How to Measure a Business Decision

Most of the business decisions are based on the immediate outcome. The second and third order consequences are not taken into consideration

Let me explain with an example:

Let’s say you decide to reduce marketing expenses budget to meet the cost-cutting demands.
So what happens next, cost comes down and profitability goes up.

But what are other consequences of this decision

1. Number of leads reduces
2. The branding of the company is now restricted
3. Sales number suffer

Looking ahead into the future, it can impact also the value of the company as the growth rate might suffer which might impact shareholder’s value in long-term

So before taking any decision in business the benefits in near-term should be compared to the potential cost in long-term

But again all this is only possible, if you have the facts and numbers to take decisions proactively.

At Soatech, we define and prepare business reports and framework that helps companies to take decisions proactively
Remember: Choice of not making decision is also a decision