1. Make a “value-based” pros & cons list

Imagine that you’re considering a move. Will you relocate to another city? Pull out a piece of paper and write a classic pros and cons list for the move. Now, here’s where science has added a helpful twist. Assign every list entry a number from 0 to 1, based on your personal values. For example, if being closer to your family is a “pro” that’s extremely high on your list, you might score it at 0.9 or 0.95. If you listed “near the mountains” as another pro, but you’re more of a culture hound than an alpine hiker, then it might only rate 0.2 or 0.3. Do the same for the “con” side. Leaving a job you love could score 0.8, for example, if your career is an essential part of your life. Add up each side, multiply by 100, and see whether the pro or con side wins out. You can also make a separate pro and con list for staying where you are. Compare the final values and see how you feel about the outcome. Often, confronting a “logical” number (which was actually weighted with emotions) can illuminate subconscious feelings. If you see the numbers but still feel pulled in the opposite direction, it’s worth doing some deeper exploration. You can also use this technique for smaller, less personal decisions, like which project or feature to tackle next.

2. Explore future scenarios

Considering the best- and worst-case scenarios is a common way to make tough choices. What’s the very best future you can imagine? The worst? And how would you feel if that disastrous scenario became reality? To expand on this technique, psychologist Gary Klein has studied a twist he calls the “premortem.” In a Harvard Business Review story, Klein explains why a premortem is the hypothetical opposite of a postmortem.

       “A postmortem in a medical setting allows health professionals and the family to learn what caused a patient’s death. Everyone benefits except, of course, the patient. A premortem in a business setting comes at the beginning of a project rather than the end, so that the project can be improved rather than autopsied.”

       Imagine that your decision was terrible. The project you chose to tackle was a crash-and-burn disaster. Now, explore every possible reason for the failure. Once you address this worst-case scenario, you can take steps to prevent it — and make a better decision in the first place. In fact, research shows that premortems (which are also called prospective hindsight) can increase our ability to identify future outcome causes by 30%. On the flip side, try to visualize that epic, best-case future scenario and gauge how you feel. If you’re not happy or excited, it’s worth considering why. Amazon uses a variation of both these techniques. Company developers must draft a hypothetical press release and FAQ announcement before they even write any code. By working backwards, the team tackles the most difficult decisions upfront and clarifies the product’s value proposition.

3. Avoid binary choices

We often get stuck choosing between this or that. Should I go back to school or start a business? Should I move to Seattle or stay in Denver? It’s easy to see the world in black-and-white, but there’s typically a grey option in the middle — or several shades of grey. Maybe you could spend summers in Seattle and winters in Denver. Or, you could live in Denver for another couple years and move to Seattle later. Sometimes the right choice is not one of two opposites. It’s a more creative, nuanced, or flexible solution.

4. Consult with others

Sharing your dilemma with others can justify or reinforce a choice, but more importantly, it’s a valuable way to gather valuable information. If you can’t decide whether to move, for example, don’t just survey your friends and family (who will also have skin in your game); talk to someone who made the same move. Ask how they feel now about their decision. For professional or business decisions, try hiring a consultant. Find people who have deep, niche expertise and learn as much from them as you can. The extra information you gather will almost inevitably help you make better choices in the future.

5. Avoid hidden decisions

For nearly 6,000 years, North America’s First Nations hunted the plains buffalo by chasing them over cliffs and finishing the kill below. This method enabled tribes to gather and store large quantities of meat, hide and fat for the long winter ahead. I always wondered why so many bison would just run over the cliff. They were usually pursued by hunters on horseback, for one, but it’s also an example of herd behavior. All the animals are just following the group, letting the flow take them where it will. Buffalo jumps are a good metaphor for hidden decisions or non-decisions, which we’ve all experienced at times. When you procrastinate or delay an important choice, you’re still making a decision — and it’s rarely a good one. For example, maybe you need to part ways with an employee, but you put it off to avoid a potential confrontation. If the employee is negative, unpleasant, or ill-suited to their role, the choice to wait and delay can poison the whole team. Non-decision is a choice with real consequences.

Those 35,000 daily choices can be daunting, but quick action is the enemy of decision fatigue. Choose fast and whenever possible, tackle your choices head-on. Use as many methods as you need to pick the best solution. Just don’t follow the herd. Choose what’s best for you — and then stand firm in your decisions.

