A leader's daily decision checklist is daunting: From hiring or firing to major business changes, every judgment call carries with it some level of risk. A bad choice could result in a toxic hire or a new product launch that crashes and burns. Perhaps more frightening, one poor decision could scar a career forever (just ask former J.C. Penney CEO Ron Johnson). And so fear of negative implications leads us to delay important decisions -- or not make them at all.

We try to make more perfect decisions by gathering additional information. Great, except that amassing intel takes time, energy, and resources. And by the time you finally have perfect information, the world has changed and introduced new sources of ambiguity, thereby rendering all of that precious information totally irrelevant.

In the immortal words of RUSH, "If you choose not to decide, you still have made a choice." Failure to make a decision is almost as bad as making a bad decision -- and in some cases it's worse.

Define What's Certain, What's Predictable, and What's Unknown

Why do we fear ambiguity? Because lurking within is the possibility of making an incorrect decision. To better understand how much risk you're really assuming, break down the decision into factors that contribute to your unknown. Think of it as an equation, and you're solving for a set of missing variables.

As you break down the decision equation into component parts, you'll find some things are relatively certain (e.g., population growth), some have a spectrum of outcomes (like market share one year after product launch), and some things are completely uncertain (consumer reactions to an entirely new category of products). When you understand the major sources of ambiguity, you can better accept the true amount of risk you're assuming, and put measurement and mitigation plans in place.

Decision making is a simple process. You define the decision and the decision maker, calculate the risks, make the decision, then measure and adjust. Ambiguity is the source of decision-making risk. You should feel more comfortable making a decision when faced with less ambiguity and with more productive ways to account for the remaining things you can't predict.

Break Big Decisions into Smaller Ones

There's no need to make one, single huge decision. Product development folks know this very well. They break big product rollouts into smaller tests, focus groups, and concept tests. In doing so, they effectively strike a balance between gathering information, taking speedy action, and reducing ambiguity. You can do the same thing with your decision making.

Imagine you're hiring someone to fill a critical role on your team. The longer you delay the hire, the more work goes undone and the greater the chances you're missing out on key talent. Break that hiring decision into smaller ones. Find a good candidate and hire her as a consultant for a few months. You're still making a decision and advancing the business while at the same time gathering risk-mitigating information about the person's performance and cultural fit.

You Can Hit the "Undo" Button

We tell ourselves that big decisions can't be undone. This is our pride talking -- not practicality. Undoing a decision requires us to admit we did something wrong. Many of us would rather continue down the wrong path than publicly say we made a mistake. That's simply an absence of leadership.

Many decisions can be reversed. Swallow your pride, tell people you're changing course, explain why, and figure out what you learned from the incorrect decision. You might feel dumb for having made the wrong call, but it's better than looking like a colossal idiot for continuing down the wrong path even after you and others know you made a bad decision.

Balance Risk with Speed

In the end, every decision represents a tradeoff between speed and risk.

Going too fast doesn't allow you to gather information sufficient for an educated decision. Slowly amassing information in lieu of making a decision introduces opportunity costs and new sources of ambiguity and risk. If you're deliberate in your decision-making process and understand these tradeoffs explicitly, you'll be able to make better decisions faster and with less fear of being wrong.