Life is about making choices, and those choices have consequences. In business, leaders are constantly making choices: which projects to prioritize, which candidates to hire, which vendors to select, which targets to acquire, which virtual background to use in the next video conference.
If business is a test, many leaders under pressure often treat these decisions as true-false questions rather than multiple choice. They look at each potential solution as soon as it’s visible, and decide “yes or no:” if yes, stop looking for alternatives; if no, move on to the next yes-no decision.
Another approach is to collect potential solutions and evaluate them as a set. What are the comparative strengths of each? How could the leader construct a hybrid solution by combining the best components into a single solution? Can one long-shot solution become negotiating leverage against the incumbent? And finally, have you evaluated your potential actions against the alternative of “do nothing” ?
But don’t dawdle: according to some research on optimal decision making, collecting too much information before making a decision can be worse than making a snap judgement using intuition alone.
Once a decision has been made, is a leader willing to change course if the results don’t come through as expected? A common bias is the sunk cost fallacy – the cause of “throwing good money after bad.” After making a decision, re-assess the path you are on versus the alternatives that are still available. Net of additional switching costs, can what you have learned since the initial decision lead to a better outcome with an alternative solution?
Leaders face a barrage of decisions each day. My intent is that the techniques outlined above help you achieve better outcomes from at least a few of those decisions. Please use the comments to provide your feedback and questions.