Business success (or failure) is a reflection of owner decision making. While many factors may lie outside of your direct control, you still decide how to respond to them. An owner’s absolute authority to choose what to do is the single greatest shaping influence on the future of any business.
Most business owners spend almost all of their time making operational decisions. These concern day-to-day choices that, in the bigger scheme of things, don’t have much significance. For example, choosing red balloons (instead of some other colour) for an in-store promotion is an operational decision.
Occasionally, entrepreneurs turn their attention to tactical decisions. These revolve around how to achieve short-term objectives. For example, using an in-store promotion (instead of, say, print advertising) to attract more customers is a tactical decision.
Rarer still are strategic decisions. These involve long-term priorities and overarching plans for achieving them. For example, choosing to expand and attract more customers (instead of, say, consolidating or diversifying) is a strategic decision.
Finally, there are ownership decisions. These address fundamental issues, like the type of business you’re trying to build and what you’re ultimately trying to achieve. For example, deciding whether to build a profitable lifestyle business or scale beyond your personal capacity is an ownership decision.
There are two important takeaways here:
First, most entrepreneurs stick to operational and tactical decisions because they lack the ambition and courage to make strategic or ownership changes.
Second, the best that you can achieve with any decision will be constrained by your decisions at a superseding level. For example, regardless of how flawless your tactical decisions may be, their impact will always be limited to the strategic decisions that govern them.
Every business owner should strive to spend more time on strategic and ownership decisions, because those are the ones that will ultimately shape your future. Transitioning out of operational and tactical decisions isn’t an overnight process, but it also won’t happen by itself.
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