I often hear from my CEO and senior leader coaching clients about their challenges with decision making - everything from feeling pressured to get it right as the final decision maker in the organization to getting bombarded with employee requests to make decisions throughout the day. Some leaders second guess themselves when there is opposition to their decisions and it’s also challenging to get the most current/relevant data and interpret it in a way that leads to making the best decisions.
This article shares 5 keys to effective decision making for CEO’s.
Use data effectively.
As a CEO you are making an extraordinary number of decisions on a daily basis. From your years of experience many of these decisions can be made quickly from intuition. However, in order to be competitive, the big decisions need to be made from data analysis. This may seem obvious yet it can be difficult to interpret what the data is revealing and what the best course of action should be.
Are you working closely with your financial staff to regularly get the data required to make sure the company is on track to meet fiscal goals? Is the data presented with graphs and charts which can be easily understood? Asking curious questions as the CEO is key to making these data driven conversations productive.
As a caveat, make sure you are in a good mental and emotional space to participate in the data discussions. Fatigue, too many other things on your mind, etc can cloud your judgment and potentially risk you missing important information that you need to consider. There is a school of thought that greatly reducing the number of smaller decisions you have to make will free you up with more brain energy for the bigger decisions. Things like meal planning, what clothes to wear, etc can be made ahead of time so you don’t have to think about it.
2. Recognize that the more effective your leadership team, the fewer decisions you need to make.
A leadership team that you have high trust in can make many important decisions. In fact, the decision points that will impact their work directly should be made by them. I’ve seen CEO’s and other leaders create delay in making decisions that should happen more timely because of an over reliance on the CEO to be involved in all of the decisions of the organization.
As the CEO asking yourself these questions can help you decide where you stand in this regard: What’s my level of trust in my Executive Leadership Team to make important decisions without my input? What type of decisions am I making that I can delegate to my team? Are we experiencing delays in making key decisions because of the bottleneck I am creating?
If this area is a problem for you, consider working with an executive coach to become more aware of your blind spots and to get support in growing yourself to become even more effective in your role.
3. Make decisions in alignment with your organization’s mission, vision and core values.
When in doubt go back to your company’s mission, vision and values. It’s easy to stray from your mission when something shiny comes your way that appears to add immediate value to your organization. Decision making becomes easier when vetted against company mission, vision and values.
As the CEO, it is imperative that you are overcommunicating the company’s mission, vision and values. Part of your role is inspiring and motivating employees to believe and get excited around what your company stands for. One way to check to see how you are doing in this area is to informally poll employees and see if they can tell you what the mission, vision and values of the organization are.
4. Be decisive.
Study on the 4 top qualities of the most successful CEO’s published in Harvard Business Review (https://hbr.org/2017/05/what-sets-successful-ceos-apart) show that decisiveness is better than making all the right decisions. CEO’s that exhibit conviction in spite of missing information or poor data, and have the attitude of “a wrong decision made is better than no decision at all” are more successful than the other CEO’s studied. In fact according to the study, among CEOs who were fired over issues related to decision making, only one-third lost their jobs because they’d made bad calls; the rest were ousted for being indecisive.
If you are the type that needs to process a great deal and are concerned about making the perfect decision, assess whether this is working for your organization. Chances are that there will be some bottlenecks in projects and this style is negatively modeling to your employees the behavior of slower, overly analytical decisions. And you can take comfort in the fact that if the decision was a poor one you can most likely change it.
5. Once a decision is made, ensure team alignment.
Now that you’ve finalized a big decision make sure your team is fully aligned in implementing without disgruntlement because they may have disagreed with your decision. Unlike dealing with a 2 year old and saying “because I said so” be authentic and transparent and share the why of the decision. How does this decision fit into the overall company strategy?
If there is a downside to your decision it’s more authentic to acknowledge that while still giving confidence that you made the best decision considering the options and data.