“Decision Making”, “Problem Solving”, “Innovation” … We all hear these words in our business every day. But what does it all mean? And how do they fit together?
These are all about answering the question: “what should we do next”.
And the title to this post is no accident: when it comes to decisions in business, there are three distinct types.
The first step is to determine what type of decision you are making.
Strategy describes the things that you want to achieve and how you intend to achieve them.
A strategic decision makes a fundamental change to the company. A strategic change affects goals, resources, priorities, and people.
An example may be to launch a whole new product or service. Another could be going after a new client type. Or creating new job role.
What these scenarios have in common is that they are creating permanent change to your business.
They affect everything that comes after them. It will move resources from one area of the business to another; and it will require new processes or new people.
Tactics describe what you need to do to achieve those goals, as determined by your strategic decisions.
Tactics are the plans through which you achieve those goals. They determine what you do and what you measure.
Here you can start to determine how you want to do things; in terms of actions, yes, but also behavior, personality, and quality.
What you decide here will still affect what comes after, but in a different way. A change in tactics does not affect the strategy or business goals; only the methods you’re using to achieve those goals. The changes are internal and will affect a part of the day to day operations.
Operations are essentially your business tasks.
As determined by your tactics, operations is what you come into the office and do every single day.
Day to day operational decisions do not impact what came before or what comes after.
Yes: you could say that any change affects what comes after. It does not, however, change the overall direction or list of priorities a business has.
An operational change is caused by a change in strategy, or a change in tactics, or, more simply, an improvement in operational efficiencies.
Make decisions in context
When you confront a new decision – whether it is to solve a problem or to launch a new initiative – start by determining if you are dealing with a strategic, tactical or operational decision.