HOW TO MAKE BETTER BUSINESS DECISIONS
By Ron Hirsch CEO Leaders Forum Pty Ltd

Making good business decisions is your most important job – and your riskiest.

The outcomes of your decisions can impact your company’s profitability and viability either negatively or positively. Your decisions can also affect your employees and related parties such as suppliers, customers and other service providers.

Think of the implications of the decisions made recently by some of our leaders:

• • The Rudd government’s decision to introduce the mining tax.
• • Telstra’s decision to join the Governments National broadband initiative.
• • Australia’s decision to bid for the 2022 Football World Cup.

History will judge the wisdom of these decisions.

Where do bad decisions come from? Mainly from distortions and biases and a whole series of mental flaws that distort our thinking. These psychological traps are unconscious but we can learn to be alert to them and compensate for them.

How can we improve our decision making processes and what pitfalls should we be looking out for? The main hidden traps in decision making have been revealed by John Hammond, Ralph Keeney and Howard Raiffa in their Harvard Business Review article and are excellent reference points for improved decision-making.

Anchoring Trap
Giving disproportionate weight to the first information you receive.

• Avoiding the Trap
• Pursue other options in addition to the first one.
• Seek information from a variety of people of different backgrounds and experience to your own.

Status Quo
Favouring alternatives that perpetuate the existing situation.

• Avoiding the Trap
• Ask is the status quo really still relevant?
• Would you choose the situation if it was not the status quo?
• Give less importance to the cost of switching from the status quo.

 Confirming Evidence
Seeking information that supports your existing point of view.

• Avoiding the Trap
  
• Ask respected peers to challenge your decision.
• Avoid yes men/women.
• Check whether you are taking an unbiased view of all relevant facts.

Estimating and Forecasting
Be realistic when compiling forecasts and estimates.

• Avoiding the Trap
  
• Consider extremes and then challenge those extremes.
• Get actual statistics not just impressions.

I have always followed two principles in my decision making whether business or personal:

1. 1. Not to make too many major decisions at once. Business Owners often face many major decisions at the same time and this happens usually by the prevailing circumstances rather than by design. Prioritise and deal with each decision sequentially and separately as much as possible
2.  
3. 2. Try and uncover errors in thinking based on emotional considerations before they become errors of judgment. Use the above tools to assist you to improve your decision making.

Ron Hirsch CEO of Leaders Forum Pty Ltd - A network of business owners who meet regularly in an informal and friendly environment to exchange ideas, pursue learning and share growth strategies.
http://www.leadersforum.net.au
ron@leadersforum.net.au 
 

Decision making is the cognitive process leading to the selection of a course of action among variations. Every decision making process produces a final choice. It can be an action or an opinion. It begins when we need to do something but know not what. Therefore, decision making is a reasoning process which can be rational or irrational, and can be based on explicit assumptions or tacit  assumptions. - Wikipedia

General Ledger Report Batches
Reports > General Ledger Reports > Setup GL Report Batches

The GL Report Batches utility enables multiple GL Reports to be batched together and scheduled to run at a convenient time. A GL report batch could be a collection of different reports such as P&L and balance sheet, but may also include repetitions of the same report with different parameters. An example of this repetition could be multiple occurrences of P&L by branch report where there is one for each branch.

Batches can be run via the user interface or run from a command line prompt. The latter allows scheduling of a batch using an external scheduler such as the “AT” command provided with Microsoft Windows. The batch can therefore be run with no user interaction.

GL reports may also be directed to file rather than printer. For example, they may be written directly to PDF files for publication to Adobe Acrobat reader.
The system automatically takes care of any output dialogues to achieve this, and so can be run without user interaction.

Kilimanjaro Scan-Pack and On-Line Ordering

1) Kilimanjaro Scan-Pack is a simple way to verify that stock items going out the door are indeed the items on the order. This application can be hooked up to a large display in the warehouse or simply to a monitor. A list of orders released for dispatch will appear on the screen. Scanning the order number will bring up order, and show the released order lines. Then, scanning the barcode on the actual item will verify if this matches the item on the order. If it matches, a sound is heard and the button goes green. If not, a warning sound is heard and the button goes red. The system can be configured for a second scan to record serial numbers if required. Not only does this system manage the scan-pick verification, but it is also configured to manage the priority sequence in which orders are dispatched. For example, orders with the same courier flagged can be picked to be ready in time for the courier pick-up. The system can be used in conjunction with Kilimanjaro's Business to Business Web Ordering system called Dealers On-Line, or can be used with your standard EXO system.

2) Kilimanjaro Dealers On-line. We have had a tremendous response to our Web based Business to Business Application, which we are promoting again this month. The application gives your agents, dealers, customers or sales reps the ability to enter sales orders on-line and in real time. Stock quantities are also real time, and you can view the incoming stock schedule if requred. The system means that you are open for business 24 hours a day, 7 days a week, and is guarateed to save you at least 1 person keying in phone or faxed orders.

Please contact sales@k-c.com.au for more information or a demo of either of these two products. Our customers have achieved unbelievable improvements in efficiencies in stock based businesses by using one or both of these systems.