Decision-Making, Part 2: How to Make Better Decisions

March 8, 2017

Business woman is standing against blackboard with drawing weight scale.

Last month we explored how to avoid decision fatigue, which can lead to bad decision-making. But even if you are rested, fed and armed with the right data, making good decisions can be tough. In a recent survey, 60% of managers said their organizations were making as many bad decisions as good ones.

Here are some ways to help you choose wisely.

Consider more options
One mistake many managers make is not considering enough options, or only giving one option serious consideration. Studies show that people are more likely to make a better decision if they broaden their options and, as one business leader calls it, “fall in love twice.” If you have two great choices, you are less likely to rationalize away the flaws in your first option. One way to find a second option is to imagine that your first choice is unavailable to you. What would you do in that case?

Consider more estimates
When it comes to numbers, the wisdom of the crowd is better at estimating than the judgment of a single person. For example, if you’re trying to guess the number of jelly beans in a jar, you’ll usually have more luck if you take the average of many guesses, than if you guess yourself. If you have to decide how much time or money to allot to a project, the best way is to get more people to give you estimates and then either choose the average of those estimates or pick the number that seems best. If finding additional people is not an option, your best bet is to do your research twice and make two separate estimates and pick the average.

Consider choosing now and choosing later
Should you go with your gut or should you weigh all the options? If time is not a factor, do both. Pick one option and then step back from the decision for a while. Come back to it a few days later, do all your legwork, gather all your data, and pick an option based on that. If it’s the same option, then you know you were on the right track. If it’s not, then at least you’ve narrowed your options down to two, which is a lot easier to deal with, and which brings us to…

Consider flipping a coin
We’re serious. Let’s say you’ve done all your research and have narrowed down your choices to two options, but you still can’t figure out which option is best. Maybe you’re even getting fatigued. You are probably running into a problem known as analysis paralysis. You’ve thought so much about this and considered so many factors you just can’t see what choice you actually want. If this is the case, flip a coin. The coin will cut through the clutter and tell you what you really want. Maybe it lands heads and your first thought is that you’re sorry it didn’t come up tails. Well, now you know what you really wanted.

Consider failure
This is important because no matter how smart you are about making decisions, you will not always succeed. Considering the possibility of choosing badly can also help you make a smarter decision right now. Before making your final choice, ask yourself these questions:

How will this be the wrong choice?
Make your decision and step back from it. Then ask yourself how it will go wrong. This may change your decision, or it will help you with the next question.

What happens if you’re wrong?
It’s always good to have a backup plan.

For more help with management skills, contact Vanguard Resources.