Running a business is a complicated undertaking. Being in a decision-making capacity of any kind – a manager, board member, or perhaps a trusted and influential investor who’s close to the CEO – means making decisions every day that could affect the success of a business and through that the lives of your customers and the long term future of your job and everyone else who works for you. Not doing your due diligence on an important contract or failing to investigate the background of a potential partner or hire could result in heavy financial losses, a hit to your business brand or reputation, or getting dragged into costly legal action.
Making good decisions is, therefore, one of the most important disciplines in business. Good decisions require data: objective information (or the closest thing you can get to it) about the question you are facing. Too much attention is given to the literature and culture surrounding business confidence and bullishness. Those two qualities are of course important for success: if you don’t feel confident about your abilities, you wouldn’t be able to honestly recommend your service to anyone or stand by the decisions you’ve taken. If you’re lead entirely by them, however, you’ll find yourself making decisions lead by your heart – what you want to be true – rather than a real understanding of the facts. Sometimes the facts simply aren’t in your favour and if you’re not able to recognise that and change your plans accordingly, then you’ll run into trouble.
The key to success is research: dispassionately framing the right questions that can get you the insight you need to make a plan that will work for your business.
For example, if you’re planning to try to break into a foreign market, you need to invest in some international research that covers all aspects of your proposed expansion. The initial research will simply help you define what you don’t know and need to find out, with later parts filling in those blanks, from the rules and regulations surrounding importing goods into that market, the trends and forces that animate the customers there and the tax implications for your business whengenerating revenue there. You should make your detailed plans after you get the answers from the experts you’ve tasked with the research: let facts lead your planning rather than looking for facts to manipulate into your plans.