This topic came up several times this week in lot’s of different contexts. It really is so important that we don’t allow emotion to interfere with business operations. This concept goes for sports too. The problem with being emotive is that it can really cloud judgment. It can also have an adverse effect when making decisions or negotiating.
Would you drive a car at night across twisty wet roads if you were super hungry and completely exhausted? Of course not — the risks of having an accident would be way too high. You certainly wouldn’t want to be playing sport when your energy levels are completely deplete either. In that instance your chances of doing something stupid resulting in letting your team down, or worse still, picking up an injury increase in such circumstances.
So why then would you make a critical business decision? As an exercise, this week I decided to write down the 10 biggest decisions that I’ve made over the last 12 months. Next I wrote down to what extent they were influenced by emotion. I then wrote down how my energy and stress levels were at the time of making those decisions. I was then able to rank these elements and graph them.
No prizes for guessing the results… My best decisions (as measured by their outcomes) were made at times when I was well rested, fed, hydrated and in a physically good state of fitness. There were a couple of outliers whereby I’d been sleep deprived by the underpinning decision making then had been underpinned by a sound evaluative process that had been worked out during rest times.
So what can be learned from this retrospective analysis. Two main things:
1. Avoid making decisions when you are cold, wet, tired, hungry, etc.
2. Develop SOP’s (Standard Operating Procedures) that can be deployed automatically in circumstances of stress.
An example of such an SOP is pricing. Figuring out pricing of a service, whether your an graphic designer or a plumber should be done at a time when you are in good form and not under pressure. Figuring out how much you should charge should be a function of a number of elements, e.g., f(market + time + education + costs).
There will always be variable elements in projects so you’ll also have to legislate for how best to factor these into your decision making process. The key takeaway I want to impart here is that making a decision about something as important as pricing (i.e., how much you should charge for providing a service) should be made scientifically and in advance of having a pricing conversation with a client.
Applying (and then mastering) such quantitate analysis will help you to remove emotion from the process so that you avoid all the stress and self-doubt that can otherwise so easily creep into a negotiation. Pricing is just one example here — you’ll be able to design and deploy similar formulas to other areas of life and business that involve critical decision making too.
Next week I’ll be writing on the specific subject of valuing oneself so keep an eye out for that. Let me know in the comments if you’ve got a question about anything I’ve discussed here or have any ideas for subjects that you’d like me to write about over the coming weeks. If you’re enjoying reading these posts then do please hit that like button or share with your network!