In the course of day, the typical businessperson makes dozens of decisions: Grande or venti? The taco truck or Chinese takeout? Diet Coke or Diet Pepsi? Cardio or weights? Yes, the business day is full of choices! But while deciding on your morning coffee, lunch, an afternoon soft drink and your workout may be relatively easy, many business people—and by extension, businesses—have a hard time making actual business decisions.
Should the company green light a new product or send it back for more focus group testing? Should we try a risky new marketing strategy or stick with what we know, even if the results have been lukewarm? Do you fire that problem employee or decide it’s easier just to live with them?
Motivational speaker Brian Tracy espouses a decision-making process called “Zero-based thinking.” Zero-based thinking allows harried businesspeople to call time out and make sound—even difficult—decisions and course corrections more easily.
While most businesspeople make “gut” or instinctive decisions, evidence-based management demands logic and reasoning.
Zero-based thinking uses hindsight to judge the success or failure of decisions. Tracy advises decision-makers to look back on a recent decision and ask if they’d make the same decision again, knowing what they know now. If the answer is “no,” then Tracy says it’s time to change course.
The Harvard Business Review offers another technique: evidence-based management. While most businesspeople make “gut” or instinctive decisions, evidence-based management demands logic and reasoning. Harvard Business Review offers three tips:
- Demand evidence. Demand to see the data and not just someone’s opinion.
- Examine logic. Take a close look at the reasoning behind an argument and see if it collapses under scrutiny.
- Encourage experimentation. No data? Encourage those under you to create some by testing various solutions to a problem. Use their results to help make your decisions.
Pepperdine University’s Graziadio Business Review offers yet another tool: decision trees. Using rectangles to represent decisions and circles to represent risk or uncertainty, managers benefit from having a graphical representation of the problems they face.
Regardless of the tools businesspeople and companies use to make decisions the most important action is actually making the decision and sticking with it to see the results through. The cost of not making the decision can be extremely risky and detrimental to the company and to morale. While change is uncertain, true leaders know that when the status quo isn’t producing the desired results, someone must effect change within the organization. If they don’t, the likelihood of producing the definition of insanity, “doing the same things over and over and expecting a different result”, is a likely outcome.