Tips For Making Smarter Business Decisions was written for Playlouder by a contributing author. Please note that contributing opinions are that of the author. They are not always in strict alignment with our own opinions.
As an entrepreneur or business manager, your work probably revolves around making decisions. From setting the core values of your business to deciding the prices of your products and selecting the right success indicators, you must do it all!
All this decision-making can be extremely draining and lead to problems, especially if you're not making them the smart way. And what are smart decisions, you may ask? These are decisions made with a careful understanding of any given situation.
Such decisions yield maximum results and require minimum effort to make. No migraines, no lengthy board meetings, and no sleepless nights at the office required.
So how do you make smart business decisions? How do you work smarter instead of harder? Well, here are a few tips to help you out.
Use data analytics, tools, and software
Basing your decisions on data will save you from making harmful decisions that have the potential to tank your business. This evidence can be obtained through financial insights, key performance indicators, and management reports.
Thanks to the latest technology, all this information can be obtained through data collection tools and software that help gather insights into numbers and trends. You can make all your strategic decisions by thoroughly analyzing the insights and reports these tools provide.
Business tools and software give you a clear picture of your company's financial health. Thus, you will be in complete control and can identify the factors that drive your business from those that stunt its growth.
Moreover, you can set measurable goals, implement appropriate changes to reach these goals, and track the impact of each change easily using business tools.
Fortunately, hundreds of such tools and software are available on the internet. But hiring a professional data analyst or providing in-house resources with flexible learning opportunities to upskill, such as earning an MS statistics online, can help you build a competent decision-making team.
After deploying the correct tools and building the right team, you will gain clear viability of your business operations. This will offer valuable insights to transform decision-making from a difficult, head-scratching task to a considerably easier one. Knowing the entire state of play in minutes will allow you to make decisions instantly.
Set clear goals
The SMART model is your best friend for making decisions. It consists of several steps that help set goals and make the right decisions. Here is what each letter in the SMART model stands for:
So to sum it up, you should set a specific and clear goal. Next, you should determine ways to measure its progress and outline the steps necessary to achieve it. Lastly, ensure that the goal meets your company's core values and establish a clear deadline for it.
The SMART mentality will enable you to set your business's goals and objectives. The goals, in return, will give your business direction, aiding decision-making. Before making any decision, ask yourself two questions; how will this affect your goals? Will it take me closer to them or further away? The answer to these will help you make the right choice.
Focus on Improvements (and growth will come)
Getting too comfortable with your business strategies is detrimental to your company's success. Just because everything is operating smoothly in your business, it does’nt mean you shouldn’t change anything. Being too set in your ways can lead to business myopia and cause you to miss several growth opportunities. You may get stuck in a loop of stunted growth.
Often people say if you are not growing you are dying, but growth at all costs isn’t necessarily always good. Focusing on improving can be a better approach. You might also look at it as evolving.
When things are going well, pause and ask yourself, “How can I make things even better?” Such a mindset will allow you to be open and flexible. An improvement mindset will give you an outsider's perspective of your business.
It will widen your vision as you gain an objective view of your business operations, procedures, policies, and strategies. Thus, you can easily identify your limitations and foresee future industry changes and prepare for them from now! Moreover, you will also have a better understanding of ways to improve your business.
Leading with an open mindset will allow you to adapt to change, overcome challenges, and recognize new opportunities that can take your business to new levels of success.
Turn mistakes into learning opportunities
Studies have shown that 84 percent of small business owners and employees globally see making mistakes as an opportunity for growth. The small business owners surveyed reported experiencing an average of two unsuccessful ideas before finding one that worked
Every time you fail or make a mistake, learn from it and use it to grow as both; a person and an entrepreneur. Don't let these opportunities pass by! Carefully study your mistake and figure out the reason behind your failure. Then, take notes on how to avoid such an event in the future.
The decision-making process constantly teaches you to learn and grow. By incorporating lessons from past experiences, you can hone your business skills and become a smarter and better businessperson.
Create back-up plans
There is actually a lot of controversy around back up plans. Studies have indicated that having a “plan B” can sabotauge a “plan A”.
That may be true, but the reality is that things don't always go your way, and you'll probably have to change your plan to accommodate unforeseen changes. One of the most importan indicators of when you need to change course is when your data tells you you so. Yes that data you will be gathering from section one!
Sometimes your new direction is so significant, it could be described as a ‘pivot’. This refers to a business shifting its business model significantly to become a different company entirely.
In the ideal scenario, your smart decisions will lead to fruitful results. But on the off chance that something goes wrong, be sure to have a contingency plan you can rely on. After all, foreseeing every setback and roadblock is impossible! But with the proper research and knowledge, you can deal with such situations effortlessly.
Get help when needed
Managing a business is no piece of cake! It requires blood, sweat, tears, and a lot of time and effort. However, you may also need outside help, and you should not shy away from getting it.
Making each decision by yourself can be very stressful. Sometimes, a third-person perspective is required and may even be more beneficial. Family, friends, mentors, and other people in the business industry can give you unique ideas and solutions to business problems, and helpful advice that may aid you in getting out of a blind spot.
Furthermore, asking another person for help will give you an outside perspective. This may help you catch things that you weren't able to.
Intelligent and successful business people use every tool available to them. They also consider people part of their toolboxes and aren't afraid to ask them for help. Remember to repay your helper with a sweet token of appreciation because nothing comes free of cost! Not even advice.
A business decision can either make or break your company. So it's best to be smart about it. Just combine our tips with a little bit of experience, and you'll be making instant smart decisions that lead to success in no time. These decisions will yield better results and help your business grow faster.