Analytical Decision Making

Influential leaders are efficient decision-makers. Your overall success as a company depends on your abilities to evaluate information and make rational conclusions. At times, you may find that there is no easy choice to make. In these cases, you’ll need to rely on the quality of your information and your ability to interpret it. This skill puts you on the path to leading your company in the right direction.

In our previous article, we reviewed the more analytical aspects of making intelligent decisions using data. Here, we will elaborate on several methods covered and give you tips to apply them in your everyday decision-making. If you’ve got an important choice to make coming up, don’t stress. We’ll walk you through what you need to make the right choice confidently.

The steps to sound decision making

You can think of good decision making like how a scientist would conduct an experiment. You want to start with a question, review the available information, clarify your question with the new knowledge you have, conduct your research, and analyze your data. Then, you can come to a conclusion. However, there are some details in each step that could make or break the entire process. For example, what do you do if some of the information is not reliable? How would you know in the first place? First, let’s review the steps in a little more detail.

1.   State the decision

In this example, you want to state the decision you have to make and as much detail as possible. For example, imagine that you’re trying to allocate your marketing budget for the quarter. You have two options for your ads budget: LinkedIn or Facebook. Here, you’d want to identify the campaign that you’d be promoting and your options to choose from. Make sure that you include the desired result to see which of the two options would get you closer.

2.   Gather your information

Here, you’ll spend your time gathering more information about your decision. For example, what kinds of advertising does each platform offer? Who will be involved in making a final decision? Have you tried a project like this before, and what were the results? This step will help you clarify what the most feasible options are in your next step.

3.   Define your options

Using the information you gathered in the last step, layout the most promising courses of action. Going off the above example, you may have decided that promoted posts on each platform fit your needs the best. Perhaps the other options didn’t work within your budget or had been tried before in a similar way with little success. Now, you have the most realistic paths to accomplish your goal.

4.   Perform your research

Now that you have your options laid out, you will start researching to decide which option you will ultimately take. In this case, you may want to look at the demographics of who you’re targeting and then see which platform they use the most. If you’re targeting consumers, you might favor Facebook for its focus on individuals over businesses. Or, if you’re working in a B2B industry, you’d likely find more probable clients on LinkedIn. Next, you’d look at the potential cost and results from each campaign based on what you’ve done before as a company and research from other sources. When you’re done with this, identify the pros and cons of each choice and present your findings.

5. Make your choice

Now that you have all of your information, you can commit to your decision. It’s important to note that, more often than not, there is no perfect choice. What you’d like is the better of the options that you have. If you did your research correctly, you’d have a solid foundation of knowledge backing up your choice. Execute your plan and then move on to the next step.

6. Evaluate your results

What’s your project is complete, document everything that happened from beginning to end. This step aims to gather the information that can help you make better choices in the future. Did the campaign perform as expected? Did you reach your goal? Were there any unexpected costs or consequences from your selection? No matter what happened during the project, the information that you collect now will help steer you in the right direction next time.

Following these steps will help guide your decisions in the right direction. However, with a little more detail and consideration, this guidance can go even further. Next, let’s check out a few steps on making sure that you can trust the information you find during your research.

Evaluating your information

Misinformation usually has enough facts to sound reliable, but ultimately its message can lead you astray. How can you tell what information you can and can’t trust? There are a few skills that you can build that help you evaluate the quality of data. Especially when you need to make an important choice, the information you use needs to be reliable. Even smaller options based on questionable information can have serious consequences. Ensure that you go into your project prepared and do your due diligence when choosing how you support your decision.

Unreliable information usually gives itself away with one of the following tells. We’ll outline some questions to ask when gathering information and explain affect its quality. Let’s take a look at some pointers to keep in mind in your research.

1.   What is the goal of the information?

When you start reading through a piece of information, think about what they’re trying to do with the article. For example, a newspaper article provides information, usually about a specific place. Videos online may serve to entertain, and blog articles or marketing materials on a business’s website often serve to sell products. Other pieces like personal blog articles and editorials in magazines try to convince someone of a particular idea or advocate for a cause.

Also, think about who they are trying to reach. Sometimes it’s easy to tell the intended audience of the information. You could safely assume that a video on how to train dogs is targeting dog owners. Commercials for toys cater to children. Pieces like newspapers and magazines may be a little broader, but you can generally tell who they’re trying to reach by the subjects that they discuss. When you put these two questions together, you can get an idea of who they are trying to reach and what they want them to do.

