However well-intentioned, humans are notoriously bad at decision making. In fact, the conventional wisdom to “go with your gut” will lead you astray over 50% of the time. 

For business owners, the conga line of decisions to be made never stops. While many of these decisions are seemingly small, many of them matter...sometimes they matter a LOT.

This is why Decision Making is one of the three key skills and systems we work on with all CFO on Speed Dial clients. (See 3 Systems to Fast Track Business Growth and Boost Finances for more on all three systems!)

What will a business decision-making process actually DO for your business? 

When you are growing, companies are constantly moving into new territory. As a result, you are almost always having to react to information, situations and choices you haven’t faced before. 

This growth is great and EXCITING, but it can also be overwhelming and challenging — especially when you have crucial choices to make for your business.

But if you take time to create and then focus on a process by which you can take in and analyze all of this new information when it comes to your decision making, you will...

• Become more efficient,

• Reduce your risks, and, over time

• Consistently make better decisions - which will improve both the confidence in your decisions and the impact of them.  

Another advantage of having a clear decision-making process in your business?

Once your team understands the business decision process, they can be empowered and authorized to make more decisions; thereby removing the demand on your time and attention. 

Finally, a key reason you need a clear decision-making process is that, otherwise, you’re relying on stale information, incorrect data, and unreliable gut instincts to make choices that are likely to give you less-than-stellar results. 

7 Step decision-making process for your business

While the exact process will (and should) vary from one business to another, the key steps in any decision-making system must include the 7 simple (or complicated) steps: 

1. Define the problem or obstacle you need to resolve --  establish the focus for the decision process.

2. Clearly state the outcome you want  -  be specific.

3. Identify possible solutions - be creative!

4. Gathering data about each option - be rigorous.

5. Understand the risks of each one - Look into the future, and ask “what could go wrong?”

6. Choose and commit - Document the decision and your reasons for choosing that path.

7. Evaluate both the business decision process and the results of the decision.

Your decision-making process will continue to evolve and become even stronger when you take time to reflect on the decisions you’ve already made.

Of course, not all decisions are created equal.

Use your decision framework with high-impact crossroads decisions

Yes, you make a lot of decisions!

Psychologists estimate that we each make about 2,000 decisions an hour!  (Psychology Today)  Most of these are relatively small decisions — what to wear, when to eat, what to focus on next.

Good news: you don’t have to use this detailed process for every single decision you make. 

Using this 7-step decision process may seem complicated, but having a routine for making decisions actually makes big decisions simpler and cleaner. 

Focus your decision-making process on crossroads decisions.

Crossroads decisions are ones with a strong impact on your business growth, culture, and strategy. They define how your company will develop.

Crossroads decisions come from a challenge, constraint, or opportunity that, once you solve them, will make a significant change in your business...hopefully for the better.

These challenges, constraints, and opportunities usually relate to growth or expansion; or overcoming an external issue (as we all learned last year in the Covid shutdowns!). 

A crossroad decision could be as simple as adding a new position to your team, or it could be much more complex and have many questions embedded within it. For instance, if you have a big customer requesting a new product, you’re simultaneously considering customer relationships, brand identity, costs & pricing, and production capacity.  

Another way to define a crossroads decision is how many people will be impacted by the decision and whether the decision is reversible. If a decision is easily reversed or has limited impact then making a decision quickly and moving on is probably the right choice. For decisions with a broad impact on many people, slow down and take the time to fully evaluate your options.

Where can you find more help and support in establishing a system for your crossroads decision-making?

I’m glad you asked! Because it’s right here!

I am about to launch a new round of our Meaningful Money group program for women-owned businesses.

I’d love for you to join our crew of incredible business owners seeking to increase their profits AND to make a powerful impact in this world. 

If you’re ready to get the skills and systems you need to quickly adapt and grow your business along with the amazing support and accountability you need along the way, this is the place for you!

Find all the details and apply to Meaningful Money. 

PS: The first step in the process is a 30-minute meeting with our founder, Christine Rico so you have nothing to lose and possibly 30 minutes of strategic insight to gain by applying!