Bearing in mind the traps that can be made by any business manager, you become a more effective business decisions maker.
A few years ago experts came up with a great idea to take over the leadership they thought would be worthwhile and bring success to everyone. They investigated the fact that, when people go to courses and self-development programs, their success dramatically increases because there is constantly encourage there.
An application was developed that could offer such kind of encouragement. People could enter into it, type their development goals, and magic happens. The software would send them reminders every week or month and ask them how they worked. Therefore, the application is motivating them to maintain continuity of work. A lot of time and money have been invested in this product. It turned out, however, that people did not want to receive e-mails and were more nervous than filling their motivating role for them.
Needless to say, this product did not achieve the potential it was supposed to achieve. When the authors of the application reflected on the decisions they made to create this disappointing result, the following, inevitable question was posed: “What is the reason for good-minded people to make bad decisions?“
People make bad decisions when they are under heavy pressure or when they do not have access to all important information. In an effort to understand the cause of poor decision-making, 360 feedback information from more than 50,000 business leaders was studied and compared the behavior of those who thought to make bad decisions with those who think they make very good business decisions.
Read more about habits: Habits of successful people are one step closer to you – 5 simple tips 4 you
An analysis of behavioral factors was made that showed the statistical difference between the best and the worst decision-makers.
We will present you a couple of reasons for making bad business decisions
It refers to the failure of checking the facts, taking the initiative, confirming the assumptions. Basically, such people are considered to be untidy in their work and do not want to further prove themselves. They call upon past experiences and the expected results are simply the essence of the past for them.
2. Waiting for sudden events to happen
It is discouraging to continually consider the possibility of negative events in our lives. Most people assume that the worst will not happen. Unfortunately, bad things happen quite often. One study shows that if people just take the time to think about what could go wrong, they actually become very good in anticipating the problem. But many people become so excited about the business decisions that you can never take the time to make that simple step.
When confronted with complex business decisions based on constant data change, it is easy to continue to study data. Or check reports, or perform further analysis before a decision is made. When reports and analyzes take much longer than expected, bad decision makers begin to delay everything and thus miss the opportunity.
You need the courage to look at the data, consider the consequences responsibly, and then you go ahead. Often the indignation of the mountains is from making the wrong decision. Those who fear can literally paralyze believe that one mistake is enough to ruin their careers and, without hesitation, avoid the risk completely.
4. Staying locked in the past
Some people make bad business decisions because they use processes that have been used for a long time. Such people are accustomed to the approaches they worked in the past and think that new approaches and ways should not be sought. But, too often, when a decision is about to go wrong, it’s because the old process is based on assumptions that are no longer valid and outdated.
5. The impossibility of a strategic settlement
Bad decisions sometimes arise from the impossibility of merging problems with the overall strategy. In the absence of a clear strategy that provides a context, many solutions seem meaningful. When there is a firm connection with a clear strategy, quality and good solutions come by themselves.
6. Dependency on others
Some decisions have never been made because one person is waiting for the other, and the other is waiting for a third person and thus a vicious circle. Effective business decision makers will find a way to act independently when needed.
Some business executives are waiting for the information to come to them. They are not taking steps to get them on time or to establish relationships that will allow them to get on to someone else’s expertise when needed. All research on effective decision making recognizes that involving others with relevant knowledge, experience and expertise improves decision quality. Also, many do not want to involve others because they want to take all the credit and praise themselves.
8. Lack of technical depth
9. The failure of communication-related to their decisions
Sometimes good decisions make bad decisions because people do not understand or even know about them. Communication about decisions and what they bring with it is crucial for its successful implementation.
Long waiting for information and approval of other colleagues, insufficient skills, and misunderstanding of new ways and methods of work due to over-reliance on the past, making decisions without consulting others are just some of the reasons for making bad business decisions.