Sharpen Your Decision-Making Skills

selling a business

In starting a business, making smart decisions is as important as being willing to work hard. But making decisions is a lot tougher than it looks, says Erik Sherman for People working to get businesses off the ground know this, and that’s why they often put a premium on being smartly decisive.

Being smart, though, isn’t always an obvious path. Too many people associate decision making with being abrupt and forceful. There are more subtle and less obvious changes you can implement to make more effective and useful decisions. Here are four techniques you can adopt to improve how you make decisions–and run your business–today.

Dump data

We live in a data-mad society. Big data, social data, data mining–there’s so much data around, and so many things you’re supposed to do with it, that it’s a wonder many entrepreneurs don’t curl into the fetal position and enact a new type of data regression, where the mound of data causes you to regress back to the womb.

There is a lot you can learn from data, but it can also trip you up and make you crazy. Depending on your decision, a lot of data simply doesn’t matter at all, or its relevance is tangential at best. A classic example is when you’re about to enter a new market with a new type of product–a common consideration for an evolving business strategy–and you start to look at historic product movement. Big mistake. You’re spending time considering how sales went with different types of customers who bought something else entirely.

Be ruthless when it comes to data. As you’re probably trying to expand your business with speed, focus on the information that can make big changes in what you do. When the business has gained some bulk and growth rates have slowed, you can possibly consider some of the more subtle relationships. But even then, be careful that you don’t waste time on things that don’t matter.

Let the little people decide

It’s good to be king–or boss. You chart the course and set sail, leading your crew into the unknown. Many entrepreneurs come to the conclusion that because they are finally responsible, they should make all the decisions. After all, who knows better than they?

You’d be surprised. The more the company grows, the more removed you become from day-to-day business. Maybe at first you’re doing sales, possibly making products or providing customer service, but eventually you have to move beyond that and run the whole company. That’s great, but as long as you micromanage, you are still stuck doing the regular work.

Furthermore, as your role expands, you become more out of touch with daily operations and the current opinions and inclinations of customers, no matter how much you believe that you’re still current. There are many decisions where you would be better off if the people actually doing the relevant job made them: There’s a greater chance that they’re right, and you save time.

Welcome mistakes

Speaking of being right…understand that many decisions, even the ones you make, won’t be correct. You’ll make the wrong call time and again. That’s OK, because if you embrace errors and mistakes, you can learn from them. And it’s not as though they won’t happen if you don’t embrace them.

In addition, recognise the chance that even your most critical decisions have some chance of being wrong. That alone can reduce anxiety and an inclination to put off decisions. Don’t fuss over them. Make the call. If it’s wrong, come up with a better choice. If it’s right, then go on to the next order of business.

Skip decisions

Finally, there are all sorts of decisions that probably seem critical and yet aren’t. Think of the investor who watches a stock portfolio. The stocks move up, move down, day by day. There’s a great temptation to constantly react, selling, buying, balancing the portfolio. But the little movements may not be important, outside a major crash of one company or another.

Learn to ask whether what you see is a real trend or one of life’s jitters. Noise is annoying and not worth the great attention a decision would require. Focus on the decisions that matter and let go of the ones that won’t.