Judgment: How Leaders put the Energy into Vision and Strategy April 14, 2011 RICCentre By Steve Sheils I read a quote the other day that caught my eye. It embodied the essence of my consulting practice. “Making Judgment Calls Is The Essential Job of a Leader” * With good judgment, little else matters * Without good judgment, nothing else matters It’s expected that effective leaders know how to sort the important from the trivial. That they can routinely manage relationships with key constituencies and align team members for support. But how and from where do the business leaders acquire the skills associated with this decision-making process? Three domains of decision making involves; the people we work with; the strategies that underpin our business plans and the numerous and varied crises that our businesses strive to overcome. It’s a thing of beauty to observe the charismatic leader who shoots from the hip with style and grace and watch his staff lean closer with commitment and support. Equally intriguing to watch is the CEO who is over his head, as he / she bellows veiled threats “we’ll be in serious trouble if we can’t get this project done on time and to budget”. Whether you are running a small department or a global operation, relying on an effective judgment process will give you a framework for evaluating any situation, making the call and making corrections if necessary. I teach business owners that leadership and judgment are intimately connected. That each and every facet of their business requires making judgment calls. Many think that senior CEOs such as Roberto Goizueta, who ran Coca Cola, are smarter than the rest of us. But if you Google Roberto you will learn he was demonized for launching “New Coke”; the product so many of us disliked. Few remember that he redeemed himself for launching the incredibly successful “Coke Classic.” How many of us remember Carly Fiorina? I met her a few times and thought that she was a pioneer in the ranks of female executives. But she is remembered for “destroying HP’s culture” – a comment made by others and not me. And everyone seems to love Jack Welch. Few recall that he left GE after failing to complete the $47 billion acquisition of Honeywell. Did these people succeed or fail? It’s a matter of judgment. Throughout our lives each of us makes thousands of judgment calls; from the cereal we eat to the person we marry and the places we work. In business, the cumulative effect of our judgment calls determines the success or failure of our businesses and ourselves. I teach that good judgment is based on a three phase process; the preparation, the call and the execution. That good leadership judgment is supported by the contextual knowledge of one’s self, our social network, the organization in which we work and the stakeholders who look to us for achieving specific business goals. A “leadership judgment framework” should be a tool that leaders use to develop the ability in their Executive Teams. Even though judgment seems to be a singular achievement when a given issue is examined, it’s actually is a blend of management wisdom and leadership action. For me however, judgment will always be about how leaders put their energy into Vision and Strategy. Comments? I’d like to hear about an example of when you lived through the result of an extremely positive or negative judgment call. Steve Sheils is the CEO of Authentic Vision for Change. Steve’s passion is helping companies make the difficult decisions required to achieve profitable growth in this tough economy. He can be reached at 416-819-2004 or by email email@example.com. Visit www.authentic-vision.com. The RIC blog is designed as a showcase for entrepreneurs and innovation. Our guest bloggers provide a wealth of information based on their personal experiences. Visit RIC Centre for more information on how RIC can accelerate your ideas to market.