How do you make the right decision?
WHY IT WORKS: Decision making edition
It can be a daunting task facing a challenge (opportunity or threat) that might make or break your organisation. Too many questions and you could be wasting time on issues that are not material to your mission (the dreaded ‘analysis paralysis’), and not enough analysis could mean missing an important gap. While there is no guarantee of ‘the right choice’, there are steps you can take to test and evaluate your options and achieve two things: avoiding issues later down the track and maximising alignment to your strategy. Using the Decision analysis template gives you the structure to ask the right questions that build a complete picture to make a data driven decision that supports your mission. These are the five things that the decision analysis give you.
FIRST Getting clear on the context: what is in front of you doesn’t exist in isolation. It is both part of a number of influences on your organisation AND influences more than just your organisation. Clarifying this can help contextualise how ‘big’ the decision is and how much time, brainpower, or resources should be involved. You’ll want to:
Define what the challenge is you are facing because this focuses your efforts (1)
Understand what factors are making this important now - could it be a temporary storm that you must weather or do you need to act fast to take advantage of a rapidly closing opportunity window? Are your peers and competitors in the same position or is this something you are uniquely positioned or at risk for?
How much of your mission is it critical to? Listing your strategic goals and ticking off each one this could impact will give you an easy ‘at a glance’ idea
SECOND Understanding the players: whoever is going to feel an impact is going to have a view. Common categories include customers, staff, suppliers, partners, regulators, board or investors. How you create these categories is defined by how they are impacted by the decision at hand, so it may make sense to split them (e.g. staff may actually be managers and frontline customer service) depending on the challenge. Don’t stop at just those that come to mind immediately - think about people who don’t usually get a voice or ‘have a seat at the table’. They will likely have a good perspective that you can learn from. Why so much of a focus on people? All businesses are people businesses with staff on one side and customers on the other, so it pays to take into account and get ahead of any concerns and deliver ‘customer delight’ (if that’s your thing) by giving them what they are hoping to get (2). By articulating how they are affected, what they might hope for and what they are afraid of, you will gain more quality information about risks and opportunities. From a governance standpoint you will also know who should be kept in the loop and what should be on the agenda.
THIRD Exploring the options: there is rarely ever only one solution. There may be one action that feels immediately obvious. However each of us will have natural preferences developed over time by our experiences and it can create an automatic default position (3). Developing at least one option for a modest, average or bold level of transformation broadens the aperture of possibilities. Working through the elements of each scope (costs, benefits, time needed, likelihood it can be achieved and alignment to strategy) gives you the data you need to compare the outcomes from each option.
For each option, scope out:
Description - lay out what the end state or desired outcome looks like.
Time horizon for impact (short/medium/long) - how long after you have implemented the decision will you realise the benefits of your hard work.
Strategic fit (low/medium/high) - level of alignment with your current strategy.
Confidence level (low/medium/high) - the likelihood you will be able to pull it off (taking into account risks, constraints, etc).
Direct costs - one‑off (e.g. capex, consultants to implement, tools required) and ongoing (e.g. licences, increased headcount, training).
Benefits / value - both financial (e.g. revenue, savings) and non‑financial (e.g. mission impact, customer outcomes, employee experience, risk reduction).
Opportunity cost - what are you NOT doing because you take this route (projects delayed or cancelled because you don’t have capacity while this change is underway).
Distribution of costs/benefits - who must deal with the downside and who realises the gains.
FOURTH Informed choice on your adventure: defining clear criteria that will surface the best option, identifying any gaps in knowledge and the steps to take to get the information you need in order to make a robust decision.
Decision criteria - Agree which are the most important criteria for your organisation (no more than 3–5 criteria, you can weight in terms of importance when using them) to assess each option against (e.g. strategic fit, financial return, risk profile, impact on mission/people). Scoring each object objectively in a data based approach will both increase the quality of the decision you make now and your ability to measure whether you have achieved the right outcome (4). Decision makers should rate each option independently to achieve the best quality input and avoid groupthink (5) before coming together to discuss their preferences and reasoning to agree on the best option.
Summarise the information you currently have (e.g. market insight, customer feedback, internal metrics, staff surveys) and gaps you need to fill (3–7 key questions that would materially change the decision if answered) plus your plan to find out, which could include things like interviews, quick financial models, external advice.
Are you making any assumptions that your plan is reliant on? eg. “This only works if…” list (e.g. “we can hire X skills”, “partners are willing to Y”, “regulators will accept Z”). Mark which assumptions need testing before committing.
FIFTH Surfacing the hidden dangers: the potentially unspoken constraints, risks or pitfalls and forward impacts that could impede your ability to get the outcomes you want. Being clear about these allows you to an implementation approach that mitigates or balances these to consider the implications of taking that path.
For each risk you will want to address the likelihood of it happening, what the impact is if it eventuates, any potential steps you can take to mitigate the occurrence or the impact. Include people risks (burnout, turnover, loss of trust) as well as purely financial or technical risks. They are important in and of themselves, but long term can turn into financial or technical risks.
Constraints are the boundaries that you will need to work within. Consider hard constraints which are likely immovable (money, time, capacity, regulatory) and soft constraints that could be nudged a little (culture, skills, leadership attention).
Finally, what would happen if you proceed with the preferred option? E.g what tensions would need to be managed, what behaviours or processes would need to change? Important information to incorporate into your implementation and ongoing support structures, these implications might also inform your decisions and under what conditions you would want to proceed.
Think of this guide like a snakes and ladders board - except it’s only ladders. What does that mean? Working through the each area sequentially will systematically build out the data and criteria you need to make a robust decision. The snakes are the information gaps or assumptions that need to be tested that you might need to go back and gather the appropriate information to fill in, but that delay only helps get you to the right destination safely.
Read more
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Graham, Mark. (2025). Stakeholder Identification and Mapping.
Lira, B., O'Brien, J. M., Peña, P. A., Galla, B. M., D'Mello, S., Yeager, D. S., Defnet, A., Kautz, T., Munkacsy, K., & Duckworth, A. L. (2022). Large studies reveal how reference bias limits policy applications of self-report measures. Scientific reports, 12(1), 19189. https://doi.org/10.1038/s41598-022-23373-9
Miser, Evin & Sarioguz, Orcun. (2024). Data-Driven Decision-Making: Revolutionizing Management in the Information Era. International Research Journal of Modernization in Engineering Technology and Science. 10.56726/IRJMETS49577.
Marlene E Turner, Anthony R Pratkanis (1998). Twenty-Five Years of Groupthink Theory and Research: Lessons from the Evaluation of a Theory, Organizational Behavior and Human Decision Processes, Volume 73, Issues 2–3, Pages 105-115, ISSN 0749-5978, https://doi.org/10.1006/obhd.1998.2756