How to Build a Decision-Making Rhythm for Your Business

Research & Sources / Leadership & Decision-Making

A healthy heart does not beat in wild bursts and then stop for a while. It beats steadily, in a rhythm, day and night. That rhythm is what keeps the body supplied. Many businesses make decisions the opposite way: nothing for weeks, then a panicked burst when something goes wrong. A decision rhythm gives a company a steady heartbeat.

Decisions without a rhythm

In many growing companies, decisions happen whenever someone catches the boss in the corridor. Questions pile up in inboxes. Important topics are discussed in three different meetings, and decided in none. Then a deadline arrives and everything is decided at once, in a rush, by whoever is in the room.

McKinsey surveyed more than 1,200 managers about decision making. Only a small minority said their organisation was excellent at it, and many said much of the time they spent on decisions was used ineffectively.¹

Why process matters

It is tempting to think good decisions come from smart people and good data. Research suggests the process matters even more. A study of more than 1,000 business decisions by Dan Lovallo and Olivier Sibony found that the quality of the decision process had about six times more effect on outcomes than the quality of the analysis.²

A rhythm is the simplest kind of process. It makes sure the right questions are asked at the right time, by the right people.

A simple three-beat rhythm

Weekly: the short beat. Thirty to sixty minutes with your key people. Look at a few numbers, see what is stuck, decide the open operational questions. Anything that can be decided now, is decided now.

Monthly: the middle beat. Half a day or less. Look at the bigger trends: sales, cash, hiring, key projects. Decide on adjustments: more effort here, less there.

Quarterly: the deep beat. A day away from daily business. Review the main outcome of the last quarter, choose the main outcome for the next one, and decide what you will stop doing.

Rules that make the rhythm work

• Every topic has a home. If a question comes up in the corridor, the answer is “let’s put it on Thursday’s list” (unless it truly cannot wait).
• Decisions are written down. One line each: what was decided, who does it, by when.
• The agenda is built from open decisions, not from status updates. Updates can be read beforehand.
• Disagreement is welcome before the decision, and commitment is expected after it.

The calm that follows

Once a rhythm runs for a few weeks, something interesting happens. Interruptions drop, because people know when questions will be handled. Decisions get faster, because they are not waiting for a free moment in the boss’s calendar. And the leader’s mind gets quieter, because open questions have a place to go.

What this means for you this week

• Book a recurring weekly decision meeting of 45 minutes.
• Collect every open decision into one list and bring it to the first meeting.
• Start a decision log: one line per decision.
• Put the next quarterly day in the calendar now.

Strong businesses do not run on adrenaline. They run on a steady beat.

Sources

1. McKinsey & Company (2019). Decision making in the age of urgency. mckinsey.comSurvey of 1,259 managers: only 20 percent say their organisation excels at decision making, and most say much of their decision time is used ineffectively.
2. Lovallo, D. & Sibony, O. (2010). The case for behavioral strategy. McKinsey Quarterly. mckinsey.comStudy of more than 1,000 major business decisions: the quality of the decision process mattered about six times more than the quality of the analysis.