As a leader, the ability to make sound, informed, and beneficial decisions is your fundamental job requirement. You may consider yourself a good decision-maker, but you can always optimize the process further. To make better decisions:

  • Address your overconfidence
  • Apply probabilistic thinking
  • Improve the accuracy of your predictions
  • Explore alternative decisions
  • Be aware of your personal biases
  • Limit your choices

Optimal decision-making is essential at every level of your organization. 

Decision-making is the bread and butter of leadership. As the leader of an organization, you have to consistently deliver decisions aligned with its purpose, values, and goals. No matter how strong your decision-making skills are, there is always room for improvement.

In my leadership development books, I have identified a selection of leadership competencies that predict good decision-making skills. Such competencies/abilities are:

  • Analytical and critical thinking
  • Flexibility and problem-solving abilities
  • Good time management
  • Being a team player
  • Being able to listen actively and compromise when needed

How can you continue sharpening these abilities to deliver the best choices based on information assessment for your organization?

1. Curb Your Overconfidence

Overconfidence is a widespread phenomenon among male leaders, although women may suffer from it as well. The problem is that the overconfident seldom realize that they should be less secure in their decision-making.

The first step to overcoming the issue of too much confidence is to accept that you may be overconfident. This realization should give you enough clarity of thought to revisit your decisions from a more pristine logical perspective.

2. Apply Probability to Your Decision-making

The best way to defeat your overconfidence is to apply some probabilistic thinking to your decision-making. Probabilistic thinkers are aware of all possible events and prepared to change their thinking if one of them occurs. Learning to think this way may take a bit of extra effort, but science shows that probabilistic thinkers are better forecasters and decision-makers overall.

Subjective risk perception is inaccurate and leads to poor decisions. Psychological factors influence risk perception directly, making people risk-averse in winning situations and more likely to assume risk in losing circumstances.

There will always be a psychological element involved in decision-making, but mixing it with a bit of probabilistic thinking can create much-needed clarity.

3. Improve Your Predictions Through Objectivity

Your ability to predict outcomes plays an important role in your decision-making. Subjective predictions are so distorted that they wouldn’t even qualify as ballpark estimates.

To lend your predictions some accuracy, turn to objectivity. Access data regarding the typical outcomes of events you are trying to predict and how these outcomes unfold. Ask yourself: “How does that typically happen?”

The specifics of the situation and your psychological baggage create subjectivity. Subjectivity clouds judgment. By sparing a thought on how likely something is to happen in a certain way in the real world, you distance yourself from subjectivity.

4. Explore Alternative Decisions

Even when you feel fairly certain about a decision, it doesn’t hurt to rise above the minutiae of your analysis and explore a different approach.

The most efficient way to accomplish this is by designating an antagonist. The mission of this alternative decision-maker is to overturn your decision. Antagonists don’t have to come up with better decisions; they merely have to create alternatives that help you see your decision in a different light.

5. Become Aware of Your Biases 

Many leaders are proud of their intuition-based decision-making skills. While relying on intuition is fine up to a point, abusing this shortcut will allow your personal biases to affect your decisions.

Your biases can ruin your decisions.

If you are aware of your biases, you can keep them in check through self-reflection.

6. Limit Your Choices

Leaving all possible choices on the table can be mentally debilitating when making a decision. Your first step toward a decision is to limit your choices to a handful that you can thoroughly analyze and handle.

Having a handful of options to consider will help you make more informed decisions. At the same time, you will optimize your decision-making by focusing your abilities on what matters.

Top decision-makers have to be in good shape mentally and physically. Don’t neglect your physical health. Take a break to prevent burnout, and practice making smaller, less significant decisions every day.

The rules of decision-making are the same for small and big decisions. Turn following these rules into a habit, and you will find it easier than ever to make better, more informed, and objective decisions.


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