It is important to remember that a good decision is seldom an accident. Usually it is the result of research and effort. Also, the right people need to be making the decisions.
“Management and leadership are two different things,” explains Robert Bjorklund, chair of management in the school of business at Woodbury University. “Decisions that have to do with planning, organizing and controlling are for the managers. The decisions that have to do with the vision, setting the direction of the company and lining the units up need to be made by a senior leader.”
Smart Business talked to Bjorklund about the considerations that a business leader should take when making an important decision, the importance of avoiding rash decisions and why it’s a good idea to seek input from employees.
When making an important decision that affects the entire fabric of a company, what considerations should a CEO or business owner take?
You need to understand your motives for the change, as well as what the company’s needs are. Anything that is called the entire-fabric decision is obviously long-term and strategic. Probably, it involves a fair degree of uncertainty, so you might also be asking if your company has the capability and the capacity to carry out what is called for.
This includes resources like leadership strengths, people, finances, credit ratings and so forth. It’s always good to look at best-case and worst-case scenarios. Can the company digest the risk that you’re taking if the worst case comes to be?
Once a decision has been made, should you focus on looking back or moving forward?
You have to look back to find the weak spots that need to be shored up and strengths that you can count on. An example is the background of your people. You may uncover a competency area that you didn’t know about. It’s sort of like opening a package and finding two gifts in it. One of them is something is that you really weren’t expecting.
As far as the future, you need to look there to decide what the leadership is going to have to do. With direction setting, there is a long horizon and managers need to take care of doing things right, in the present.
Do you think the adage of moving fast on reversible decisions and slow on nonreversible decisions is a good philosophy?
There is a little known corollary to Parkinson’s Law that says we spend time considering matters in an inverse relationship with their importance. That is, we deliberate endlessly on minute decisions and then jump quickly on really important decisions.
Irreversible decisions are, right or wrong, important, and they deserve your best and most important consideration. Once you make the decision, go for it, and try not to look back.
And remember, if it isn’t broken, maybe you should break it. Some systems that work well might be doing the wrong thing.
Why is it important to avoid making rash decisions?
Deciding too quickly, without important pieces, is a mistake. Decisions are like puzzles. If the pieces are not on the table, you are not going to get the full picture. I recommend that a decision maker think of the people around them as if they each had pieces to that puzzle in their pockets. Then find a way to get them all on the table. It may take more time, and it may make you impatient, but it’s the right thing to do. You need to have at least enough pieces on the table so you know what the puzzle is going to look like.
With whom should a business leader brainstorm to gain fresh ideas and explore alternate solutions?
You might as well get all of the pieces [staff members] to the table. You’re already paying for them why not use them? You may never get the entire puzzle put together, but you want to know when you’re done if it’s going to be a picture of an eagle or a turkey vulture.
If a decision is made without a group consensus, what are some of the ways to motivate the individuals who are not fully committed to the verdict?
The first steps in the process are to build a coalition and seek its help in getting stakeholders onto the bus. Motivation is from the inside. People can be good soldiers if they are at least part of the process, so get them on board. If not, you are not going to be in the driver’s seat.
Robert Bjorklund is chair of management in the school of business at Woodbury University. Reach him at Robert.Bjorklund@woodbury.edu.