6 Steps to Making Better Decisions

6 Steps to Making Better Decisions



Last Updated: Oct 16, 2017
Being able to make better decisions is important for your business to succeed. Being able to make them quickly is important as well. These six steps can help you make better decisions.

Are you a decisive person? If your answer is, “I don’t know,” you’re probably not! Some people are better at making decisions than others. Some people are better at making the RIGHT decision better than others, and some people could use a little help.

Regardless of which category you fall into, as a business owner, you’re likely faced with making decisions all day long, some that could have lasting impacts.

Learn to make better decisions faster using these six steps:

1. Quit Trying to Achieve Perfection

Economist Herbert Simon wrote about “satisficing” in 1956. Basically, a satisficer takes action as soon as their criteria are met. It’s not a matter of settling for less than the best. Instead, it’s setting and sticking to criteria that you know you’ll be satisfied with once they’re met.

Maximizers are different. They want to make the best or optimal decision. Even if their criteria are met, they will keep looking for a better option. They’re never truly satisfied because they believe there’s a better option that they couldn’t find. Satisficers are happier because they spend less mental energy trying to find perfection. Constantly looking for more information comes at a cost. At some point you have to stop and make a decision.

RELATED: 8 Steps to Making Decisions More Easily

2. Think Like Franklin

Joseph Priestley was the nephew of Benjamin Franklin. Priestley wrote to his uncle about a tough life decision he had to make. Franklin told him to use something he called moral algebra. Divide a piece of paper in half and write the pros on one side and the cons on another. After thinking about it for a few days, when you find a pro and con that are of equal weight, cross each of them off your lists. What is left is the best answer.

Decision making doesn’t have to be so stressful. Get this free decision making guide when you sign up for the Business Know-How newsletter. 

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3. Go with Your Gut

Psychologist Gerd Gigerenzer wrote a book called “Gut Feelings.” He said that we’re wired to make quick decisions based on limited information. “Heuristics,” as he calls it, is simply taking efficient cognitive shortcuts to make better decisions faster.

To break down all of the science, think of this: Every decision has numerous variables you could consider, but if Gigerenzer is correct, you will quickly decide which are the most important and only consider those.

You might be thinking that considering less information is quite an ignorant approach to making a decision. If that’s your view, there’s a large body of psychologists that agree with you, but Gigerenzer asked a computer to analyze which Chicago high school a pair of hypothetical parents should most consider for their child. The computer weighed 18 variables using a complicated formula. In the end it only considered 2 of the 18 variables to make the choice. Gigerenzer argues that this is proof that more information isn’t better.

4. Understand Cognitive Bias

“Tell me about your childhood,”—a common and maybe cliché question that therapists often ask their patients. As you collect experiences, positive and negative, your mind creates biases. For example, if you were mugged on a certain city street, you would likely develop a bias that would drive you to avoid that street. Or maybe you went through an awful divorce and you have trouble believing that any potential mate could be faithful. These are examples of cognitive biases.

Every decision you make, thought you have, or even word you say first went through a filter of your life experiences. Psychologist, Dan Gilbert says in this TED Talk that we aren’t very good at predicting what will make us happy because of these biases. Instead, we’re probably better off just asking somebody else what they think. In other words, if we want to make better decisions, it’s sometimes a wise move to get help from others.

RELATED: How to Make Good Business Decisions

5. Choose Your Timing Wisely

Should you make a big decision right after an argument with your spouse? How about when you’re not feeling well or had a long stressful day? Most people would agree that making a decision when your mind is sharpest and free of outsized emotion is the best time to commit to a course of action.

Oddly, though, we often make decisions at the worst times. If nothing else, don’t make quick decisions. To make the best decision, take a day or two before deciding. But don’t take too long. “Analysis paralysis,” or overanalyzing, is just as dangerous.

6. Decide Which Decisions Are Important

Business owner or not, you’re faced with multitudes of decisions all day, every day but not all decisions should receive equal weight. Should the brand of dental floss command the same amount of research as the make and model of your next car? Should you research the type of lawn fertilizer as much as you learn about a health condition? The answers seem clear but some decisions in business are more important than others.

If you’re a very visual person, you might put way too many hours into picking a logo while somebody else is waiting for you to secure business licenses. When you learn to prioritize decisions and only place a lot of time and energy into the ones that deserve it, you can concentrate on decisions that will truly move your business forward.

Bottom Line

Some people are naturally gifted at making decisions. Other people surround themselves with good decision makers. Like anything else, you can grow in your ability to make better decisions but having a counsel of people to help you is just as wise.

Decision making doesn’t have to be so stressful. Get this free decision making guide when you sign up for the Business Know-How newsletter. 

Request your free decision making guide

© 2016 Attard Communications, Inc. All Rights Reserved. May not be reproduced, reprinted or redistributed without written permission from Attard Communications, Inc.

