Making Decisions: Eliminating Risk and Uncertainty
As business leaders, it’s our #1 job to make decisions. We want to make decisions quickly, but also in a way that eliminates risk and gets our team on board with the final decision.
In our last message, we talked about how using “gut instinct” worked fine for decisions we have made a million times, but when we’re entering into new territory, or when the landscape has changed, we might need to slow down, look at facts, and get feedback from our team.
Once we’ve gathered the facts and opinions, it’s time to think about how we can eliminate risk!
Purposefully Eliminate Risk and Uncertainty
As I’m framing a decision, there are usually one or two places where there is no useful data or the data doesn’t point in a clear direction. Where there’s uncertainty there is risk – so I’ve come to be very wary of uncertainty.
Is there a way to test a solution that might produce meaningful data? Could you run a pilot program, test in just one area? Can you experiment in a way that would yield more information?
Are there other people (friendly competitors, network partners, etc.) who might have some data that they can share?
Going back to the decision about hiring a new Account Manager, I might think:
Customer A seems very wary of changes in their account team, they’ve dropped some hints in the past that they feel like we don’t know their business well enough and a change in account team might trigger that again… Could we sit down with that customer and discuss their concerns (without mentioning any possible changes)? Could we add someone to the team without changing who they work with?…
I want to attack the riskiest part of the decision first because if it’s going to fail, I want it to fail quickly before we’ve spent a lot of time and money on a bad decision.
How could we experiment, test drive, or pilot the new way of doing things? Who else has been down this road that we could learn from?
Commit & Communicate
Once you’ve looked at the available data, listened to the opinion of others, and eliminated any uncertainty through testing, experimentation, or exploration, it’s time to decide.
At this point you might not have a clear cut winner. The data, opinions, and risk may point to risks and opportunities on both sides. This is why you get the big bucks! It’s time to make a clear decision, and explain to your team why you are making this decision.
We have bring on an average of 3 net new clients a year, we don’t see that changing this year. Our account team is near total capacity (based on their time sheets) and our clients have reported that they feel like we’ve made some mistakes recently. Based on that, we feel like we need to add at least one junior person to our team and will start recruiting right away. Hiring a junior person enables us to leave the relationships intact while giving our account managers more support.
Organizations usually resist change — so if you want the team to make a change you need to be clear and demonstrate commitment to the new direction to overcome that natural resistance.
How have you used experimentation, and testing to reduce risks in your business decisions?