One final note: if you’ve started a business or launched a product and you’re feeling overwhelmed by all the decisions, please know that it does get easier. Additionally, Five23 can help you analyze your chooses. Our packages can help any stage startup reach its full potential and take the guesswork out of the process. Once your business is stable, many of the big, foundational choices are done and you will reach equilibrium. Then it’s time to focus on the constraints. Determine where you can make the most important, impactful decisions, and use them to grow or refine your business. Remember: decision-making gets easier with practice, and a new choice is always just seconds away.

The post 5 Techniques that Help Entrepreneurs Make Hard Decisions first appeared on Five23.

Get Disciplined with Invoicing

Slow invoicing is one of the biggest reasons why businesses fall short on cash; and why many business owners don’t treat invoicing as a priority compared to day-to-day activities of delivering their product or service. But, if you don’t invoice, you won’t get paid by your customers. For example, create discipline around your invoicing practices by setting aside 15–30 minutes on the same day and time each week to review and process your invoices and payments. Be sure to address invoices that need to be created and sent to customers; invoices that have been paid: invoices that are outstanding and when payments are expected, and also be sure to review customers who are past due on their invoices and need to be reminded to pay.

Review Your Expenses

Every business is different and has its own specific expenses at various stages of development. Take a look at all the expenses your business has on an ongoing basis. Evaluate which expenses are necessary for running your business right now, which expenses are related to investment in business development opportunities and which expenses are simply “nice to have.”. To improve cash flow in your business, you want to minimize the spending outside of the necessary expenses and make sure you are investing in business development activities that are yielding or expected to yield a reasonable return.

Pay Your Bills on Time

When cash flow seems thin, it’s common for business owners to start paying their bills late. But, by paying late, you’re just moving your cash problem to a future period. In addition, you may be hurting your business’ reputation with vendors. Just like your business, your vendors rely on timely payments from their customers to maintain healthy cash flow and do their work. As such, it’s important to pay your bills on time. But if it’s really not possible to pay your bill on time, communicate with your vendor about your cash flow situation, how you are working to improve cash flow, and when you expect to pay them. If you maintain good relationships with your vendors by paying on time, they are more likely to help you out when cash flow is light.

Have a Financing Option

Despite your best efforts to track and manage your cash flow, unexpected events will occur that can throw off your cash flow. These could be positive for your business, such as a customer asking you to fulfill a big order, or negative for your business, such as a commercial landlord raising your rent. When these events occur, you might need to rely on another source of cash for your business, such as personal savings, credit cards, friends and family, a business loan, or even venture capital. It’s typically more difficult to get financing when the event is occurring — many financial institutions hesitate to provide financing to business owners in time of distress and those that do often charge usurious rates and/or you may not be able to carve out the time to evaluate and enter into a reasonable financing arrangement. Having a backup financing option in place will provide a cushion for unexpected events.

Taking proactive steps in managing your business’ cash flow will help you improve operations, free up cash for investment in business development, and reduce your stress as a business owner.

The post Successfully Manage Your Startup’s Cashflow first appeared on Five23.

As an entrepreneurial person, you probably have no shortage of business ideas. It’s not difficult to come up with potentially great business opportunities. But starting a business is challenging and takes significant energy. If you try to develop multiple ideas at once, you might find yourself stretched thin and struggling to create a thriving business. Let’s sit down and look at what you should ask yourself when choosing an idea to focus on.

Does this idea align with what you value?

It’s helpful to visualize how your business ideas could impact your life. The best entrepreneurs identify the areas of their life that are most important to them, assess how they feel about the time and energy they are currently devoting to each area, and determine if anything needs to change for them to lead an integrated life. You can also use this tool to assess how your business idea might impact the areas of your life that are important to you and whether it could support the life you want to lead.

Is this something you are passionate about doing?

Ask yourself if you really are called to this idea. Is this an idea you can’t not explore? What makes you passionate about this idea? And if this idea is feasible, how do you feel about the prospect of committing a significant amount of your time over the first few years to create a business out of it? When you are truly passionate about an idea, you will be more enthusiastic about going through the processes of testing the idea, planning for growth, and operating your business.

Does this idea meet a real need?

Your perception of the need for this business idea is shaped by your own needs, the experiences you have, and the stories you’ve told yourself about them. As a result, you may bring in your own assumptions, biases, and blind spots about your customers; the needs they have and potential solutions to meet those needs. In order to make sure your idea meets a need, we recommend spending time researching your market by talking with potential customers and observing their behaviors.

Do you have the experience to implement this idea?

Starting a business is a significant challenge on its own. You don’t want to have learned an entirely new industry or gain a bunch of new skills while figuring out how to build a business. You have a greater chance of pulling off the business idea the more you can leverage your background, knowledge, talent, skills, experiences, and network.

The post Finding the Right Business Idea first appeared on Five23.