July 6, 2022

Decision Making in Leadership: How to Make the Best Choices, Every Time

Decision Making in Leadership

It should come as no surprise that decision making is one of the most essential skills for a leader. Regardless of the industry, size, and scope of your business, if you are a team leader, manager, or C-level executive, developing and nurturing your ability to make prompt, informed, and effective decisions can help your business thrive.

Nonetheless, making the right choices at the right time is often easier said than done. If you are interested in finding out more about decision making in leadership – including how you can get ahead of the game each time – then keep reading our guide right here.

The Importance of Decision Making in Leadership

As a leader, you are constantly faced with choices. Which project should you prioritize this month? Which client needs more nurturing and support from your sales department? Which team member should receive public praise, and which one should be assisted throughout their development?

The list can potentially go on, almost endlessly. Making decisions is the bread and butter of being a leader, but this doesn’t mean that every leader handles this in the best possible way. With efficient decision making, however, leaders can identify the potential solutions to problems and challenges, and make choices that will go on to benefit the entire organization – and strengthen their credibility and reputation as a leader.

Without clear, sensible, and rational decisions, leaders can struggle to provide the guidance, support, and empowerment that their team needs, thus hindering the company’s ability to better serve its clients and compete more fiercely with its rivals.

Decision Making and Problem Solving

When discussing decision making in leadership, many of us can easily get confused and think about problem solving. While problem solving is not the same as decision making, it is undoubtedly, another interrelated skill for a leader to master.

To begin with, problem solving is another crucial ability to develop and refine as a leader. Nonetheless, problem solving only works if the underlying decision-making method is solid and effective.

In a way, we can think about problem solving as the last step in the decision-making process. During this phase, the choices that a leader has made previously will get finalized and take a more “tangible” shape and substance.

A well-thought-out decision-making process, in fact, can speed up the resolution of problems and challenges, as well as find better and more efficient solutions to them. As a result, the returns on investments on time, money, and other resources are much faster.

How Can You Improve Decision Making in Leadership?

Leaders around the globe use many different types of approaches to their decision making, but one of the preferred methods seems to be the so-called DMAIC method. DMAIC stands for Define, Measure, Analyze, Improve, Control, and it aims to help leaders define what, exactly, needs to be fixed or improved, as well as identify what is currently working well.

Let’s take a closer look at each of the five steps of the DMAIC roadmap below. 

1. Define

First of all, it’s essential that a leader defines the initial problem, challenge, or goal that they want to accomplish. To do so, it’s important to be as specific as possible, as this will help leaders with the following steps of the DMAIC method.

Steer clear of vague statements, such as “Sales have dropped”, and try to be as precise as you can, including any figures of number whenever possible, such as: “The sales of product X have dropped by XX% in the second quarter, compared to the same period last year.”

2. Measure

Now, you are ready to move on with the second step: quantifying your problem. Using our previous example, you might want to measure further aspects of the problem, such as the exact sales numbers compared to the previous year, or the specific months when sales dropped significantly.

By doing so, you will collect more accurate and reliable information that, ultimately, enables you to move on to the third step of the DMAIC roadmap – and closer to making a decision that truly benefits your organization.

3. Analyze

With all this data in your hands, you can finally proceed with a crucial step: analysis. Now it’s time to look at all the information that you have collected, and determine whether the problem you are faced with is something that you – and your team – can resolve. 

In the case of our previous example, it sounds like the drop in sales of a previously popular product might have some specific causes that you can intervene on. For example, look at any price increases, or consider whether a competitor has recently launched a very similar product at a more convenient price point. 

4. Improve

This fourth step can also be seen as the “action” phase. At this point, you have numbers, data, and insights from your analysis, all of which can help you take some tangible action to fix your problem.

Let’s assume, for example, that your analysis has identified a specific issue, such as the launch of a more convenient competitor’s product. In this case, you might decide to invest in more marketing to re-promote your own product, as well as advertise a series of deals and discounts to entice your customers to buy from you as opposed to from your rivals.

5. Control

This last phase requires that you schedule a specific time to assess your decision making. During this allotted time, you will need to take new control measurements to verify whether or not your improvements have worked.

Depending on your project, control measurements can be scheduled on a monthly, quarterly, or yearly basis. Remember to keep documenting all your findings in a clear, up-to-date way, and to share them with any relevant team member.

Take Your Decision Making in Leadership to the Next Level

Decision making in leadership is one of the most important features that enable you to succeed as a leader, as well as your company to thrive. At Impro, we support leaders to develop their analytical decision making skills leveraging our data-driven coaching and consulting platform. Learn more about us and how we can help you boost your decision making in leadership.

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