Tuesday, 23 May 2017

How to make better decisions

The ability to make decisions – often, quickly and well – is an attribute that can boost your career in the tax profession.

When the going gets tough, people look to the best decision-makers for solutions to problems. It’s no coincidence that the people who make the best decisions are those most likely to end up in senior leadership positions.

It’s useful to remember, however, that effective decision-makers are made, not born. Decision-making is a skill that can be developed like any other.

Here are a few techniques.

Edit the information

You cannot read every item of written information or listen to every opinion that may support your decision-making process. Otherwise you’d spend all your time on research and very little on the decision itself.

You need a process for editing or filtering the available input through a hierarchy of information types.

At the top of this hierarchy are facts – those items of information that have been analysed, tested, validated and proven to be correct. Facts are knowledge.

What are the indisputable facts pertaining to the decision you need to make? These facts should take precedence over opinions, theories, beliefs and especially rants.

Visualise the outcomes

Every decision you make has consequences that can make a difference in the course of your life and the lives of others. It’s important for you to have a clear understanding of what these outcomes are likely to be.

What are the potential benefits to all stakeholders, especially in relation to likely costs? A rigorous cost/benefit analysis should help you assess whether costs can be contained within a reasonable limit and whether your decision is likely to achieve all the potential benefits.

Likewise, you should also evaluate the ratio between risks and rewards. What are the risks inherent in the decision you’re planning to make, and do the prospective rewards make it worthwhile to take these risks?

Consider the alternatives

As the old saying goes, ‘there’s more than one way to skin a cat’. Decision-making isn’t a binary exercise. There are usually many different ways to solve any problem.

Where possible, use creative brainstorming to layout the many different ideas, options or alternative approaches. You’ll find that, while some alternatives may favour one stakeholder group over others, there is always at least one that can deliver a win/win outcome for all parties.

Assess the ethical implications

Before making any decision, you need to be comfortable that it aligns with your highest personal and professional values.

Doing the right thing is always the right thing to do. Blurring the line between right and wrong may reap short-term benefits, but over time it will undermine your integrity and your reputation.

Use your intuition

While your gut instincts, alone, are not a sufficient basis upon which to make sound decisions, it’s also wise to not completely ignore your intuition. If a potential decision ‘just doesn’t feel right’, it probably isn’t.

As a final check, after you’ve applied all rational criteria to your decision-making process, always take your intuition into account.

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