A Cheat Sheet To Making Great Decisions!

April 22, 2024 thehrobserver-hrobserver-cheatsheet

In the fast-paced world of business, the ability to make effective decisions is paramount. Every choice we make has consequences that can shape our future trajectory. But how do we ensure that our decisions lead to positive outcomes? In this guide, we will explore the fundamental principles and practical strategies for making great decisions consistently.

Decisions, whether trivial or monumental, can be daunting. The fear of making the wrong choice often paralyzes us, hindering our progress and preventing us from seizing opportunities. However, by adopting a systematic approach and cultivating certain habits, we can enhance our decision-making skills and navigate even the most complex situations with confidence.

Drawing inspiration from industry luminaries such as Andy Grove, former CEO of Intel, and Larry Page, co-founder of Google, we will dissect the essential components of effective decision-making. From the importance of staying informed to the value of embracing fast decisions, each principle will be accompanied by actionable tips and real-world examples to illustrate its relevance in various contexts.

Whether you’re a seasoned executive, an aspiring entrepreneur, or simply someone seeking to improve your decision-making ability, this guide is designed to equip you with the knowledge and tools needed to succeed.

1. Always Be Closing Collecting Information

I consider this the most important step: you need to not only be in a constant state of being well informed on the world around you but also what is going on in your business and team.

Andy Grove, legendary former CEO of Intel, describes in his book “High Output Management” the 3 distinct ways managers can create leverage:

  1. Information gathering
  2. Decision making
  3. “Nudging” others

If you only start looking for information at the moment of thinking about a specific decision, you will be making poor decisions, and you’ll make them slowly as well. Speaking of speed of decision making, let’s move to the second most important tip.

2. Make fast decisions

“There are basically no companies that have good slow decisions. There are only companies that have good fast decisions.” – Larry Page, founder of Google

In other words: all slow decisions are bad.

Practical tips to reduce the decision cycle time:

  • Time-box every decision, and create artificial short deadlines when there isn’t a natural deadline.
  • Limit the iterations of feedback and input to 1 or 2 iterations max. 
  • Remind yourself that 99% of decisions are reversible two-way door decisions, and can be reversed easily if wrong.
  • Most decisions should probably be made with somewhere around 70% of the information you wish you had. If you wait for 90%, in most cases, you’re probably being slow. 

3. No decisions by committee

Every decision should have one, and only one, decision maker. We shouldn’t confuse getting buy-in with decision-making by committee. We need to trust each other and divide and conquer. There are 30 different ways to do something, 10 of them would work, we just need to find one.

Having just the single decision maker is also great for the empowerment of the team members, as well as for creating a culture of accountability in your team. In my experience most decisions by committee are done this way to intentionally “dilute” accountability, which leads me to my last and final tip #4 below.

4. Safe to fail

The single biggest blocker to quick and effective decision making is fear. If people are afraid to make mistakes, then they will think a million times before taking one step forward. If that resonates with you, or if you find that decision making is pretty slow in your team, ask yourself: do people feel safe to fail?

Making people afraid of failure doesn’t necessary come from reprimanding them or shouting at them for making mistakes. It is sometimes the result of very small seemingly benign things such as; an executive being a perfectionist and reviewing everything and making changes to them before going live.

In some cases when my team ask me to review something I make it a point to only review it after they ship it, to make it a habit that we aim for “error correction” instead of “error prevention”. The only way to move fast is to be comfortable making some mistakes along the way. 

One final disclaimer: apply judgment as necessary. Being a manager/leader is a hard job and it often involves a high degree of good judgment. Good judgment is the byproduct of experience, and experience is gained by just trying to do things and failing a few times. You’ll get it wrong before you get it right.

Editor’s Note: The four guides were previously written by Mohannad in this blog post. He has agreed to rewrite this piece for The HR Observer.

Mohannad Ali

Chief Executive Officer, Hotjar

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