The CEO’s Conundrum: Decision-Making Under Pressure

“Whenever you see a successful business, someone once made a courageous decision.” Peter. F. Drucker

The realm of decision-making can be fraught with many challenges. The delicate balance between risk and reward in the decision-making process can be perplexing for many CEOs and can lead to many a sleepless night. Every choice has a consequence, and knowing when to take risks and how to avoid reckless choices can make or break careers.

When the stakes are high, as a business leader, you can easily get trapped in a cycle of overthinking and indecisiveness, otherwise known as ‘analysis paralysis.’ You can spend endless hours researching and analysing available data. However, when you face a high level of ambiguity, how can you keep moving forward? How can you adopt a forward-thinking mentality to drive your company towards achieving its full potential in the face of uncertainty?

Acting decisively while taking the complexities of each decision into account is critical. It is wise to think through options before making decisions. However, when the data always feels insufficient and time is not on your side, what course of action can you follow? The quest to gain more information might feel like forward movement, when realistically, it is simply a delay tactic. In high-velocity environments, decision-making speed may be instrumental in differentiating between high and low performers; fast decision makers outperform slow decision-makers. Improving the speed and quality of strategic decisions is therefore essential for high performance and survival.

It takes courage to take a stand knowing you will not be able to predict the success or failure of your decisions until the outcome becomes publicly evident. It is important to recognize that bold decisions are a natural breeding ground for doubt and to allow room for that discomfort. Although ambiguity can be uncomfortable, it may force you to consider unexplored avenues and find hidden opportunities. The following tips will help to ease this process and circumvent these paralyses:

Develop real-time systems

Evidence-based decisions are only possible when data is collected and disseminated in a timely and efficient manner. Not embracing digital technologies can result in significant business opportunity costs. Sophisticated digital computing tools, platforms and infrastructure can enable business leaders to be able to access up-to-the-minute intelligence that can inform decision-making. Relying on historical data has become out-dated. Being ‘always-on’ is no longer just a nice to have – it is a business imperative. This will help reduce paralysis and speed up the decision-making process.

Practice inclusive leadership

Autocratic leadership styles are rarely effective in today’s fast-paced, complex world. Decision-makers can practice seeking out knowledgeable advisors and stakeholders to participate in the process. Inclusive decision-making activates diversity to improve innovation, engagement, and results across the enterprise. Decision-making authority is a tangible example of how power flows in an organization. The more implicit and opaque decision-making processes become, the less engaged employees become. A useful technique that you can employ is to host a ‘reaction round.’ Before making a decision, use a simple reaction round to hear all voices which encourages diverse views to be aired.

Create a psychologically safe space for people to raise any doubts or challenge the status quo. Stephen Covey advocated the ‘seek to understand before being understood’ approach. The goal at the end of the day is to make the best decision. Practice open-mindedness and allow yourself to be exposed to different viewpoints. Leveraging the thinking of diverse groups for smarter ideation and decision-making reduces the risk of being blind-sided. Highly-inclusive leaders are humble and open to learning from criticism and seeking contributions from others to overcome their own roadblocks.

Practice progress over perfectionism

Perfectionists are motivated to make the absolute best choice – which is a recipe for decision paralysis. If you have perfectionist tendencies, you will tend to judge and measure yourself by what was not accomplished, rather than what was. Procrastination, the close cousin of perfectionism, can also add to your indecision. High achievers are prone to this pattern of behaviour. As a leadership trait it is disempowering and corrosive. Set the goal of making progress rather than achieving perfection. Smart decisions are about timeliness and timeliness is more important than perfection.

Focus on smaller decisions first

Judge the value of each decision. Avoid using extensive amounts of time on smaller decisions that have less impact on the organization. Keeping each decision in perspective can help you to become more flexible. By getting the smaller decisions out of the way, you can free up your head-space to focus on high-impact decisions. It can also help you build momentum and confidence that will help you tackle those ‘tough-calls.’

Furthermore, by building a culture of accountability and quality decision-making throughout your organization can help you and your executives to make fewer decisions. The old command-and control style of leadership must give way to a shared, inclusive approach. One which promotes training employees to use their expertise and judgement to optimize decisions.

Combine logic with emotion

Intuitive decision-making versus reliance on data is hotly debated. Are emotionally-charged decisions better than dispassionate, logical ones? Research has shown that combining logic (data/analytics) and emotion (gut-feel) can lead to better decision-making. Everyone has had that gut instinct kick in that has warned them that all may not be what it seems. Heart-brain communication is a dynamic, two-way conversation. Some scientists have even posited that decisions are really made at the heart level and are then justified with logical thinking. When you become better attuned to naming and understanding your emotions, you can tap into this knowledge to improve your decision-making skills. Emotional fortitude is the art of examining your own thoughts and feelings regarding a decision and factoring them into the decision-making process. When you become adept at understanding where your emotional cues originated, you will be able to explain your decisions better, experience greater comfort with the decision-making process, identify any biases and avoid snap judgements.

The CEO’s job is like no other in an organization: it is infinite. The CEO is ultimately responsible for the company’s success or failure. As a CEO you must be able to make valuable judgments, nurture your team’s decision-making abilities and drive the business forward by making decisions that are aligned to your company’s vision and strategy. The process of decision-making can be refined and iterated over time. Courage requires the ability to act despite fears and doubts. The lack of executive courage can have destructive, ripple effects on an organization. Allow courage to propel you forward. After all, making easy decisions generally does not move the needle – making the tough ones will enable you to ascend to new heights of impact and influence.

Article by Shailja Sharma, Executive Fellow and Coach

The Global CEO Programme is delivered by Strathmore University Business School together with Yale School of Management and Lagos Business School.

The programme has been designed and developed to enhance your strategic vision and equip you with new tools to better navigate disruptive trends that could impact your business.