5 Questions to Answer Before Making a Big Decision
CEOs and other execs earn their keep through strong decision making. Here's a process for doing it reliably.
In Ancient Greece, when an important person had a heavy decision to make, they would head over to the Temple of Apollo at Delphi.
There, they could consult the famous Oracle of Delphi. She would listen to her petitioner’s dilemma and, by some reports, enter a frenzied state after inhaling vapors emanating from a rift in the temple’s floor.
(The whole thing about the vapors was long thought to be mythical, until geologists and archaeologists found actual fissures in the “oily limestone” beneath the temple.)
Deep in her trance, the Oracle would give you what you wanted: an answer straight from the gods.
To which many a CEO would say: Must be nice!
For better or worse, the CEO is the ultimate decision maker for the organization. It’s a burden that sometimes feels as heavy as Atlas’s, and we have no vapor-drunk oracle from whom to get divinely sanctioned guidance.
When the organization faces its biggest tests, it’s up to us to make the calls. And if it’s the wrong decision, guess whose fault it is?
This pressure can lead to all sorts of dysfunction from the CEO:
Trying to get everyone in the company to approve of your decision before you make it
Sitting on the decision forever
Trying to micromanage ALL the decisions, even ones your employees should be making (often leading to broken-stoplight decision making)
Placing blame on others when a decision turns out to have been the wrong one
On and on.
It’s probably good there are no intoxicating vapors wafting from a crack in your office floor, but it’s tempting to want an easy way out of the hard decisions. Maybe we could just rely on our intuition entirely? Trust our guts?
Sadly, no. The leaders who do that have convinced themselves they are far smarter and wiser than they actually are.
What you need is a good process.
This is a vast topic on which entire bookshelves have been written. However, one simple way to think about great CEO decision making is to ensure you have answered five key questions. They are as follows:
1. Is it my decision?
Not every decision belongs to the CEO. Trying to control every choice in the organization leads to bottlenecks and disempowered teams.
I use a mental model that distinguishes whether a decision is “above the waterline” and “below the waterline” to decide who should own it.
Above-the-waterline decisions are low-risk and won’t sink the ship if they go wrong. These should be delegated to capable team members to build trust and free up your focus.
Below-the-waterline decisions, like major strategic shifts or high-stakes financial commitments, demand your direct involvement. Knowing the difference keeps you from micromanaging while ensuring you’re hands-on where it counts.
2. Is the decision reversible?
Jeff Bezos’s framework of Type 1 and Type 2 decisions is an indispensable guide for CEOs. Type 1 decisions are high-stakes and often irreversible, like acquiring a company or launching a new product line (they’re usually below the waterline). These require deep analysis and careful thought.
Type 2 decisions, like testing a new marketing campaign, are reversible and can be adjusted later. They may be above or below the waterline, but are often the former.
Move fast on Type 2 decisions to maintain momentum, but slow down and dig in on Type 1. Misjudging this can lead to either reckless moves or paralyzing overanalysis.
3. Am I thinking within the proper model?
Every decision impacts your organization’s three core stakeholder groups—shareholders, employees, and customers. My leadership model emphasizes balancing their interests to find the white space between them, where the right decision lies.
Neglect one group, and you risk long-term damage. For example, cutting costs to please shareholders might hurt employee morale or customer satisfaction.
Equally important is avoiding common decision-making traps, like the 4 “Villains of Decision Making” outlined in the book Decisive. They are:
narrow framing (artificially limiting your options)
confirmation bias (seeking only supporting evidence)
short-term emotion (letting fear or excitement cloud your judgment)
overconfidence (becoming too sure of yourself and your beliefs)
There are so many more decision traps—basically faulty mental models—but starting with these four will cover a lot of territory.
4. Who needs to be involved in the decision?
No CEO should listen only to their own counsel, but trying to get EVERYONE’S approval is a recipe for gridlock. Consult key stakeholders (your leadership team, subject-matter experts, or even a trusted board member) but don’t chase consensus. Input sharpens your perspective, and a devil’s advocate can expose blind spots, but the final call is yours.
Note: Be cautious about involving the board unless you’re prepared to follow their guidance. Asking for advice you don’t intend to take opens a whole can of worms no CEO wants. Trust me.
“Experiments show that group decision-making grows less effective in assemblies of more than six.” —Peter Watson
5. How should I communicate the decision?
Once you’ve made the call, you need to communicate it clearly and confidently to the organization. For big decisions, work with your executive team on a plan for communicating the decision fully and consistently. Every corner of the organization should get the message, and not just once in an email.
Explain your rationale, not to justify yourself but to show your reasoning and build alignment.
How did the overarching company strategy influence your thinking?
What differentiating core values does this decision align with?
What other options did you consider?
How will this decision be monitored to ensure it was the correct one?
Transparency on all these things prevents confusion and rallies the team around the mission.
Even those who disagree should understand why you chose the path you did. Ask for their commitment to execute, emphasizing that buy-in doesn’t mean unanimous agreement (i.e., ask them to disagree and commit).
The philosophy professor Gordon Graham once said, “Decision is a sharp knife that cuts clean and straight; indecision, a dull one that hacks and tears and leaves ragged edges behind it.”
By consulting these questions each time a big decision lands on your desk, you can not only cut clean and straight but feel confident you’ve got a good chance of making the right decision… no vapors needed.