How the Best Business Leaders Make Big Decisions
Every business decision is taken with a certain degree of risk. When entrepreneurs make a big decision it can affect the outcome of their business.
When the CEO of a large corporation decides on a course of action, it is taken with the weight of responsibility of hundreds of employees and stakeholders. Most of them have strategies they call upon to help them. They will reason them in the same way as most other people do in everyday situations, but what makes them so comfortable in making big decisions?
Sometimes a CEO wants to know what certain decisions will feel like on the ground. Leaders might gather departments heads together or talk to them individually to seek insight and feedback on potential effects. What they are doing is making evidence-based decisions based on the views of those at the top of each section of a business. People won’t always agree that shifting a headquarters overseas is the right decision, but that’s exactly what a CEO is after – people who are prepared to argue another point of view.
Many people put too much emphasis on past incidences and historical results. While it is important to consider how previous decisions played out, most senior business leaders spend less time fixing things that went wrong than being proactive in decisions that will affect the future going forward.
Delegation of Responsibility
Not all decisions are big decisions, often there might be a lot of smaller decisions to be made, which aren’t always the responsibility of the person at the top. Delegating these to managers or section heads both empowers their own decision making and allows their natural leadership strengths to shine.
Unafraid of Conflict
Many leaders often fall short of expectation and potential because they are busy avoiding the really tough calls in their organisation. Leaders that put off decisions or try to please too many people, won’t be doing what is right for the business. While stakeholders and employees are important, what is best for the business isn’t always best for individuals and big-time leaders are prepared to tell it how it is.
The same goes for everyday decisions
How business leaders make big decisions isn’t actually any different to how many other decisions are taken in life. For example, deciding on which High School to send your child to can have a direct influence on the quality of their education and the opportunities that come with it. How far do you have to travel to get them there? What is the cost (if private) and what benefits does one school has over another?
Even simple games have consequences if they aren’t thought through. For instance, you can play Bingo for real money, like in the Deal or No Deal game where reaching the feature round presents the choice of either an offer from the banker or the box you started with at the beginning of the game. In this instance, a confident leader will understand when and whether it is a good decision to switch.
Then there are the times when there is no right or wrong answer, like choosing a gift for a partner. This is usually a time when it is often beneficial to not procrastinate over the decision but to be confident of the choice and run with it.
Top-level CEOs know the full facts surrounding their choices, they know the certainty or the odds of a particular course of action and they can make a decision when pressed. This is the skill that the most successful business leaders have alongside the decision-making strategies outlined. It is using knowledge, preparedness and confidence that means they more often make the right decisions.