day to day decisions that can be made by various tiers within the company. They are mainly simple and routine to ensure the tasks get done.
Everyone makes mistakes and in life you will make some wrong decisions, but for me I have always ensured I then understand what went wrong so I can learn from the mistakes and ensure they don’t happen again.