Effective Decision Making Processes Integrated at all Business Levels

Strategy Plan One

April 27, 2012 

Effective Decision Making Process

Every business opportunity, every operational activity, and every financial budget requires decisions.  Decisions can be made in an ad-hoc, instantaneous manner, but we have all encountered challenges that occur after a snap decision.

Effective decision making processes set the stage for standards for making the right decision, involving the right people in your organization, with appropriate tools and mechanisms.  Great effective decision making processes will make your organization and professionals more responsible and accountable for decisions made

As an entrepreneur you will develop procedures that will need to be done to make a decision.  You will integrate specific staff members, at all levels, into the decision making process that will make a better informed, effective decision.

Elements of Effective Decision Making Process

Similar to a strategic planning cycle, decision making processes follow a set of steps:

1. Identification of the Issue
2. Development of options to resolve
3. Selection of the best option
4. Recommendation of the option
5. Approval of the proposed solution
6. Implementation of the best option
7. Measurement of result
8. Revision of the process / options 

You will determine who on your team should be involved and should participate in decision making.  You will want to involve those who are functional specialists who will inform you on the best operational, ground-level solution and what the implications are.  You will also want to involve unit managers and supervisors who can recommend the best option after being informed by their area experts.  Keep in mind, you want to have a streamlined decision making process and not to include too many.   Less is best when decision time frames need to be considered or if client services are impacted by decision time frames.  You can still develop a highly accountable decision making process with select staff, streamlining approvals through one stream of employees.

Effective Decision Making Processes – Determining Priorities

Decisions need to be prioritized, with reference to many factors that do go into why decision need to be made and to determine which decisions need to be focused on and approved first.

You may determine priority decisions be made by the following factors:

• Time factor or time limiting
• Emerging, immediate needs
• Client service focus
• Financial impacts
• Risks to the organization

Effective Decision Making Processes – Risk Management

A strong and embedded effective decision making process in your business will minimize the risk to all aspects of your business along the way.  As mentioned the stronger your decision making process, the more accountable your staff, units, managers and the business itself will be.  As a good planning practice, you should develop your business plan to reflect effective decision making processes at operational, management and corporate levels.

Strategy Plan One

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© 2012 Strategy Plan One

Economic Indicators, Interest Rates Outlook Positive for US Businesses in 2012

Strategy Plan One

March 18, 2012 

US Economic Indicators

As an entrepreneur, review and keep track of US economic indicators and trends.  With the latest report on US Job Recovery in February, many indicators are looking positive.  A recent Bloomberg report cites positive trends in indicators such as the Gross Domestic Product, consumer confidence, the housing industry and interest rate figures.

Economic Indicators – Gross Domestic Product

The Gross Domestic Product (GDP) is the indicator of the market value of goods and services produced in the country through a specific period.  The sources in the Bloombergreport estimate that GDP will grow by 2.2% for 2012 in the US, up from 1.7% in 2011.  Good potential news in the country as recent manufacturing reports have been favorable.  Also an emphasis on “Made in the US” strategy will help boost GDP as the focus may be away from many foreign manufactured or supplied goods.

Economic Indicators – Consumer Confidence

Consumer confidence is the measurement of how positive, how comfortable the consumer is with the economy and their own personal finances.  It is usually tied to growth in consumer spending in the economy.  Business Week reported a rise in consumer confidence to a four-year high, and further stated a Bloomberg Consumer Comfort index rising.  Improved industry sectors and employment may be the reasons behind a recent rise in consumer confidence.

Economic Indicators – Housing Industry

A Washington Post article is one of those reports pointing to positive trends, showing the housing market stabilizing and in some sectors, housing sales improving.  With improvement in the housing industry, many other indicators such as employment, retail and material sales could improve.  However, in a fragile economy many of these industries are linked, and so is growth.  Factors such as the increasing fuel could have a negative impact on these recent housing market improvements.

Economic Indicators – Interest Rates

The Bloomberg report sources indicate that interest rates will remain steady and low over the next two years.  This is potentially good news for entrepreneurs who will be looking to start-up new ventures and need commercial loans.  This is also favorable news for existing businesses looking to expand and in need of additional funds.  Within your financing mix, commercial loans take up the majority percentage of all financing.  The low rates will help lower the overall cost of borrowing.

As an entrepreneur or business owner, carefully watch and review economic indicators and trends, as those indicators most likely signal potential impacts on your business and position in the economy.

Strategy Plan One

http://strategyplanone.com

Business information, resources and tips for the entrepreneur

© 2012 Strategy Plan One