Making “Better” Decisions (and not just more decisions)

Last night was another one of those nights when I woke up at about 3:00 am and started thinking about everything but sleep. This doesn’t happen all of the time, but it has always happened through my 42+ years of work, especially since I have had my own business for the last 18 years.

If you have to make decisions for your business, and if you own your own business or lead a business, you too have these kinds of nights. While laying there this morning I started to wonder just how many decisions an average person makes in a day and more so, how many decisions a CEO will make in a given day. The numbers may surprise you, or then again they may not. Let’s read on to learn more.

My initial research dove into how many decisions the average person makes in a day. This is the number that shocked me, but then again, it seems plausible. Research from many sources shows that an average person will make from 35,000 to 37,000 decisions each day. These really get into the weeds and include things regarding what you will wear, what you will eat, and how you choose to drive, ride, or walk to work (or bike). When you look at this level of decision making I can see getting to that large number very easily. Thinking about that gives me brain fatigue and it supports other research that shows people can only make so many decisions before the quality of their decisions will decline. I’ll talk about that more in a future post.

Another snippet of research that makes total sense is group decision-making. The research from Bain shows that decision-making accuracy declines by 10% with each member over 7 in a group making the decision. Think about that. If you ever wondered why groups break up into committees, this research supports that data. It also makes me wonder how we have survived in a representative democracy with so many elected officials at the local, county, state, and federal levels. This only supports the old axiom that “too many cooks spoil the broth”.

Since much of my work is with business leaders and CEOs I next thought about how many decisions the average CEO (if there is such a thing) makes in a day. Elon Musk has been quoted that a good CEO should make about 3 decisions a day. That may be true if you lead a very large organization where you are isolated from much of the day-to-day fray. The Strategic CFO has a 7-step process they espouse to reduce the number of decisions a CEO has to make. That process includes:

• Identify the decision
• Gather information
• Identify potential options
• Weigh the evidence
• Choose a path
• Take action
• Evaluate the decision

If I haven’t confused you enough, there are other factors to consider. The “age and stage” of an organization will play a large role in the number of decisions the CEO makes. In addition, the style of the CEO will also influence this number. In Vistage, we work with CEOs to help them work “on the business” instead of “in the business”. By working on the business the given CEO will be drawn into fewer decisions and they will put a team into place that can handle more of the downstream decision-making.

Thinking about all of these decisions gives me a headache. Come back next week and I’ll share more about decision fatigue.

How many decisions do you make in a day?

Which of these decisions is better handled by someone else?