5 Essential Tips to Avoid Decision Making Bottlenecks in Your Small Business

5 Essential Tips to Avoid Decision Making Bottlenecks in Your Small Business

Decision making bottlenecks are much more of a reality in a small business than they are in an established, well structured medium or large sized entity. This is because small business management is less organised, and the decision making protocol is often ambiguous and ever-changing.  In many small businesses, employees aren’t given any leeway toward making even the smallest decisions, whereas managers can be given way too much responsibility and veto power when the “crap” hits the fan.

The real trick to avoiding decision-making-related problems is finding the middle ground — that point where the people who work for you have enough power to make sensible decisions in your absence — or simply to make decisions without involving you or their immediate managers — in order to keep the gears turning without interrupting the ebb and flow of your business.

Here’s 5 tips you can use to successfully manage the decision making protocols in your business:

1. It all starts with recruiting the right people.

Looking for the best and brightest will definitely add time to your recruiting campaigns. Consider first that you’re a small business. Bad hires do happen, but they happen more often when owners and their management team are in a rush to fill slots.

Look for people with a history of above average performance in the duties you’ll need them for, and most important; vet them first by talking to their references, then screen for the best and brightest by giving them an in-office aptitude test to assess their ability to work in your unique business.

Avoid decision making bottlenecks by hiring the right people.
Image Credit: Gangplank HQ/Flickr

2. Reduce decision making bottlenecks with well defined job descriptions for each employee.

After all, how will they know whats expected of them when a specific decision needs to be made? Many decision making bottlenecks result from employers having expectations that the employee is not aware of, including what decisions they should be making on their own and which they should not.

Each tailored description should include how they should deal with the most typical sales and service scenarios, escalation procedures, manufacturing snafus, etc., and what they’re expected to do throughout the day (eg., essential tasks, cold-calling, general maintenance, etc.)

3. Avoid decision making issues by addressing problems as they occur.

Sally approves a 20% discount on a high-dollar item without your approval. Derrick causes your best client to go elsewhere because he couldn’t approve a 5% loyalty discount when their contract came up for renewal…

When these issues happen, sometimes consequences occur that cannot be reversed. However, they’re easily avoided by addressing them and setting expectations for the future. Without reprimanding the offending party in front of the group, sit your team down briefly and politely describe why the decision should or should not have been made without management’s input.

4. Cross-train employees in anticipation of employee absences.

It’s important to consider what happens when an employee can’t be at work to do their job — for a day or two, or an extended period of time. Cross-training employees across different positions helps to avoid one of the biggest hiccups afflicting small business owners — the dreaded “I don’t know what to do, so-and-so usually does it” melee.

This is, of course, easier said than done in a lot of business structures. However, even if you can’t teach a production team member how to be an electrician for the day, you can still have qualified personnel teach them what to do in the event of common pitfalls or downright emergencies (ie., how to turn off the main circuit breaker, how to turn on backup systems, who to call, etc.)

Image Credit: Jesse Moore/Flickr

5. Identify situations where you can empower your employees to make decisions.

If you’re a hard-line OCD-type of owner, this is going to be hard, but it’s essential to your employee’s and your own mental health. Identifying scenarios where your employees can make decisions without their superior’s input is crucial to a well-run operation, too.

I’ll give a great example of a recent experience I had with a store run by someone who refused to let his employees use their brain to give customer’s the service they deserved:

  • I purchased an electronics device from a storefront business back in March. A week later that device stopped working, I went to the store for a replacement on the weekend, and was told I would have to wait until the owner came back on Tuesday (three days later). This guy is competing with the big box takeover which is afflicting small businesses globally, and his employees can’t do exchanges on obviously defective merchandise?

After two years in business, he closed his doors last month — very likely a portion of that failure was do to poor service resulting from situations like I just described.

Takeaway:

No matter how you look at it, the vast majority of decision making bottlenecks in a small business occur because of poor management. Having a plan in place for how employees are expected to act in various situations is key to avoiding the often costly consequences that come from too much, or a lack of, decision making power.

Main Image Credit: L.K./Flickr

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