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(Brian Jackson/Getty Images/iStockphoto)
(Brian Jackson/Getty Images/iStockphoto)

COMMENTARY

Why you should avoid gut instincts to make business decisions Add to ...

When it comes to running a small business, I don’t have a lot of regrets. The few I do have usually revolve around looking back and realizing that I had access to many facts and figures that I ignored, relying on gut instincts instead. If I had paid more attention to them, I would have made better decisions than the ones I made acting too hastily on what my gut told me to do.

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This happens to many small business owners more often than it should. While they have every right to rely on their instincts and intuitions to make strategic decisions or overcome an emergency, they may be overworking their gut.

Gut instincts certainly helped to shape the person you are and the business you created, but you really should rely on them only when necessary. Taking time to slow down, collect facts and see a decision from all angles before actually making it can help you see opportunities that you might otherwise overlook.

While this takes a lot more time, patience, discipline and, often, expense, it is almost always worth it.

I was reminded of this recently when I was at a client’s manufacturing facility and was asked my opinion about moving a major piece of equipment to a new location in the plant. I spent a good 30 minutes discussing with the principals the pros and cons of keeping it where it was or moving it, and they wanted my recommendation.

All of our gut instincts told us that a move of the equipment would be the right move. But there were still many facts and figures that had not yet been examined or needed a deeper dive. I needed to postpone the decision to make the right decision. And to do that, I needed to turn to one of my favourite management techniques, which I call the “choiceless decision.”

Quite simply, it’s the decision where you have no choice but to reach the right one. Because once you pay attention to all of the facts and figures, the correct outcome is obvious.

The choiceless decision is a term I coined to remind myself that, at many, many decision points, aggressive fact collection and calculation will result in data that make one decision obviously superior to another. I have found that this really works.

All that is usually lacking is the patience to slow down and quantify the options. Once you do, the resulting data usually reveal a direction that almost anyone would take, if presented with the same information. This process dispenses with assumptions and educated guesses and breaks down decision points to the level of making them, well, choiceless.

In the case of that equipment move, I told my clients to let me think it over. Then I parked myself in a cubicle and itemized every step in the process of the equipment’s use in its current location and every step in the process in the proposed new location. I drew spaghetti charts to help me visualize both options. Pretty textbook stuff, really.

My analysis raised several unexpected negative side effects that would occur if the equipment was moved. The facts and figures produced information that none of us had expected. They created a choiceless decision: the equipment had to stay put.

The time I put into this analysis might have seemed extravagant at first, but not when it produced the right choice with such obvious clarity.

Challenge yourself and your team to approach opportunities and problem-solving less often on quick gut decisions and more often by taking the time and facts and figures that will produce choiceless decisions. That’s when the results will give you no choice in your decision. Because the right one is clearly right in front of you.

Special to The Globe and Mail

Chris Griffiths is the Toronto-based director of fine tune consulting, a boutique management consulting practice. Over the past 20 years, he has started or acquired and sold seven businesses.

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