The CEO’s Guide to Making Tough Executive Decisions
In “Make BIG Happen,” CEO Coaching International Founder and CEO Mark Moses writes, “The typical CEO probably makes only three or four decisions per year that really matter. True, they are called upon to make decisions every day– but do those decisions move the ball? What matters are the BIG, strategic decisions, the relatively rare ones that chart a company’s course, that fulfill its vision.”
The next time your company’s very future is on the line, work through this six-step process to sort through all your options and arrive at the best decisions for accomplishing your BIG goals.
1. Gather data.
The info you’ll need to make tough executive decisions will come from many different sources, including market research, financial analysis, customer feedback, industry trends, and your AI flywheel. By grounding your decisions in hard data, your personal biases and blind spots will have a harder time overwhelming the facts of your situation.
However, that doesn’t mean emotional data has no place in decision-making. CEOs have to exercise high-EQ leadership, especially when it comes to personnel decisions or major pivots that could force you to adjust your vision for the company. Finding that ideal balance between the head and the heart is a skill that can take a lifetime to master. When you’re working with an experienced CEO coach who’s had to navigate countless tough decisions throughout their own career, you’ll have access to one more key data point: an expert opinion you can trust.
2. Solicit diverse input.
One essential key to achieving buy-in on an executive decision is to make key stakeholders feel like they had their say. As appropriate, consult with your board, c-suite, family founders, banker, and suppliers, as well as lower-level employees and customers who will have to live and work with your decision on the ground floor. Think of these viewpoints as more valuable data that might shed light on your blind spots or open your eyes to an unexpected consequence you haven’t gamed out. Not only will you ultimately arrive at a better decision, you’ll also be reinforcing a culture of open communication where people feel comfortable sharing their thoughts and ideas.
3. Align with your vision and values.
“What decision do my vision and values tell me to make?”
That’s the question a CEO Coaching International client had to ask recently after a team leader made a personal social media post that offended some members of the company. After gathering all the data, our client determined the leader had misclicked and made an honest mistake. Input from key internal stakeholders was still divided between employees who wanted the leader fired and employees who wanted to forgive and move on.
Our client chose the latter. The company’s vision required effective leaders at every level, which this employee was. And “One strike, you’re out” wasn’t consistent with the company’s values of teamwork and inclusiveness.
By staying true to your vision and values, you can ensure that your decisions are always consistent with your organizational culture and purpose. You’ll need that alignment later in this process when it’s time to execute your plan and create sustainable forward momentum.
4. Mitigate risk.
“A crisis communications plan is like insurance,” says crisis expert Evan Nierman. “You don’t wanna spend your money on it, but when you need it, you’re damn sure glad you have it.”
CEOs who have done the advance work of identifying the company’s vulnerabilities and systemizing their crisis response can insulate tough decisions from some risks. You can also put that plan into action at a moment’s notice if a misguided marketing campaign or tweetstorm from an ex-employee opens you up to a cancel culture attack.
Long-term strategic decisions, such as buying a distressed competitor or pivoting into a new market, carry their fair share of risks too. Take stock of your financial resources, core competencies, talent pool, and customer base. Analyze how various decisions and potential outcomes could risk destabilizing one of these pillars of your business. If some short-term damage is inevitable, circle back to your crisis management plan and prep to minimize the fallout and move forward quickly.
5. Communicate and execute.
Once you have made a decision, it’s crucial to communicate it clearly and effectively to all stakeholders. Provide a rationale for your decision and explain how it aligns with the company’s vision and values. Use your regular meeting rhythm to reinforce your message at every level of the company. Address any concerns or questions that may arise. Assign clear responsibility for executing specific parts of your plan and establish timelines. Monitor progress regularly and provide ongoing support and guidance to ensure the whole team follows through on what you’ve decided, despite any reservations that were raised at the input stages. At this point, we’re past respectful disagreement: anyone who can’t “disagree yet still commit” might not have a spot in this next evolution of your company.
6. Review and adjust.
Even when the CEO arrives at the correct decisions, it’s doubtful that the path taken was perfect.
Once the dust settles, sit down with your c-suite and your CEO coach to review the first five steps of this process. Ask yourself what went right and what went wrong. Identify key stakeholders who should have been included in the decision or whose voices should have carried more weight. Pinpoint the blind spots you uncovered that you want to permanently eliminate. Plan to shore up any lingering inefficiencies or deficiencies in the company that this decision revealed.
Above all, be open, honest, and humble. There’s no way to predict when the next tough decision will land on your desk. Your commitment to continual learning and improvement will help you keep choosing wisely and keep Making BIG Happen.
About CEO Coaching International
CEO Coaching International works with CEOs and their leadership teams to achieve extraordinary results quarter after quarter, year after year. Known globally for its success in coaching growth-focused entrepreneurs to meaningful exits, CEO Coaching International has coached more than 1,000 CEOs and entrepreneurs in more than 60 countries and 45 industries. The coaches at CEO Coaching International are former CEOs, presidents, or executives who have made BIG happen. The firm’s coaches have led double-digit sales and profit growth in businesses ranging in size from startups to over $10 billion, and many are founders that have led their companies through successful eight, nine, and ten-figure exits. Companies working with CEO Coaching International for two years or more have experienced an average revenue CAGR of 31% (2.6X the U.S. average) and an average EBITDA CAGR of 52.3% (more than 5X the U.S. average).
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