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Five Keys To Better Decision Making

There is one attribute that distinguishes successful leaders from the rest of the pack: these leaders consistently make high quality decisions. While this insight might seem intuitive, notice that the phrase above doesn't read these leaders make more "right" decisions than their counterparts.

Time is the ultimate judge of whether a decision is seen as right, wrong, or bad.

High quality decision making signifies then that some leaders are able to increase the probability of achieving a successful outcome from decisions made. Like great hitters in baseball, they have learned to make the most of their opportunities to generate positive momentum and although the "hit-rate" might be below 40%, in baseball 40% is still good enough to qualify you for the hall of fame!

So let's explore the elements of good, wrong, and bad decision making.

It's easy to confuse good decisions with right decisions although the two are not actually the same thing. A good decision is one that takes measure of all available information and basic facts, assumes and weighs relevant risks, considers contingencies, and drives toward a positive outcome. Examples of good decisions would be deciding to navigate toward your destination via a GPS app versus trying to find your destination without a map. Or deciding to take advantage of the calorie counter on the menu to select a meal option that fits within your dietary goals. Good decisions usually lead to good outcomes. Right decisions are subject to a different standard, however - that of comparison. But to understand right decision making more fully we need to first delve into wrong decision making.

Wrong decisions are decisions that could have turned out good but over time are proven to have been off base - either because basic facts were incorrect or missing, assumptions changed, external factors intervened, and/or the expected result was unrealistic from the start. Examples include taking an ill-advised short cut to arrive at a destination only to learn that traffic is worse on that route; or building a sales forecast based on pure gut instinct with no situational or analytical validation; or scaling a project before receiving any empirical evidence that it can actually work. Wrong decisions lead to learnings that can be recycled to improve decision making. Making and learning from wrong decisions is actually crucial to improving the quality of decisions moving forward. After all, no one gets them all right!

Bad decisions are those that empirical evidence has shown have a very low likelihood of success. To make a bad decision usually involves ignoring one's intuition or moral compass, not listening to advice, outright ignoring facts, and/or maintaining an unrealistic attitude regardless of what the evidence shows. The fallout from bad decision making is usually catastrophic and very difficult to recover from. And there are too many examples of bad decision making to list here.

So now that we understand good, wrong, and bad decision making a bit better; how can we as leaders increase the probability of decisions being proven right over time? Well here are five keys that will do just that:

  1. Understand the facts first: For almost every decision there is a base of facts that can be gathered, interpreted, and understood before committing to a course of action. Successful leaders know this and greedily search for and challenge what is known prior to weighing in. If there are no facts, a smart leader can generate them via piloting, research, or conducting thought-experiments. Then, from a solid factual root foundation, assumptions, risks, contingencies, and expected outcomes can bloom and blossom.

  2. Widen the circle: Sometimes leaders are encountering a situation for the very first time and don't know how to proceed. Usually though, there are others who have experienced if not the same situation, at least something similar enough to leverage as a tool for guiding decision making. By consulting the known body of experience and potential outcomes and not only relying on your own judgement, you can exponentially increase the chances of success. The key here is to give yourself enough time prior to making a call to ensure this step occurs.

  3. Encourage debate: Similar to #2 by not only widening the circle but bringing the disparaging viewpoints and experiences together, leaders gain even more critical insight not only into potential outcomes but also can begin to gauge the instincts and judgment of a wider group as well. Some of the most important decisions in history have been made by way of stimulating debate and stirring argument. Successful leaders are able to employ paradoxical thinking during debates and use the varying viewpoints to find the AND solutions versus the OR solutions.

  4. Plan for failure: Before a decision is made, successful leaders always consider what could go wrong and how to pivot if certain assumptions don't hold up. This step more than any other can turn a good decision into a right decision because it comes with built in contingencies. Likewise, a good decision could turn into a wrong decision if the leader is blind-sided by something they didn't anticipate. This principle is good to apply in a wider group context as well so that the leader receives more inputs to solidify the plan.

  5. Evaluate the degree of success: Once a decision is made it is just the beginning of a learning journey and calibration exercise. Should the decision prove to be right, successful leaders endeavor to understand WHY it was right and how to potentially build upon this "rightness". Similarly, if a decision turns out to be wrong, successful leaders obsess about what was missed and how to eliminate such errors in the future. Bad decisions, if they don't result in the loss of the leader's job, usually cripple them in some other way such as credibility, license to operate, or trust deficit, and future decision making may be taken out of such a leader's hands.

What are your thoughts on the impact of these decision-making keys? What other principles to improving decision making should leaders employ? Let's discuss in the comments below. And it would be a "good decision" to like and share this article with your networks ;)

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