The 5-Step Decision Making Process for Better Business Decisions

Your ability to make decisions, both right and wrong, will hugely impact your business. As a business owner, you will be faced with a range of decisions to make every single day. This onslaught can oftentimes feel relentless. But in reality, you still need to make the tough decisions alongside the easy ones.

Making good decisions to better your business is a skill that is learned, many times through trial and error and by making the wrong choices, but knowing how to approach the decision-making process can help to understand the impact of your decisions and why you are choosing this direction over the other ones available to you.

To make more informed decisions, you need to break things down to help you reduce second-guessing, follow your roadmap, and make the progress you need to without negatively impacting the company.

The first step in any decision-making process should be identifying the end goal. Why are you making this decision? What is the problem that needs to be solved, and why does it need to be solved? If you know the reason behind why the decision needs to be made and the problem it is addressing, then you can make better decisions.

Once you have clarified the above point, you need to gather all the information you have on the subject to allow you to make a more informed decision. You should never go in with your eyes closed, and you should be utilizing all of the software available to you and the data present on the problem.

From here, you should use tools available to you, such as https://mosimtec.com/digital-twin-simulation/, to help you see the bigger picture, run through different scenarios, and better understand the impact different outcomes will have going forward. At this point, you should allow yourself to really explore the possibilities, even if they seem outlandish or ridiculous, and you would never choose that option because this can let you see what you are trying to avoid and how the decision you make will affect what you are trying to do.

Gather your resources, take your time exploring what is going to happen, and use every ounce of information you can to justify the decision.

Once you have a theoretical decision in mind, you need to explore the consequences of the decision. While making a decision based upon all the information you have is vital, so too is understanding how it will impact others, From yourself to your employees, your suppliers, the market and so on. Look at the ripple effect this decision will make and what you can expect to see once it has been finalized.

This allows you to weigh up the pros and cons of each decision carefully so you are aware of the projected outcome and can deal with the repercussions effectively. It might be that the only way forward is to make the right decision for the company that ruffles a few feathers, i.e., you move your location to a new state, thus impacting your employee's ability to move with you, rendering them unemployed, or it could be that your decision to automate certain aspects reduces the need for employees resulting in reduced hours. Both of these situations will have negative consequences for others while benefiting the business, so addressing what will happen once things are rolled out can help you to be more at ease about what happens next or put a plan in place to deal with any fallout or disruption.

Now, it's time to make that decision. You need to rip the bandaid off and ensure it is executed thoroughly. This is the part that causes anxiety, especially for the decisions larger than usual or more complex than you have ever had to deal with.
But the reality is if there is a decision to make, you cannot ruminate on it forever. You need to make a decision either way before it becomes too late, and you miss your window of opportunity and have to start all over again.

If you are nervous about making the decision, ask yourself how you feel now about it, how you think you will feel once it has been carried out, and what led you to this point. Be confident and do it. Then, you can begin to move forward.

Once the decision has been made, it isn't a case of a job done and leaving it alone. You need to evaluate all of the effects of your decision, how you handled the issue, and whether what followed meets your expectations or where things are still chaotic and aspects overlooked.

Check what is and isn't working, if any new, unanticipated issues have been brought to light, the length of time taken to get things moving, and the level of satisfaction from everyone involved.

This is the stage in the process where any issues will arise. These issues can be not identifying the problem or solving minor matters, not the leading cause itself. Or it could be that you have had too many sources influencing your decision and haven't been able to see the wood for the trees, so you can't go with your gut, or it being a case of bad timing where you took too long to execute the decision, or you jumped too soon, and you didn't weigh up the importance of timing when to move ahead.