Everyone has made at least one bad decision in their lives. Some decisions are worse than others, though. And while humans are imperfect, bad decisions can be avoided.
That’s good news for businesses, because the ramifications of a bad decision can be huge. But, bad decisions don’t come out of the blue. There’s groundwork that employees and executives lay for themselves. Read on to learn one of the top causes of bad decisions and how you can avoid it.
There are a number of causes of bad decisions, though in this post we’ll talk about one in particular. Incorrect and inconsistent data lead to poor decision making. So, how does this situation develop in the first place?
Again, this is a problem with more than one cause. That being said, one reason for inconsistent and incorrect data is that there’s more than one version of the truth.
This isn’t such a difficult scenario to imagine, and it’s quite common. At many companies, more than one person keeps records or manages data sets. That leaves plenty of room for error. Perhaps one person measures metrics differently than another, or someone copied and pasted information from one source and figures weren’t captured properly. Regardless of the cause, inconsistent and incorrect data sows confusion and contributes to poor decision making.
We’ll illustrate with an example.
John and Jane are salespeople at an office furniture company. They’re each responsible for tracking their sales because there’s no single system into which they can input their results. Jane knows that John has only made eight sales in the past three months, even though he’s recorded that he’s made 12 sales in a spreadsheet. She’s made 10 sales this quarter.
At the end of the quarter, John and Jane submit their sales figures to Jim. Jane talks to Jim privately, mentioning that John’s figures aren’t completely accurate. When Jim confronts John, John swears up and down that his spreadsheet is the absolute gospel truth. John is very convincing, and Jim believes him over Jane.
One salesperson’s fudged numbers aren’t necessarily the end of the world, but what if several of John and Jane’s colleagues are also recording incorrect figures? And what if Jim believes them over their more truthful co-workers? With this erroneous data, Jim could go to the upper management and declare that the company is ready to expand into a new market based on its sales.
Let’s say the executives act on Jim’s advice. The real data doesn’t support that decision, and it costs the firm a great deal of money as well as causes damage to its reputation.
There’s a way to prevent this situation from taking place: implement a single source of truth. There won’t be any questions or conflicts about data.
More importantly, you can rest assured that you’re making the right decisions – they’ll be based on accurate, consistent data.