8 Steps to Making Better Business Decisions
Decision-making errors exist within all levels of organizations. Some common examples include:
- Focusing on the symptoms instead of the problem
- Having no clear picture of the desired outcome
- Becoming fixated on only one option
- Making decisions that do not align with the overall goals of the organization
- Missing opportunities to set decision criteria
- Failing to evaluate enacted decisions
It is important to recognize and accept (without blame or shame) that mistakes occur. Then it is time get over it, move on and apply a process that will enable successful decision making.
Here are eight common steps that can be taken to aid in making better business decisions.
- Define the Problem: Get clarity on the actual business problem by examining the symptoms and gathering input from all stakeholders. State the problem clearly in business terms. Avoid technical jargon.
- Know the Strategic Agenda: Find out what is on the strategic agenda of the organization. Ensure that the business problem outlined aligns with the direction of the organization.
- Identify the Desired Outcome: Know exactly what you want to see happen. Know your goals and objectives before you consider the route to get there. Consider aligning with the strategic, tactical and operational levels of the organization.
- Establish the Solution Domain: Consider ideas that might work within the Solution Domain, that is, within the goals, objectives, rules and constraints of the organization. The Solution Domain establishes the context and approach for which alternative solutions can be considered.
- Identify Alternative Solutions: Brainstorm ideas. Have an open session where all ideas are tossed into the ring with no judgment. Refrain from implementation thinking. Focus on solution alternatives. Choose a minimum of three possible solutions per business problem.
- Establish the Evaluation Criteria: Become clear on what is important by creating a list of criteria. Define each of these criteria. Establish the decision-making approach and ensure that the approach fits within the context of the organization.
- Go for It: Choose one solution. Enact it. Allow time for it to work.
- Evaluate. Investigate to decide if the solution has been successful. If a satisfactory result has not been achieved, revisit and rethink the solution. Make adjustments as necessary. For some things this is an ongoing process.
Decision making is a challenge, especially in organizations and where people are involved. A clearly-defined, consistently-applied approach—one that spans all organizational lines—is the key to making better business decisions.
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