When you are an entrepreneur, it can be tough making important business decisions. The buck, as they say, stops with you. If you make the right decisions, your business will flourish. Make bad decisions, though, and it will all be down to you. Procrastination is not going to drive a business forward, though. Some people would even say that bad decision is better than no decision at all. So, if you find yourself being indecisive, here are 10 tips to help you make better business decisions.
1. Define Your Goals
When you are making important business decisions you must have well-defined goals. And, those goals must be quantifiable and measurable. Having a goal of increasing turnover is all well and good. But, by how much do you want to increase turnover by, and in what timescale? If you don’t set well-defined goals, you will have nothing to measure the success of a decision against. And, you and your team will have no targets to aim for.
2. Consider all the Possible Outcomes
Consider the impact on your business that your decision could have. Look at both the potential positive impacts of your decision and the negative ones. Moving to larger premises, for example, might allow you to increase production. But, could your business afford to pay the high rental costs if the demand for your product falls. It is impossible to foresee everything. Even so, you should consider the impact of as many of the possible outcomes as you can.
3. Break Major Decisions Down
Before you make a major decision, break down that decision into its parts. Relocating a business, for example, will have many implications for a business. Breaking down a decision will make it easier to cost each of the steps that your decision will entail. It will also make it easier to identify any obstacles that may lie ahead.
4. Ask for Other People’s Opinions
Even if you are 100% convinced in your mind that your decision is the right one, it never hurts to get a second opinion. In some cases, getting legal or professional advice will be essential. In other cases, the input of business peers, employees, and friends will be helpful. In the end, the decision will have to be your own. Even so, input from other people can be invaluable. Even if you do choose to ignore their advice, it will help to ensure that you have considered all the possibilities.
5. Step Back and Take A Break
Don’t get rushed into making decisions. Take your time, relax, and think it through first. Most business decisions do not need to be instant decisions. So, give yourself time to weigh up all the facts and all the potential outcomes. Sometimes giving yourself a complete break from the decision-making process can be helpful. The subconscious mind is very good at organizing thoughts. That’s why sleeping on a problem can often bring unexpected clarity.
6. Don’t Try to Make Everyone a Winner
Running a business can mean that you must make some tough decisions. Some of your decisions may even impact on people’s personal lives. Promoting one member of your team may disappoint other members of the team. Some people may have to lose their jobs so that others can have job security. Even so, you must make decisions based on what is best for your business, not on what will please the majority.
7. Look Closely at the Numbers
All important business decisions will have an impact on cash flow and profit. So, make sure that have adequate financial information about business decisions. Look at financial forecasts for all the possible outcomes. Assess the potential impact on both profits and on cash flow.
8. Be Open to Other Possible Solutions
Be prepared to think outside of the box when making business decisions. Is there a solution that you haven’t yet considered? Is there a way that you can turn an obstacle into an opportunity? Keep an open mind. Consider even the possibilities that go against your first instinct. Look at each possibility from an objective point of view before you rule it out.
9. Don’t Let Past Experiences Rule Your Head
You will have learned from past experiences. But don’t let the past cloud your judgment on current decisions. Each business decision that you take will have its own set of unique parameters. There is no guarantee that a decision that you made in the past will have the same outcome as a decision you make today. Look at each challenge you face with a fresh pair of eyes. Make decisions based on the facts that you have in front of you now.
10. Structure Your Decision-Making Process
A structured approach to your decision-making process will help you make better decisions. Develop a checklist of things to consider when making an important decision. Then, check each one of those items off every time you are considering your options. You can only make decisions based on the information that you have to hand. Even so, a structured decision-making process will ensure that you don’t miss anything.
Making business decisions can be a daunting task. Not least of all because no one can ever be 100% certain that the decision they make will be the right one. You can, though, increase your chances of making the right decisions. You can do that by analyzing the possible outcomes and weighing up the pros and cons in a logical fashion.
If you have any questions, our team would be more than happy to help. Call us today at (484) 893-4055.