Decision-Making Skills for Effective Leaders

by Craig Anthony

3 min read

Perhaps the most vital leadership quality is being a good decision maker. This especially applies to tough decisions, the ones that have a lasting impact on the trajectory of your business. Anyone can make easy decisions for what to wear, which restaurant to visit for lunch, or how to arrange the furniture in their office, but mastering the process of making tough decisions separates great leaders from mediocre ones.

Since leadership involves managing people, the most effective leaders foster good decision making in a team setting. This requires establishing a constructive decision-making environment, removing elements that inhibit successful decision making, and bringing everyone together after the decision is made, including those who opposed the outcome or were adversely affected by the result.

Establishing a Constructive Decision-Making Environment

Positive and negative decision-making environments are like night and day. If you’ve ever found yourself in one of those insufferable work meetings where no one seems to be on the same page, everyone is talking over each other, and the attendees aren’t even clear what the topic at hand is, and when the meeting is over, you’re further from a consensus than when it started, then you know what a negative decision-making environment looks and feels like.

To establish a positive decision-making environment, first get everyone on the same page by briefing them on the topic at hand. What is the problem you’re trying to solve? Is there an end result you’re hoping to realize? What are some obstacles you’ve identified that are in your way? Now that the issue is on the table, you can start attacking it with everyone working together and not against each other.

Then, set some ground rules for the debate and discussion process. Perhaps you know up front that certain employees sit on opposite sides of the issue. Preempt the conversation from devolving into bickering and tit for tat by establishing a protocol for discussing opposing ideas. In political debates, for example, one candidate receives an allotted time to make a statement without interruption, and then the other gets a certain amount of time to respond. A format like this not only prevents chaos from taking hold but also ensures that everyone, not just those with the loudest and most commanding voices, is heard.

Identifying Elements That Inhibit Successful Decision Making

Several issues can inhibit successful decision making. As a business leader, your responsibility is to know what these elements are and prevent them from taking hold in your decision-making process.

Lack of information: To make an important decision, you need all the relevant facts. When glaring information gaps are present, it is human nature for people to fill the void with their preconceived notions, which are often wrong. Before meeting to discuss a big decision, conduct research so you can present all the facts to the group up front.

Too much information: An excess of information can be as big a problem as not enough information. The issue with too much information is that the important facts get bogged down in a heap of minutiae. Again, it is on you as the leader to keep this from happening. Maintain focus by emphasizing what is important and keeping irrelevant details from muddling the conversation.

Status quo: Human beings are naturally resistant to change. The old adage, “If it ain’t broke, don’t fix it,” gets reliably trotted out whenever a looming decision presents the possibility of upheaval to the status quo. In a fast-moving economy, however, sometimes things that don’t appear broken still need fixing, or at least updating. Payphones worked fine in the mid-1990s, but if companies didn’t update their business model as technology evolved they would have found themselves behind the curve or, in some cases, out of business.

Post-Decision Reconciliation

After you make a decision, there may be some hurt feelings on behalf of those who opposed the choice that was ultimately made. Especially in situations where team members stand to be adversely affected by the outcome of the decision, it is vital to get these people to buy in and understand why the decision is beneficial in the long term. By letting employees unhappy with the decision form their own faction and continue opposing it, you sow the seeds for a toxic workplace environment.

For example, maybe your business decides to change the pay structure for your sales team to one that reduces the base salary and emphasizes commission. Certain salespeople might receive lower paychecks once the new structure is in place. However, you can get these employees to buy in by explaining how they can exceed their previous salary with commissions by reaching a certain sales volume, and by stressing your commitment to providing the training they need to get to that level.

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