In last week’s blog post, “Your Business is Not Powerball”, I shared a leadership reality – achieving success in business is not about LUCK. It requires deliberate planning, clear choices and the skills to execute on them.
Today, I want to talk more about that second part – the process of making choices. As I work with business leaders, I continually find that this is a challenge for many.
- Set criteria
The first step in making any choice is to define the desired result – you do this through establishing criteria. Starting with the reason why the decision is necessary, you then identify all of the characteristics of the optimal choice and all of the factors that you seek to avoid. This is also where risk factors can be identified and weighted.Example: In hiring a new employee, key criteria might be industry experience, relocation requirements, management experience, leadership style, cultural fit, etc.
- Identify options
Next, it’s important to identify all potential options that can be chosen – both traditional & out-of-the-box ones. Sometimes it seems that leaders are faced with tough choices where there are no alternatives, but double checking that assumption can prove surprising.Example: Faced with losing a significant customer, it seemed the leader had no choice, but to cave in to price pressures. Taking one last attempt at a better solution, she began brainstorming alternatives. This exercise not only identified an option to keep the business, but expand revenue by creatively bundling products and value added services together.
- Evaluate options
Once all options are identified (#2), evaluate each option against the criteria developed (#1). Rely heavily on available facts and minimize assumption and bias where possible. This step can be done quantitatively or qualitatively, but regardless of how it’s done, it is critical that choices are wisely vetted before they are made.Example: Looking to improve competitiveness, a higher education institution developed a list of college selection criteria (#1). They then rated their institution and all other competitive institutions (#2) opposite these criteria. What emerged was not only a clear view of their competitive position, but a prioritization of the top 3 areas for improvement.
- Choose the top priorities
This fourth step is the decision-making step. It’s where leaders must make clear choices to direct the organization. Sometimes only one choice can be made, but other times, several options (<3) can be pursued. Ultimately, this decision not only directs the organization on what TO do, but also what NOT TO do.Example: Leading a regional business, the leader had 7 different industries to consider for growth. Market analysis had highlighted 2 high priority industries, but he spread his team and budget across all industries equally. Instead of making wise choices for growth, his low risk strategy yielded a low return as a result.
- Monitor choice
We do not control all factors influencing the choices we make. External market shifts, economic challenges and other environmental factors can change on a dime. That is why step #5 is so important for wise leaders. Post-decision monitoring helps track progress, identify potential challenges and provide for mid-course corrections where needed.
Making choices is key to success in business, but it is also a significant challenge for leaders to do well. Whether the choices are strategic or tactical, this proven methodology can be used to ensure wise choices and create positive outcomes.
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