Have recent events caused senior leaders to lose their confidence that they’re making good business decisions? A recent study of leaders in companies in the UK and continental Europe looked at this question–as well as many others. The answer? Yes, COVID-19 has caused a lack of leadership confidence, a worrying breakdown in leadership decision-making, and an increase in FOMU, or “fear of messing up.” These are just a few of the findings of a recent Treasure Data report, “Better Business Decisions In the Age of Unpredictability.” Perhaps the most important question that the report asks is: What can leaders do to improve the processes behind making the data-driven business decisions that matter?
More than three-quarters of business leaders from medium and large sized businesses (77%) say that since the start of the pandemic, they feel more pressure to make the right decisions quickly, compared to 61% of leaders at significantly smaller businesses. Decision-making has become more complicated than ever, especially for larger organizations (65% for medium and large businesses vs. 54% of smaller businesses).
These factors aren’t just causing stress for bigger businesses. They are leading to mistakes. too. While just 23% of small and micro businesses say they frequently make the wrong decisions, this figure almost doubles (41%) for medium and large companies. “More complicated decision-making processes are causing stress and leading to mistakes,” the study’s authors write.
Business leaders know that the problem is serious. Almost half (47%) say their decisions have not improved recently, and 7% say they’re worse, despite more time spent deliberating.
Could Better Data Help?
Could these mistakes be avoided if organizations were harnessing data more efficiently? It’s possible. Unfortunately, not all businesses are doing everything they can to make more data-driven decisions. At least one in ten businesses surveyed admit that they aren’t collecting sales or customer data well, if at all. However, on the whole, bigger businesses are better at collecting data than their smaller counterparts, as we’d expect.
The COVID Pandemic Is a Major Complicating Pressure on Execs
Over the past eighteen months, businesses have been forced to make a multitude of decisions at speed and under pressure. Not all of these decisions or strategic dilemmas have been new; in many cases they are decisions we have always faced, but the surrounding conditions, as governments, economies and consumers recoiled from the impact of COVID-19, were profoundly altered.
Within this new context, decisions have taken on strange dimensions. “Long term planning” used to mean three years, but as fresh variants of the virus emerge, it can mean all of three weeks. Likewise, the ‘how-should-we-price-this-range’ decisions, the ‘how can we make our customers love us more’ decisions: these, and many other business-critical choices, must now take account of this uncertain environment, in which modes of thinking and patterns of behaviour can and indeed do change overnight.
This doesn’t just translate to more stress on the shoulders of business leaders, but to real business challenges. An inability to make the right decision with confidence and speed can lead to an organization missing the opportunity to discover new customers, losing sales to those who could pivot faster, getting the price wrong and being left on the shelf whilst competitors reap the rewards of a connected decision.
The world today feels very different. Not only are customers unpredictable; buffeted from all sides, but our supply chains are also unpredictable, as are retail environments. Perhaps the only certainty left is that this shifting, unpredictable landscape will continue to fracture and adapt. And that the only thing that helps is still a necessity when it comes to supporting decision makers in their critical decisions and in their leadership roles.
The Better Decisions report reveals how leadership decision-making has changed in the wake of the pandemic, and provides business leaders with the necessary insights to begin making better decisions. If COVID-19 has left many in business reeling, their well-laid plans and processes in disarray, this is the first step towards a renewed confidence to thrive and regain customer centricity.