Entrepreneurs are daily decision-makers. From the big decisions that have a large scale effect on your business to the little steps that determine your business’s day-to-day activities, decision making is a core part of running a successful business enterprise in Africa.
There are basic decision-making skills every business owner should possess and know how to use deftly. Business owners understand that every decision made is about risk evaluation and maximising available opportunities to achieve their business goals.
But how are these decisions made? How do you choose between selling your company for the best available offer and waiting out the dry season for the potential productive years coming? These are hard decisions, and certain skills are required in making these decisions.
Below are five decision-making skills every business owner should have and use when making critical business decisions.
The 5 Minute Rule
This is a decision making skill that helps you beat procrastination, as a business owner, stalling for a long time before making an important decision is a very usual thing. This causes an unhealthy delay and slows things down. The 5-minute rule is a decision making skill that helps you make decisions when you need to without entertaining overthinking and procrastination.
The rule states that when you need to make a decision, set a deadline for yourself even if there is none for the decision which is often true. Although it is important that these decisions are made early and quickly, there is no fixed duration for them, so it seems as though it’s all good if you decide tomorrow. And you keep postponing.
You can use the 5-minute rule by sitting down in front of a timer and setting the timer to 5 minutes, and once the countdown begins, you begin your brainstorming. This means you have only 5 minutes to decide what you want to do. This allows you to focus and think about the decision you have to make for that 5 minutes. Once the timer counts down, you make your decision.
This skill can be modified to fit your use. If you know you will need about ten minutes to brainstorm, then set your timer to ten minutes. The most important thing is that you stay focused for a certain period and think about the decision you have to make. And also, it helps you deal with overthinking and procrastination.
Comparative Risk Evaluation and Analysis
As said earlier, decision making is mostly about risk-taking. You weigh the options before you decide which is best for you and your business. To do this efficiently, you need to evaluate your risk and the consequences of your decisions. If you have two options to choose from, you have to evaluate the two options.
Being a business owner requires a lot of analytical and interpretive skills. You can draw out a table on paper and write the pros and cons of each option. You can also write down which of the options you think is best for your business now and in the future and write why you think so. By the time you do this while applying the five-minute rule, you can make an unbiased, intelligent decision.
The Outsider Approach
As a business owner, you cannot afford to make important business decisions based on emotions. Being the owner of the enterprise, this may be a tough decision to make. But if you want your business to thrive, you need to make decisions based on facts and figures considering profit and loss, not based on emotions and sentiments.
To do this, you need to sometimes step out of yourself and view your business as an outsider. This includes taking your personal beliefs and sentiment out of it and viewing the dilemma before you from a neutral outsider perspective and ask, “What would I do if I wasn’t emotional about this?” if you can take the outsider approach, you will see the things you could not see while thinking from the inside and that will help you to make better decisions for your business.
The Readiness to Fail
The final skill you need to have is the ability to accept failure. Understand that as a business owner, you will not always get it right. There will be times when you will not know what you are doing, and you will not know what decision to make, even after using all the skills above. This is the time to ‘just do it’ and understand that failing is also a part of success even if it does not work out well.
Leading a successful business can be hard. From embracing losses to sourcing for capital to managing growth and working towards expansion; it is a difficult task and involves a lot of decision making. As you learn these skills and put them to action, remember that a successful business is often a result of the right set of decisions, whether big or small.