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Choosing a Business Name? Avoid These 6 Mistakes

Choosing a Business Name? Avoid These 6 Mistakes |A&C Accounting And Tax Services



Choosing a good name for your business isn’t easy. You want it to reflect your business’ personality and be catchy without being silly. Before you make your final decision, be sure you avoid these business naming mistakes.

A business name that is appealing and memorable can do wonders for a business’s bottom line. On the other hand, no matter how great a business is, an inappropriate or poorly-chosen name can have a negative impact on its success — especially when first starting out.

Some aspects of selecting a business name are subjective and reflect the personal wishes and preferences of the owner.

There are, however, some mistakes that business owners make in naming their establishments that just don’t make good business sense. Avoid these and you’ll be on the road to having a business name that will serve as a real asset and hopefully bring many profitable returns.

1. Getting stuck in alphabet soup

A business name that comes at the beginning of the alphabet can be a plus since many business listings are alphabetical; however, some businesses have taken this strategy to absurd levels. Phone book pages produce a staggering number of businesses starting with the letter A, a number of which are somewhat nonsensical: “AAAAA Locksmith” and “AAA Active Appliance.” Other than another word that starts with the letter A, what purpose does the word “Active” serve? Using A, B, or C as the first letter of your business name can help get you an A+ in profits, but be sure the name is something that makes sense and is something you can be proud of.

2. Using names that are too long, or difficult to understand, spell or pronounce

The idea is to get people to remember your business name and to be able to understand it, spell it and pronounce it. It should also be short enough to fit on a business card or display on a sign. I doubt the “Floccinaucinihilipilification Company” name would be easy to pass along by word-of-mouth or found readily in a phone book, directory or on the Net. It actually is a word that means “nonexistence” and that’s probably what would happen to any business using it as their name; namely, no longer exist.

3. Picking business names that limit business growth

Choose a business name that is wide-ranging enough to give your business growing room.

Geographic business names are popular; i.e., Hidden Springs Housecleaners. But what happens if your business takes off and you’d like to expand the geographic area you cover or even go national? Unless you’re sure you want to stay in one particular location, avoid using geography in your business name. The same goes for naming a business after one product or service: “Al’s Refrigerator Repair Service’s” name would need to change if Al decides to take on air-conditioner repair. Lastly, stay away from names that describe current fads or trends: When the new “Millennium Diner” opened in 1999, it sounded timely — six year later, it sounds dated.

4. Letting the grey areas get you discouraged or immobilized

A business name should be one or more of the following: memorable, descriptive, imaginative or distinctive. How to go about this is where the “experts” disagree.

A good way to start is to write down key words that describe what your business is and does, and what you pride yourself on. Use a dictionary and thesaurus to find different words that express these things. Also look for famous expressions that might pertain to your business.

So, let’s say “Mary” has a small business selling her delicious fruit tarts, and she considers herself to be the best at what she does. Mary names her business “Queen of Tarts” because: she loves the play on words, it expresses what her business is and does, and the word “queen” is perfect — she’s female and her thesaurus shows that “queen” also means “person of authority.”

The following techniques of naming businesses are ones that naming pros both love and hate, depending on which pro you speak to. Review the following “bones of contention.” It will be up to you to decide if any of these feel right for you and your business name. Keep in mind your target market, the key elements of your business and mission statement, and — above all — trust that feeling in your gut.

Alliteration: The repetition of the same sounds at the beginning of words

If your name is Cathy, and you’re selling collectibles, you could name your business “Cathy’s Collectibles.”

Coinage: The invention of new words

“Forever Nailz” salon and “ErgoGrip” pens

Descriptive Words: Words in a business name that convey immediately what your business does

“Frank’s Reliable Lawn Care” and “Commercial Cleaning Corp.”

Puns: A play on words

“Hair Force One” and “Shear Artistry” haircutting salons

5. Being an island

You’ve thought up 15 business names that are in the final running, and you think they’re all pretty good. Now is the time to get some feedback. Run those names by some close colleagues, family and friends. You might be surprised at the number of things they bring to your attention that you’ve overlooked. A little constructive objectivity goes a long way when choosing a business name.

6. Failing to check if your chosen business names belong to another business

Before settling on a final name, you’ll need to ensure that you won’t be violating someone else’s trademark rights to a particular business name. You want to avoid being forced to change your business name in the future and possibly paying money damages.

Here are some ways to avoid using a name that’s identical or confusingly similar to the one you want to use:

For a fee of at least a few hundred dollars, you can also hire a professional search firm to do a trademark search. Just the peace of mind alone that nothing has been overlooked can make this investment worth your while.

As far as naming your business, there are professional naming firms that will come up with a great name for your business, but costs can be prohibitive. David Burd, President of The Naming Company, quoted “$15,000 to $20,000” as a typical fee to have a professional team come up with a business name. For large corporations, Burd said, fees could easily go to “$50,000 to $60,000.”

Coming up with a business name isn’t particularly easy, but if you avoid these common mistakes — and invest some time and thoughtful effort — a great business name should be well within your grasp.

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Copyright 2013 Attard Communications, Inc

 

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