“No Decision” is Still a Decision – What Does it Cost You?
Have you put off a decision lately? Could it be costing you more than you realize?
Are you aware that you made a decision to read this blog post? Your brain looked at the title, ran a rapid cost/benefit calculation, and determined you were likely to get something of value from reading the post. And we’re glad that’s the decision you made!
Because making decisions is work. It takes effort, especially with important decisions. We ask ourselves questions like:
- Maybe I don’t really have all the information I need to make the “right” decision.
- Maybe there’s no such thing as a right decision in this case.
- What about all the catastrophes that could ensue if I make the wrong decision?
It’s stressful, and it’s often easier to put off making the decision at all. Why risk it? You’ve successfully avoided, or at least delayed, the consequences of a wrong decision, and maybe the perfect answer will become obvious if you give it time to reveal itself. Or maybe this will turn out to be a decision you didn’t need to make at all.
But “no decision” is still a decision, and there are still costs when you decide not to decide.
What Can Not Deciding Cost You?
If you were contemplating a change, you have already identified shortcomings with the status quo that need to be addressed. You’ve already admitted a change is needed.
If you put off the decision to address needed change, you have decided to leave your organization lacking and vulnerable. Many in leadership have been overwhelmed by rapid change and innovation because they stuck with “probably good enough.” Here’s the damage that kind of thinking can do:
- Cost Increases on the Existing Solution
What was right years ago is not likely to be right today. Even if you keep the same solution, keeping it up to date and working reasonably well is going to require continuous investment to keep it even borderline relevant. Typically, the more outdated a solution becomes, the harder it is to maintain and upgrade because the product is no longer supported as it once was.
Think about loyally sticking with an old car. At a certain point, the repairs become more expensive than the payments would be on a new, reliable vehicle. Parts are harder to find, must be special-ordered and are more expensive. You might need a specialist mechanic who’s familiar with the older models.
- Lost Profits, Growth and Revenue
A solution that increases operational cost is going impact profit margins. But there’s also the potential loss of revenue, profit, and growth that a new solution can bring. You may not be taking into account the fiscal growth a change can bring to the organization. Choosing change requires vision, foresight, and faith that you can leverage this change into increased revenue. But as hard as that faith can be to have, the status quo will likely not lead to new growth. It’s that certainty that can make the decision to change a bit easier.
- Lost Opportunities
We’ve all heard the story—a small business owner was presented with an enormous opportunity to do a big job for a big client. The job would fundamentally change the stature and earning power of the business. It would lead to more big jobs that would allow the business to scale and become more profitable.
But because that small business never equipped itself to handle a big job, it reluctantly had to refuse the job. That is a prime example of lost opportunity—having to pass on growth and profit because you didn’t prepare yourself for those opportunities in advance.
- The Personal, Career, and Morale Costs
How often do you hear stories about people who played it safe all the way to the top? Rarely, right? Playing it safe is temporarily comfortable, but it’s not how people attract the kind of positive attention that leads to promotions, raises, and new job offers.
What would you think if someone’s resume achievements included, “I successfully said ‘No’ to implementing new accounting software for seven straight years”?
Decisions affect everyone. If you hold a leadership role in an organization, costs like those above will almost certainly have an impact on morale, on people’s belief in the organization, and their trust in leadership.
Helpful Tips for Making Good Decisions
- Identify that a change needs to be made to achieve organizational desired goals and objectives.
- Gather the information you need (and only the information useful to decision-making, don’t bury yourself in unnecessary research) to clearly lay out the options.
- Draft the options. This is a menu of the choices you can make.
- Weigh the pros and cons of each option.
- Ask for input about the options from a range of sources like internal resources, consultants, published articles, peers, association members, etc. Liberally dispense with any opinions that aren’t informed or relevant.
- Make the decision. Whether it’s to a stakeholder or just to yourself, clearly outline the justification for why you made that choice, acknowledging the potential risks and rewards.
- Don’t second-guess or go back into decision-making mode unless you discover facts on which you based your decision have changed.
- Fully commit to the execution of the decision. Often, people are exhausted from having made the decision, or still not one hundred percent sure about it, and then only halfway or half-heartedly execute the decision, which is counterproductive.
- Track, measure, and adapt. The goal here is to eliminate the nagging question of “Did I do the right thing?” by keeping watch over the results of the decision. If results aren’t optimal, use what was learned to adjust the approach.
Summary
As human beings, everything we do, we do to pursue pleasure or avoid pain. The inability or unwillingness to make a decision may avoid pain temporarily, but it can lead to regret, a painful emotion to carry, as well as a hit on your self-image.
Conversely, there is a lot of pleasure and satisfaction in moving forward, growing, and improving. These things only happen when we’re willing to make decisions and take action. Because action is ultimately the path to success.
