Decisions, decisions, decisions. Every day requires a lot of decisions, especially in the business world. A requirement of good leadership is the ability to take in information, analyze it, and make decisions regarding the information received. Sometimes those who rise the top in leadership are simply those who have the guts to make decisions and follow through better than those around them.
In our field of commercial and agricultural underwriting, it requires synthesizing a lot of information and making informed decisions based upon that information. Simple right? Well as simple as it is, there seems to be quite a few obstacles that prevent the proper execution of making and living with the decision.
One factor is the analysis paralysis. This is the situation where there is a constant request for data, information, and forms, without any idea of what any of this information actually means. Credit analysts can get into this trap. We often can become more obsessed with checking the boxes on the list than we are with understanding what the information we have is telling us. It leads to faulty loan underwriting where the risk in a credit is never fully understood. My suggestion is if you are in the check the box trap, seek to get as much understanding as you can so you can execute proper risk analysis of the credit request. Understand the credit so well that you can defend your analysis.
Corporate culture can either create an environment for all to take ownership and make decisions or where an endless stream of reviewing data continues with no real conclusions are ever reached. Oftentimes these shops will be easy to condemn bad decisions. This creates an environment where people are afraid to make a decision, because they think they will be punished if it goes wrong. Inaction and constant analysis are valued higher in this arena than are actual action and accomplishment.
Companies in with this culture find employees swimming against a strong tide of criticism, with little or no achievement to show. Oh, these entities may reach greater heights, but the opportunity to really reach their true potential never materializes. Teddy Roosevelt once said, “It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
So back to decision making. It has to be expected that sometimes when decisions are made, there will be some mistakes. The real test is not to make the mistakes, but what your next move is after the mistake is made. For the company, the culture will determine what happens when mistakes are made.
Decision making also comes with the time factor. The wrong decision at the wrong time is a disaster. The right decision at the wrong time, will not lead to the results desired. The wrong decision at the right time, is a lost opportunity. The right decision at the right time, now that leads to success.
Decision making is also required when negotiating. The party you are working with does not want to constantly hear, “well I have to check with,” “I don’t have the authority to say,” or “we have to get our committee’s approval”. By now the other party is thinking they just want to talk to someone in authority or just take their deal to someone else. I love negotiations and the interaction back and forth that occurs. My goal is to have the playing field well-defined when entering into discussions. Yes, in many instances there will be items that require the approval of some higher authority. But, knowing and articulating what can and cannot be done increases your stature in the eyes of the client and will ultimately bring you more business. People like doing business with people they view as an expert in their particular field. Think to the last time when you dealt with a store clerk who did not have the authority on an item you are trying to return. After the third “I will have to get that approved,” you tend to be ready to just speak with whoever is in authority.
So there you go. A few thoughts from my porch on a Sunday afternoon. Embrace the challenge of making decisions. Avoid analysis paralysis. Realize you will make mistakes. Empower your team and avoid the circular fire mentality. Realize the critic is not the one in the arena who actually accomplishes great things. Be aware of proper decision timing. Learn to negotiate well. At the end of the day, these skills will help you succeed in your decisiveness.