A Leader's Guide to Decision-Making: How to Make the Best Possible Decision?

Lori Li
8 min read
Aug 27, 2020


Decision-making requires you to acknowledge the situation at hand, gather enough information to make an educated decision, consider alternatives, think about the consequences of the decision, and — in the end — take action.

Leading a team requires you to make tough decisions while treating your employees with empathy. 

Of course, this isn’t easy. But to increase the likelihood you succeed, we’ll lead you through the process. But before we do that, we need to first take a look at some of the more common problems associated with decision-making. 

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The three most common problems with decision-making

Decision-making is quite challenging for both new and experienced leaders, but for different reasons. No matter how long someone’s been a leader, the following problems can throw a wrench into their decision-making capabilities.

1. Asking the wrong question

Both new and experienced leaders are prone to ask the wrong question from time to time.

Successful decision-making is all about framing the problem in the right way so that it can be solved. But the first step is actually identifying the problem correctly, and that starts with asking the right question. 

When you misidentify the problem, bad things happen. On the other hand, when you ask the right questions, you will get to the roots of the problem — which makes it easier to pinpoint what a potential solution might be.

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As an example, imagine a team member’s productivity plummets for two weeks. This wouldn’t be an issue about how to raise productivity. It’s more about what happened that caused the team member to stop being as productive.

When you figure out why the worker’s productivity trailed off, you can identify the cause for the decrease in output and devise a remedy to solve it.


2. Information overload

Information overload is something that many new managers struggle with. When you’re new at leading a team, you usually want to know all the information regarding a problem so you can make the best decision. 

Unfortunately, this can cause analysis paralysis, as the manager has too much information on hand, which prevents them from making a decision — or at least from making the best decision.

The good news is that information overload can be solved. You just need to implement a process that leads to a decision and then follow that exact process for the decisions you will need to make. 

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An example would be “The 5 Ws” in journalism. The 5 Ws stand for Who, What, When, Where, and Why. These are the five fundamental things a journalist needs to know if they want to write a good story. 

The same process can be applied to your managerial role, but, of course, you need to create your own inquiry system that would help you discard the unnecessary information and help you retain the necessary ones. 

3. Not having enough information

This is something that usually happens to experienced leaders. They become overconfident with their decision-making skills that they no longer follow the process that enables them to actually make good decisions. 

But there is a second issue here — something called regression to the mean

Regression to the mean is a phenomenon that arises when a sample of a certain variable is extreme. For example, if you see new team members either doing really well or really poorly on something, you will probably become biased toward them in a way where you expect that same behavior to continue in the future. 

But regression to the mean tells us that the future sample will be closer to the mean. That means if Sally did one task horribly and you saw it, she will probably do way better on the next task. 

If you’re an experienced manager, keep collecting information to make a proper decision. 

To do that, let’s explore the four levels of decision-making so you can get a better idea about how to make good decisions.

The 4 Levels of Decision-Making

There are four levels of decision-making. Up next, we’ll examine them in order from the least helpful form of decision-making to the most helpful.

1. Emotional

Emotional decision-making is all about how you react to certain internal or external cues. For example, if you’re on a call with a customer who’s being stubborn and argumentative, you might experience feelings of anger and a deep urge to retaliate.

Someone making an emotional decision might tell the customer, “You don’t know what you’re talking about!” This isn’t exactly the approach fo someone who delivers the best service possible.

There are, however, also instances where emotional decision-making is good. 

When you hit a target that your team targeted for three months and you suddenly feel joy and happiness, share those feelings with your team! They will be happy and glad to see that you take such pride, joy, and happiness in their work. 


2. Conscious 

Another mode of decision making is conscious decision-making. 

This involves looking at the situation and weighing the options with a rational mind. Given the same scenario, someone making a conscious decision might resist the urge to argue in favor of asking more questions to better understand the customer or employee’s point of view. 

