Recently, I came to a conclusion after reviewing a management report. After talking with a field manager, I came to a different conclusion. My new conclusion did not contradict my analysis, but the conversation enriched it. In the end, we arrived at a far better conclusion. Upon reflecting on this anecdote, I developed the following checklist for making decisions:
Analyze. Management reports are vital to company growth and success. Unfortunately most companies suffer from report creep. Someone wants this and that analyzed, or someone wants to evaluate a new metric. And, voilà, a new report is created. Even though a good accounting department can create a dynamic report that upates automatically, it may not add value, it may never be looked at again, or may cause the undisciplined to lose focus. In general, we don't need more reports, we need to better use the ones we have. Focus on the few metrics that measure success. What gets measured gets done.
Ask. There is no such thing as a stupid question. But there are stupid people asking questions. Do you homework before you ask. Nothing destroys credibility and authority faster than incompetence. When developing questions to ask, start with broad, open-ended questions and continuing narrowing the questions. Allow the conversation to take a few tangents, but not too many. The conversation needs to stay on target, concise, and productive. However, there is tremendous value in informal, impromptu dialog. What gets asked gets accomplished.
Listen. Listening is a leader's most powerful and underutilized skill. Yes, listening is a skill that can be practiced and developed. We have two ears and one mouth so we can listen twice as much as we speak. Instead of formulating your response as the other speaks, digest not only what you hear but what you don't hear. Listen intently for any underlying meaning or hidden agenda. Repeat what your heard in your own words to ensure you are on the same page.
Discern. Is this consistent with both my personal vision and company vision? Is it the right thing to do? Does your conversation support or contradict your analysis? If it contradicts, you may need to revisit the numbers and/or ask others. Here is where CFOs can improve their leadership by becoming quicker at reaching a decision. We have a tendency to continue drilling down until we reach absolute certainty, but we must make decision before absolute certainty. Is that point 95% certainty? 90%? 85%?. On the other hand, companies need our level-headed depth to make better decisions. We cannot go to the other extreme of knee-jerk reactions
Decide. Be decisive. Don't waiver. Follow through. Execute. Be consistent.