One of the most important and difficult things you’ll have to do as an entrepreneur is make decisions, and lots of them. The average entrepreneur makes hundreds of decisions a day, and they aren’t all easy. From deciding whether to fire a client to figuring out which candidate to hire, decisions can be so difficult they become paralyzing. However, tough decisions sometimes have to be made. So how do you ensure you’re making the right decision? I find that using scenarios helps.
First, get yourself a blank piece of paper or open a blank document on your computer. Write down all of the things you know for sure about the decision. Label them “Facts”. A fact could be something like, “the client consistently pays 60 days late”, or “the candidate has a PhD in mathematics.”. Listing the facts will help you to determine the truth of the matter, without passing judgement. List all of the facts you can think of.
Next, make a list of assumptions. This is where creating a scenario helps. Let’s assume that you decide to fire the client. What are some of the consequences of this? You will lose that income, but it could increase your productivity if you don’t have to deal with a demanding client. If you decide to hire the candidate with the PhD, you may get some really great work, but you might have to pay them more. Making assumptions and weighing the consequences of various decisions is the best way to reach a decision more quickly.
Another thing to remember about making decisions – you need to be able to remove your personal feelings from the process. Getting caught up in bitterness towards the bad client or “falling for” a candidate simply because of their qualifications could lead to making hasty decisions. Take the time to really analyze the various scenarios and their consequences, regardless of how you personally feel about the situation.
Ultimately, you want to do what is best for your business, and making decisions that affect your business sometimes takes a lot of thought. Write out the facts. Create scenarios. Weigh the consequences. And don’t forget, sometimes talking to others can help. Find a trusted friend, associate, or partner to talk with about the decision. Getting that outside perspective can be immensely helpful too.
In the end, decisions are a necessary part of being a business owner. And it’s the decisions you make that will ultimately guide the business into different directions. So relax, take your time, and run the scenarios. You’ll make better decisions as a result.