You Can't Be a Wimp--Make the Tough Calls

As one of the world's preeminent advisers to CEOs, Ram Charan has spent the past 35 years on the road, helping hundreds of executives deal with their toughest challenges. In this edited interview, he shares what he's learned about decision making over the decades. Getting to the right answer is a lot harder today than it was 10 years ago, Charan points out. Leaders have to contend with more variables and constituencies than ever before. They must be able to cut through all that complexity and to make subjective judgments about highly ambiguous, and constantly changing, factors. The best executives know which decisions to focus on (and which to delegate), when to make a decision, and what the risk of not making a decision is. When opportunities arise and vanish quickly, timing is critical. In this environment, good decisions involve a lot more than analytics. They demand perceptual acuity, or the ability to see change coming; qualitative judgment, which allows leaders to formulate and select the right options; and credibility, which helps them gain acceptance for decisions. All three traits can be developed over time by practicing the right habits, such as listening to diverse and contradictory views, thinking through second- and third-order consequences, and socializing decisions by demonstrating transparency and explaining their performance payoff.

• Leadership qualities
• Executives
• Managing uncertainty
• Decision making