Good decision-making skills are essential for success in any business. However, making great decisions is what sets the real achievers apart. While some of these skills may come naturally to you, others may require some effort on your part.
Maybe you’re looking for a way to make better decisions, or perhaps you’re trying to figure out how to strengthen your company’s foundation. If you want to be among the high-performing business people, you need to learn how to make sound decisions and excel in key skills associated with decision-making.
By improving these skills, you’ll be in a much better position to make informed decisions and achieve success in both your professional and personal life. So, without further ado, let’s dive into what these skills are.
Substrata of Decision-Making Skills:
We all have a certain way we want to make decisions, and that’s the one thing you should never ignore. Your opinion does matter when it comes to how something will turn out for yourself or others in your life.
There are three factors approximately on which these decision-making skills depend (discussed later). Entrepreneurs either opt for graduate degrees or acquire raw knowledge through work experience to master these skills. However, it is much more feasible now to achieve degrees thanks to online programs. So, an entrepreneur may enroll in a masters in analytics online program while gaining experience from hard work simultaneously.
Let’s have a look at the three factors that govern decision-making skills:
Intuition (Gut Feeling)
Intuition is your gut feeling. It is the first reaction you give in the face of a problem or when you need to make a crucial decision. This comes from what you’ve learned and experienced and personal opinions – so everyone has different intuitions. Using intuition means that you’re basing your decision on what feels right, not some static list of rules.
When making a decision, your intuition is one of the factors that you should take into account. However, it’s not always best to rely solely on this guide because sometimes, our instincts lead us astray. We often make decisions based upon feelings or beliefs rather than facts-which can turn out disastrous if they’re wrong.
Reasoning provides another perspective by using data instead of going instinctually with whatever comes up in conversation (even though both approaches may seem valid). This would mean more objective ways for things like major life choices. However, reasoning still needs some guidance from experts.
Hybrid – Mixture of Both
We all make gut decisions from time to time, but you should never ignore the logic behind your intuition. It’s not just about making a decision; it’s also about the reasoning behind your gut feeling. The two most common ways people approach this task are intuition and reasoning-based thinking. Using only one of these methods can lead to bad decisions because either you didn’t check facts thoroughly enough or ignored other possible outcomes.
Making decisions is a skill that most people don’t possess. It takes reasoning, intuition and the ability to analyze potential outcomes.
Basic Understanding of Economics
Acquiring a basic understanding of economics can be a valuable asset to any company in the world, especially your own. It’s even more important if your business deals in anything with economic implications. In addition to understanding pricing strategies and market demand for goods or services, studying economics will give you insight into how decisions affect people who depend on them.
These may include vendors anticipating future contracts, laborers whose wages are negotiated regularly, and workweeks during peak seasons based on industry-wide agreements.
Negotiation is a necessary skill for any professional. The World Economic Forum identified it as one of ten skills everyone needs for a thriving career. However, bargaining is not just an activity reserved exclusively for salary negotiation. When dealing with investors or stakeholders, learning how to handle yourself can help you negotiate higher business development strategies.
A successful negotiation strategy is not one-size-fits-all. The key to effective negotiation for entrepreneurs is to remain open to improvisation. Think about what you might need if things go south to keep up your end of the bargain or win back the momentum from the other party.
Accounting and Financial Skills
Accounting is a subject that can be intimidating for some entrepreneurs. However, you will need some basic accounting and finance skills to thrive in the business world.
Being aware of your company’s financial strength and condition can be very beneficial in understanding the company’s performance and potential. The ability to read balance sheets will help you communicate financial results more effectively, which means you should not overlook nor underestimate this skill. Of course, you will hire accountants and financial experts in the future, but to make sure nothing goes wrong, you as an entrepreneur need to master these skills as well.
The next time you make decisions, consider the following questions to see if you have all of these skills. Do I use intuition? Am I good at reasoning and logic? Can I negotiate well with others and understand terms like liquidity and cashflows? If not, it may be worth your while to invest in some training and education. They can help improve those areas of weakness so that your decisions are better for your business and stakeholders.