Humans have a tendency to act irrational and think biased when it comes to making critical decisions. These biases don’t necessarily mean we are prejudiced, though— they are just reflections of how we see the world based on our upbringing and background.
There are two types of biases that people make causing us to diverge from making logical decisions: cognitive and emotional. Cognitive biases are results of incomplete information and lack of comprehension of the available information. On the other hand, emotional biases occur spontaneously based on the personal feelings of an individual at the time the decision was made.
While the existence of such biases, be it cognitive or emotional, is not inherently bad, the problem may arise if it creeps into objective decision-making processes. As an entrepreneur, you must prevent biases from influencing your judgments consciously or unconsciously. How can you do that? Well, these tips can help you do just that.
1. Implement data-driven decision making
Instead of going with a typical strategy, implementing a data-driven decision-making strategy (DDDM) can make your business less vulnerable to risky decisions.
For instance, instead of starting from scratch and experimenting with a new strategy, take a look at your previous products. Replicate all the effective data and disregard the unsuccessful ones.
You can apply the DDDM strategy in all phases of your business, from finance to customer service. Such data can help you find out the most cost-effective way to hire new staff, how to improve customer loyalty, and which sales generate the most leads.
Read: Working-From-Home: 5 Ways to Prove Your Effectiveness
2. Create a diverse team
One of the best ways to deviate from making biased decisions is by creating a group of people with different experiences on a particular matter. Remember that there’s never one way to solve a problem; each person has a unique blend of problem-solving approaches based on their background, experiences, and personalities. This means that the more diverse your team is, the more opportunities you get to solve a problem.
Read: 2 Winning Habits to Help You Stop Complaining
3. Wait 24 hours before finalizing a decision
When in the face of critical decision-making, you should never let your impulse and emotions take over your rational decision-making. There are days when you are so confident about your decisions that you make other decisions based upon it. Then the next day, you realize that your decision may not be the best one off the shelf.
That’s why you have to wait at least 24 hours or more before finalizing a decision. Contemplate the decision you have come up with. Chances are you will have a change of heart the next day. Sometimes, it’s better to extend the project to be able to come up with the best decision rather than to decide compulsively only to fail in the end.
Read: Best Accounting Software for Small Businesses in 2021 (Paid and Free)
4. Subdue your initial feelings
Your initial feelings can steer the decision-making process. If you develop a hypothesis without scrutinizing all the evidence, you might suffer from confirmation bias or the tendency to ignore evidence that refutes your hypothesis.
When making decisions, it is imperative that they are made with a calm and cool frame of mind. Keep in mind that emotions have no place in all the decision-making processes.
For effective leadership and sustainable development, you must reframe your mind not to let your emotions meddle with your career. Instead, use your emotions to promote thinking and cognitive activity. After all, emotions can help us prioritize what we pay attention to and react to.
5. Look at the bigger picture
When you are in the middle of a decision-making process— be it big or small— always look at how it might affect your business in the long run. Keep in mind that every decision will make or break your success.
Give yourself some space for at least 30 minutes a day to think high-level. Where do you see your business in 5 years? How would your decisions contribute to that vision? Establish a clear idea of what you are trying to accomplish as it would outline every step you need to get there, including your decisions.