Every entrepreneurial journey is one of learning and growing. Especially mine. I started our company, Acceleration Partners, in 2007, and though we've grown consistently over the past 13 years, I've made significant mistakes and learned plenty of lessons. Perhaps the most important one was how to make difficult decisions, especially ones that impact the entire company.
Decision-making is an indispensable business skill, and it becomes harder, not easier, the further you advance. If you grow into a leadership level in an organization, your decisions become more impactful as you climb higher. Likewise, if you are a founder of a rapidly growing business, your decisions become more complicated, nuanced, and high-stakes as your organization scales.
It's helpful to approach decisions with humility and recognize a need for data and expert guidance. However, every leader faces situations when a decision must be made quickly, without precedent or data. In those cases, decisive action is still needed and, as the past few months have shown, avoiding tough decisions inevitably only leads to harder ones. Here are three keys I have learned to make better decisions.
Rely on values
In the absence of data or expert opinions, the best course for both the short and the long terms is to make a decision aligned with your core values. Those values need to be both real and hierarchical. Relying on non-negotiable principles as a guide not only allows you to confidently make decisions with limited time and information, but also helps ensure you can stand by those choices in the long term.
There's extensive history of organizations making values-based decisions and excelling as a result. CVS lost $2 billion in sales when it decided to stop selling cigarettes, but it knew it couldn't credibly operate as a health care company while still selling such an unhealthy product. When Covid-19 hit and amplified the hazards of smoking, the decision looked even smarter.
At our organization, when Covid-19 changed the business world, we turned to our values. Specifically, we created six hierarchical principles based on our core values that we could use as a decision-making rubric to guide our most challenging decisions:
- adhere to our core values (own it, embrace relationships, excel and improve);
- survive the recession--control what we can control and make sure we are here to fight another day;
- be transparent and treat people with respect;
- do the most good for the most people (employment, well-being);
- move quickly and decisively; and
- keep the long term in focus.
I've learned that when you trust your personal and organizational core values, even the hardest decisions are ones that help advance your business in the long term. Clarify your principles, and let them guide your toughest choices.
Use speed when needed
When leading a team or organization, it's natural to want to make decisions through collaborative discussion and consensus building. However, every leader faces cases when it is necessary to act quickly and decisively, even if that means operating without complete information, or making decisions before clearly communicating with others. In these scenarios, it's important to accept extenuating circumstances and act decisively, and then communicate after the fact.
This is especially true in crisis situations, which often change constantly in a short period of time. In these cases, I found the aviation protocol of aviate, navigate, and communicate (ANC) instructive.
When pilots encounter dangerous conditions, they are trained to keep control of the aircraft--aviate--and navigate their immediate path before taking time to communicate with passengers about the situation. Operating in the opposite order could be deadly. Leaders must understand that while communication is vital, it is sometimes necessary to act first and explain your actions after the fact.
Once a decision is made, especially if it was settled with limited communication to stakeholders, it's essential to communicate the decision clearly and confidently.
Perhaps most important, any decision communication must focus on the reasoning behind the course of action. By explaining why you made a certain choice, and connecting that decision to the company's overarching goals and values, you can give employees, customers, and partners confidence in your chosen path.
In the wake of challenging times or difficult decisions, it's important to be vulnerable and honest with the people you lead and set proper expectations. A framework I have used extensively throughout the past few months was developed by Jim Collins: the Stockdale Paradox.
In his research, Collins found that when business leaders successfully led their companies through existential challenges with many tough decisions, they embraced a psychological duality: They recognized the brutal facts of the situation and shared them with their team, but remained steadfast in their belief in a long-term positive outcome.
I incorporated this into my own leadership during Covid-19 by increasing my communication frequency with our team to share information often and transparently. This included holding daily huddles with my leadership team, hosting weekly calls with our entire organization, and sending weekly video updates to the company over the first two months of the crisis.
My goal was to be honest about the uncertainty and adversity the company faced, while also helping the team keep focused on the long term and what they could control. I also wanted to make sure that the entire organization was made aware of the difficult decisions our team was making, and why we made them. This helped built trust in our organization and ensure that rumors or incorrect narratives didn't take hold.
Every entrepreneur I've met could tell you decision-making is foundational to the success of their organizations. By trusting values, acting decisively, and communicating effectively, leaders can consistently keep their organizations on track and choose courses they can stand by in the future.