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Entrepreneurs are classified as serial decision makers because they make numerous judgments every day, are wired to take risks, and aren’t scared to learn from their failures. Entrepreneurs and persons with strong “D” personalities typically make better decisions than people who are more risk averse.

For individuals who make judgments more naturally, you should concentrate on enhancing the quality of your decisions. When making difficult judgments, you should concentrate on following effective decision-making procedures and adopting tools to help you synthesize information. Then, rather than delaying, follow through on your decisions.

Experience, intuition, intelligence, awareness of the corporate environment, effective listening skills, and the capacity to respond when necessary are all required for making good decisions. Here are some business decision-making advice from entrepreneurs:

  • Understand your company’s business – make sure you have all of the critical information that impacts the business
  • Results oriented – think about the possible outcomes of your decision and understand how they impact both short and long-term company goals
  • 360 Feedback – get feedback from other departments, your manager, your peers, your accountability partner
  • Be Calm – if you are getting overwhelmed by all of the information, stop and take some deep breaths so you can once again focus on the decision at hand
  • Keep moving forward – focus on what is best for your company; don’t put off important decisions and don’t continuously worry about past mistakes
  • Continue improving – learn what went right and what went wrong and use that information as you make future decisions

According to a McKinsey & Company poll, only 20% of respondents believe their firms excel at decision-making. Despite this startling number, there are practical strategies for entrepreneurs to improve the quality of their decision-making process.

1. Consider your state of mind

There is a lot of pressure to move swiftly in today’s environment, and decision-making is no exception. It’s crucial to remember that we’re not always in the ideal mental or emotional condition to make judgments. If you are upset, terrified, or angry, you may make a hasty judgment that will have long-term unfavorable implications.

Read Also: How to be an Entrepreneur as an Engineer?

Take a moment to clear your mind if you feel your emotional state is amiss. Deep breathing, exercise, and meditation are excellent ways to improve your entire mental state and prepare you for decision-making.

2. Carefully evaluate the situation and data

The data in front of us may not necessarily tell the complete story. Making decisions based on insufficient information may lead to poor decisions. Take the time to properly assess the entire scenario. Be inquisitive and ask lots of questions to ensure you have all the information you need to make an informed decision.

When making judgments, data may be both your best friend and your worst enemy. Beware of information overload. According to one survey, 44% of participants found decision-making challenging owing to an abundance of data. You also don’t want to make a conclusion only based on quantitative facts. Other elements, such as human emotion, are more difficult to quantify.

3. Review your desired outcomes

Dr. Stephen Covey advises his readers in his best-selling book, The 7 Habits of Highly Effective People, to “begin with the end in mind.” When you know that your choices will get you one step closer to reaching your goals or strategic objectives, choosing decisions becomes much easier. Before making any decisions, consider your own goals or the mission statement of your organization. If the decision reaffirms your aims, it is an excellent indicator of the direction you should go.

4. Identify your blind spots

Blind spots are areas in which you lack appropriate abilities, information, or experience, which might have a negative impact on your decision-making. For example, deciding to merge with another company without a firm grasp of contract law could be disastrous. Request assistance from a friend or business partner in identifying your flaws or blind spots. Even better, join a peer board of business owners who are not competitors. This will allow you to proceed with greater caution the next time you have to make a decision involving one of your blind spots.

5. Include others in the decision-making process

While entrepreneurs and business owners are completely accountable for their companies’ success or failure, they do not have to make decisions on their own. In many circumstances, you can enlist the assistance of other specialists (such as senior management, human resources, attorneys, CPAs, and so on). Including others in the decision-making process can provide additional viewpoints you may not have considered.

6. Just make a decision

While it is vital to thoroughly analyze all possibilities before making a decision, inaction is frequently worse than making the wrong decision. You must make a choice one way or the other.

A solid method is to consider the worst-case scenario. If the worst-case scenario is something you can live with, you’ll at least feel sure that you can correct the issue if things don’t go as planned.

7. Communicate your decisions

Once a decision has been reached, it is critical to ensure that all affected parties are informed of the course of action. The manner in which you explain your decisions might have an impact on how they are accepted. Some means of delivery are superior to others. An email or memo will suffice for simple decisions. However, complex judgments that necessitate comprehensive explanations may be better delivered in person.

Knowing some frequent blunders before making judgments will help you avoid them during your process.

Decision-making is a skill that can be honed through practice, practice, and more practice. As you work on making great business decisions, ask your accountability partner and management for comments along the way.

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