Reflections and good decisions
Making business decisions is vital for any business, yet few business leaders will take time to reflect and consider what makes a good decision.
“In business we often find ourselves having to make decisions that change our future, sometimes profoundly,” says William Buist, Founder, xTEN Club (www.williambuist.com). “Just take for example the change that will affect us all for years to come as the UK leaves an association of countries that it has been a member of for nearly half a century.”
“During my time as a senior Risk Manager in the UK’s Financial services Sector the consequences of some of the decisions I had to take to mitigate risks in the business could involve many things. Hiring additional people, making others redundant, reshaping the nature of the business by changing processes in order to eliminate risks that the existing methodology created, and much more. Good decision making was always, and remains, critical. That’s a skill that is rarely taught and far less frequently seen,” continues Buist.
But what makes a good decision?
“When I ask that question of others they often refer to outcomes in their answer – such as ‘a good decision is one that gets you the result you wanted’. That would mean making a decision to bet on a horse at 100 to 1 would be a good decision of it won, and a bad decision if it lost,” says Buist.
“I would say that when the horse wins it’s a lucky decision. Whereas a good decision must surely be objectively capable of being ‘good’ long before the outcomes are known.”
Yet many ‘good’ decisions have adverse outcomes – not because the decision making was poor; but more often it is because of an external and unexpected change after the decision was made. Whilst this is at the heart of risk management, mitigation is all about taking good decisions to minimize risk, but also knowing how to handle change when it arises.
“Good decisions must be robust,” continues Buist. “They should consider all the identifiable factors and alternatives (including doing nothing). Then that knowledge must be applied with skill, and drawing on experience, with thought to consequences. Finally, there is need to both understand and measure the outcome.”
“But, perhaps most importantly, no good decision is taken, and then stuck to regardless of what transpires after the decision has been taken. Working strategically in our businesses we must look, objectively, at the available evidence and the consequences of our intentions to the best of our ability,” says Buist.
“Then we must put in place the right measures and feedback loops to check those changes as they progress. By doing both, then our chances of delivering the outcomes we seek increase dramatically.”
“If we are constantly watching our markets, speaking to our customers, and developing ourselves, when we are in a position to take the right decision at the right time – and do it well,” comments Buist.
Do you have business changing decisions to take soon? Are you sure you are considering the right factors, and putting in place the right measures? Are you making the best decision that you can? Then book a free 30 minute call with William at www.williambuist.com