Conscious decision-making is how you respond to any internal or external stimulus by listening to your emotions, figuring out what the best response in your situation would be, and then acting on that answer.

With conscious-decision making, you are no longer reactive. You become proactive. 

As the late Stephen R. Covey said, “You are not a product of your circumstances. You are the product of your decisions.”

Conscious decision-making is always logical, but it doesn’t always have to be right. 

3. Value-based

Unlike the first two forms of decision-making, value-based decision-making isn’t based on past information and acquired belief systems.  It’s based on the future you want to experience. 

Value-based decision-making is hard. When faced with a tough decision, making a choice that aligns with your values might require courage and conviction. This is not just a team endeavor. It’s a company endeavor.

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The entire organization needs to align around your core values, mission, vision, and purpose. And then you need to make decisions that will lead you toward that vision of the future while respecting the core values that you as a company and a team stand for.

A great example of this is the company Patagonia that does everything in a “green” manner. They don’t care what the cost is — no matter how many experts tell them that they could save money by doing the alternative.

For example, Patagonia uses a simple band to package the clothes they sell instead of the regular cardboard boxes and plastic containers their competitors use because that approach isn’t aligned with their values. 

Believe it or not, their sales actually improved with the changes. Customers could feel the material with their hands, which made their purchasing decision easier.

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4. Intuitive

This is the last level of decision-making, and it happens when you have absorbed and integrated all the previous levels of decision-making. 

Intuitive decision-making still looks into the future and takes core values, purpose, vision, and mission into account. But, as a manager, you need to make decisions with intuition. 

The difference between instinct and intuition is that one comes before experience and one comes with expertise.

When we don’t know anything about a situation, our instincts tell us how to respond.

On the other hand, intuition happens with experience — when our subconscious minds already know better than our conscious minds. This is because they’ve seen the scenario played out thousands of times and know exactly what to do in the situation. 

Intuitive decision-making occurs when you know what the right decision is without logically going over all the steps necessary to make the decision. It helps you understand when you need to challenge your team members and when you need to support them. 

And the best part about this level of decision-making is that it happens almost automatically and spontaneously. You simply know what is the right thing to do. But this, as stated before, can only happen after you acquire expertise. 

That’s how Steve Jobs made his business decisions: they made sense to him on an intuitive level. But that could only happen because Steve Jobs spent many years in the computer industry. With experience, decisions were automatic.

The mindset behind decision-making: The Stockdale Paradox

“You need the undying faith that, in the end, you will prevail. But at the same time, you need to face the brutal facts of current reality.” 

This is known as the Stockdale Paradox. It tells us a story about General Stockdale who was imprisoned in a POW camp in Vietnam. 

He survived because he believed, without a doubt, that he would emerge victorious from the camp to see his wife and be free again.

At the same time, he faced the brutal facts of the current situation which meant living day in and day out in the camp, never knowing when his freedom would come. 

With this paradox, you live in the present moment, dealing with the problems that “attack” you today. But you never lose faith that you can be victorious in the future.

This grounds you in the present but leaves enough space for you to envision a future where things fall into place. It’s a combination of the positive faith that everything will be fine with open eyes that see all the things that are bad in the moment. 

In the workplace, the Stockdale Paradox happens when you have a team that just failed to achieve their goals, but you trust that, in the end, they will make it happen. But to make it happen, they need to overcome the current obstacles that are preventing them from reaching their full potential.


Ready to sharpen your decision-making skills?

The great leaders are able to make the best decisions in even the most challenging of circumstances. Because of their expertise and calmness under pressure, they are able to intuitively figure out the best way forward — even in the middle of a crisis.

Since you’re reading these words, you are obviously interested in improving your decision-making capabilities. It may take some time. But if you’re mindful about your desire to improve your decision-making skills and consciously try to do better, you will continue to get better over time.

And that’s the ticket to helping your team successfully navigate every challenge that comes your way.

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