Over the years, I have seen managers spend a great deal of time trying to make the right decision, only to discover later that they had been working on the wrong question.
You may have experienced this yourself. Sales decline, several customers complain about price, and almost immediately the discussion turns to discounts. An employee’s performance falls, and people begin debating whether that employee should be replaced. A project misses another deadline, and everyone wants to know who is responsible.
There is nothing unreasonable about these questions, but they can move us too quickly from a problem we have noticed to a solution we have already begun to assume.
When that happens, even careful analysis may not help very much. You can collect more data, compare alternatives and hold several meetings, yet still end up making a poor decision because the original question sent you in the wrong direction.
Start One Step Earlier
Suppose your sales have been falling for three months and customers are telling your salespeople that your product is too expensive. Reducing the price may eventually prove to be the right decision, but I would not begin there.
I would first want to know what has actually changed.
Are you receiving fewer qualified leads? Has a competitor introduced a stronger offer? Are customers buying differently? Has follow-up become weaker? Perhaps your salespeople are explaining the product well but are not helping customers understand why its value justifies the price.
Once you start exploring those possibilities, “How much should we reduce the price?” becomes a very different question. You may still decide to reduce it, but now that decision comes after understanding the problem rather than before it.
This is a small change in the way you think, but it can have a large effect on the quality of the decision that follows.
Be Careful When an Assumption Starts Sounding Like a Fact
A manager once tells you, “If we don’t promote our best employee, she’ll leave.”
Read that sentence again. What do you actually know?
Perhaps the employee has asked about promotion several times. Perhaps she has said that she wants more responsibility or that she is disappointed with her current opportunities. All of that may be true, but unless she has actually said that she intends to leave, part of the manager’s conclusion is still an assumption.
We all make assumptions because we rarely have complete information. The problem is not the assumption itself; the problem begins when we stop recognizing it as one.
When the consequences of a decision are significant, I find it useful to separate the two explicitly: What do I know, and what am I interpreting? Sometimes that simple distinction shows you exactly what you still need to find out.
Do You Really Have Only Two Choices?
Another pattern I have seen many times is the tendency to turn a difficult decision into a choice between A and B.
Imagine that you are considering opening a second business location. You can open it or decide not to. That appears to be the decision, until you ask whether those are really your only choices.
Could you test demand in the new area before committing to a long lease? Could you offer part of your service there temporarily? Could you begin on a smaller scale and expand only if the numbers justify it?
I am not suggesting that every decision has a clever third option. Sometimes you really do have to say yes or no. But when the consequences are substantial, it is worth spending a little time looking beyond the alternatives that first appeared on the table. A third possibility may not solve the problem completely, but it may allow you to learn something before making the larger commitment.
Know What Matters to You Before You Compare
Now imagine that three suppliers have submitted proposals to your company. One is cheaper, another has an excellent service record, and the third promises faster delivery.
Which one would you choose?
You cannot answer that intelligently until you decide what matters most in your situation. If one late delivery could stop production for two days, reliability may be worth far more than a modest saving. In another business, where delivery time is less critical and the suppliers are equally reliable, price may deserve much more weight.
I have found that many difficult decisions become clearer once the criteria are clear. Instead of allowing each option to impress you with its strongest feature, decide first what the decision needs to accomplish and then compare the alternatives against that.
Five Questions I Would Ask Before an Important Decision
You do not need a complicated model every time you have to make a decision. For many business and managerial situations, I would begin with five questions:
- What am I really deciding?
- What do I know, and what am I assuming?
- Have I considered another realistic alternative?
- What matters most in this particular decision?
- What could make the option I currently prefer fail?
I pay particular attention to the last question. Once we begin to like an option, it is easy to spend our energy proving why it should work. Asking what could make it fail forces us to look in the other direction for a moment, and sometimes that is where the missing information is waiting.
Then Make the Decision
Good decision making does not mean analyzing forever. I have seen decisions delayed long after additional information stopped adding anything useful.
A decision that is inexpensive and easy to reverse does not deserve the same amount of analysis as a major investment, a long-term contract, a dismissal, or something involving legal or safety consequences. The importance of the decision should influence the amount of time and information you invest in it.
At some point, you will still have uncertainty. That is normal. The purpose of a good decision process is not to remove every uncertainty, because in real life that is rarely possible.
What you can do is make sure that you understood the problem before trying to solve it, distinguished what you knew from what you assumed, looked beyond the first alternatives, and decided what really mattered. Then, when the time comes to act, you are not simply choosing between the options that happened to appear in front of you. You are making a decision based on a clearer understanding of the problem you actually need to solve.