Business Growth: Critical Thinking for Decision Making
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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowIn a recent interview, Virgin founder Richard Branson shared the primary criteria he takes into consideration when making a significant decision. While most business owners take several different approaches when they are identifying a problem and constructing a plausible solution, Branson favors a very simplistic solution that has obviously served him very well over the years.
He asks himself the questions, “Is this something my children and my grandchildren will be proud of?” and “Will it make the future a little bit brighter for the next generation?” While Branson is easily one of the most well known entrepreneurs of the 21st Century, his family is clearly at the forefront of his thought process.
Most business owners and managers utilize many different methods when it comes to critical thinking processes and making a decision. As your business grows, it is faced with more difficult and complex problems along the way. If your company cannot develop a solid approach for thinking critically to make decisions, your growth could be easily stymied. Realistically, when decisions are made, they end up being a good decision or a bad decision. There is not much in between. The objective of a great decision maker is to tip the percentage enough to make the right decision more than fifty percent of the time. Here are some practical thoughts to help you and your business do that very thing.
Zola, a wedding planning and registry company based in New York, has used what they call inclusive decision making for the last five years. Inc. Magazine published a recent article which explained the approach. Rachel Jarrett, the president of Zola said, “We want to make sure we are looking at something from all angles, and to make sure that no one person dominates the discussion.” Zola collects many different thoughts/opinions using a Post-It note system that is anonymous.
- Specifically, one of the middle or upper level management/department heads define the problem they are facing. There are anywhere from twelve to twenty people involved in the process.
- During the weekly management meeting, anywhere between two and four options or alternatives to solve the problem are presented. Each person in the meeting gets to cast their vote (sometimes anonymously).
- Each alternative is debated without any “finger-pointing or politics”. Time is devoted to diverse opinions, being certain that everyone is heard and is not interrupted.
- A final vote is taken after the debate.
- The person who brought the problem to the table gets to make the final decision. They are not required to yield to the majority of votes.
While it is far from a democratic process, “This is about giving the decision-maker the information to make a better decision — and to know we’ve taken the time to understand every perspective,” said General Manager Maya Simon.
Interestingly enough, when looking at this form of decision making, “Nine times out of ten, we see a drastic movement in the vote, and about eighty percent coalesce around the vote,” said Jarrett. “Usually it’s because a compelling argument has surfaced.”
It is critical for the growth of your business to identify and separate the really big decisions from the daily, even hourly ones, that have to be made in some form. Obviously, huge decisions require much more thought and deliberation. Smaller decisions, not so much, but they are still needing to be made and implemented on a regular basis. To help stratify the various types of decisions, McKinsey and Company created and developed four ways to approach making decisions. From big decisions to small ones, the McKinsey approach helps set the stage for actually developing a process for making sound decisions.
- ‘Big Bets, which are rare, high stakes, are made at the leadership level. This type of decision can be improved by practices that foster more productive, honest debate.
- Cross cutting decisions, which are frequent, often with high stakes and require collaboration. They are made at the business unit and senior manager level. These decisions require the implementation of a robust process, including clear objectives, targets and metrics are key to this type of decision.
- Delegated decisions, which are frequent with lower stakes and can be made at the individual or team level. These will be improved by ensuring commitment, not just consensus.
- Finally, ad hoc decisions, which are frequent and low stakes.’
The key for your business is to strive for continually improving your critical thinking and decision making processes for longer term growth.