The most consequential moments in any business are the decisionsânot the execution that follows, but the calls you make when the path forward isn't clear. I've made dozens of significant decisions over the years: which products to build, which opportunities to pass on, which people to bring onto a team, how to respond when things weren't working. Some of those decisions were good. Some were clearly wrong in hindsight. And the difference between good and bad decisions often had less to do with the quality of information I had at the time than with the process I used to make the call.
Good decision-making is a skill, not a talent. It can be practiced and improved. And the most important component isn't access to better information or more analysisâit's having a framework that helps you separate the decision from the outcome, learn from both, and avoid the common traps that make otherwise smart people make consistently bad calls.
The Trap of Outcome-Based Reasoning
The most common error in evaluating decisions is judging them by outcomes rather than by the quality of the decision process at the time. A good decision can have a bad outcome due to factors outside your control. A bad decision can have a good outcome through luck. If you reward or punish yourself based on outcomes, you end up reinforcing some behaviors that workedć¶ç¶ and punishing behaviors that were actually correct given the information available.
The practice I use is to write down my reasoning before I make any significant decision: what I'm deciding, what information I'm weighing, what I expect to happen, what alternatives I'm considering and why I'm rejecting them. Then, after the outcome is known, I review my reasoning separately from the result. Did the things I expected to happen actually happen? Were there factors I didn't consider that turned out to matter? This creates a learning loop that improves future decisions regardless of any individual outcome.
The Difference Between Decisions and Outcomes
Most decisions involve uncertainty about the future, which means outcomes are never fully within your control. A sound decision process should consistently point you toward good outcomes over time, but any individual decision can go either way. The goal isn't to make perfect decisionsâthat's impossible given real uncertainty. The goal is to develop a process that makes sense given what you know at the time and that you can learn from afterward.
Try the Decision Matrix tool to structure your next important decision before you make it.