2.   Is the author an authority on the topic?

The next questions you want to ask concern the author of a piece. Is the author’s name clearly available? Or, if an organization wrote it, is there contact information easily accessible? Do a quick Google search on the author or publishing organization of a piece of information. If the author is an individual, check their education and experience on the topic at hand. Do they have a history of providing information in a specific area? Are they affiliated with any organizations that may affect the credibility of their work? Check to see if they mention any universities, nonprofits, affiliated businesses, or agencies that they work with.

Next, look at where and how the information was published. If you found the information online, is it a personal website from the author or associated with a larger organization if you found the information online? If it’s a book, look at the publisher to see if it’s related to a university or a large commercial publisher. Both of these entities will take extra time to check the information that their writers produce. If you’re using a newspaper or a magazine, go back to the first question and notice if it serves for entertainment or education.

3.   How accurate is the information?

Even when information appears to be common knowledge, the author should include links to outside sources that verify their claims. Check for hyperlinks online that link to external sites. They should both be reliable and verify the information from the first source. If the information you’re reading includes any kind of statistics or factual information, check that you can back it up with another source. If you find the source of information and can view the study, take a look at how researchers collected the data and if the author can say that the conclusions were valid.

4.   How recent is the information?

Sometimes, you need current information in order for it to be accurate. These circumstances could include planning for your next steps in a quickly changing industry. You wouldn’t want to read a market forecast from 10 years ago when making decisions for today. Some information, especially regarding established science, doesn’t need to be current as long as the information is still accurate. Historical information also serves a unique purpose with some projects. If you’re reading a book or an article, check the publishing date printed on the cover or the first few pages. If your source is online, some pages have the information listed in the footer. Websites are typically more difficult to date than print media.

5.   Is the information fact or opinion-based?

Opinions have value in the decision-making process, especially when founded on facts. For example, it may be your opinion that you should choose LinkedIn marketing over Facebook because you read that more of your Target demographic uses LinkedIn. However, the most important part of this is that facts are indeed involved when forming an opinion. When you do your research, look for fact-based articles. Misleading sources often use some facts, but draw conclusions from them that may not follow. Look especially for emotionally charged language, including words like humiliated, smashed, infuriated, and destroyed. These words will often play off a reader’s fear or excitement. If you find that the article is mostly based on fact, double-check their citations with the tips above and rest assured that your source is trustworthy.

The extra time you spend verifying your sources pays off in your end result. A little bit of homework now can save you an avoidable headache later. Now that you have a reliable method to make fact-based decisions, let’s finish up with a couple of pointers for the execution.

Perfecting your method

When you’re making your decisions, it’s important to stay focused. Often, you’ll find that you’re confronted with conflicting ideas and opinions from those around you. Do your research independently and invite collaboration when it’s appropriate. For example, rather than asking what to do on a particular step, decide on how you would do it and then ask for a pointer on a specific detail of your plan.

On a similar note, don’t strive for perfection with your project. Nothing is perfect in practice and expecting perfection only makes your team hesitate when taking action. Instead of planning exact outcomes for each step, plan where you need to be firm and where you can be flexible in the execution of your project. This helps you adapt quickly to change while maintaining the structure of your plan.

Closing thoughts

Fact-based decision-making helps you achieve your desired outcome. By taking care of steps to align your planning with your goals, you will see more reliable results and get information that benefits your future endeavors. Structured planning allows you to take greater risks that yield rich rewards. By understanding the possibilities that come with each course of action, you create a unique edge for your company within its industry.

You’re not alone in your quest to make better corporate decisions. A fractional CMO or fractional COO can lend a hand in directing your team and showing you the pros and cons of each choice. They balance experience with availability, serving as a part-time c-suite member for your team. A fractional CMO provides a unique edge for developing your marketing and sales strategies and a fractional COO guides your organization from the internal processes forward. Do your research and see who is the best for your team.

Careful planning is not all. Next, you’ll want to consider the environment in which your project will take root. This includes your employees, your resources, and the greater implications of your industry. Take a look at our article here to find out how you can engage your employees and make them an active part of your company’s success.