Emotion vs Logic: Empowering Momentum-Building Decisions

Every day decisions must be made in business. What sets growth companies apart from the rest of the pack is grounded in leaders having the ability to make momentum-building decisions, using both emotion and logic appropriately. How momentum building are your decisions in growing your company? What we have found is there is clear delineation for when logic is key, emotions are key and when both must be balanced in the decision-making.

1. Hiring & Firing: While making the cost investment in hiring can be a purely logical determination, when it comes to hiring or releasing a team member, both logic and emotion should be intertwined in the decision-making process. 

One of the biggest deterrents to growth for many business owners is a reluctance to hire their first key people, which is driven more by fear, while being justified with logic. Once this mental barrier is overcome, then logic plays a role in defining skills and qualifications desired, performance measures and role fit, while emotions consider culture fit, potential and relational team dynamics. Does the prospective hire bring a can-do attitude and enthusiasm to their role? Will they strengthen the team or disrupt morale? Does the top candidate in skills also demonstrate alignment with core values, culture and embrace the company mission?  

Terminations, when necessary, are best handled when both emotion and logic are balanced in the decision and the handling. The emotions side of this is in handling news to the team member being released with dignity, respect and empathy while balancing it with clearly documented reasons that also take into consideration the entire team. For instance, making the tough decision to let go of a top performer who is toxic to the team is where preserving the culture and overall team dynamics wins. In every case where I have seen this occur in a business, the team rallied in ways the business owner could have scarcely imagined exceeding expectations after the toxic employee was released. 

2. Customer Strategy:  Data analytics and return on investment analysis play a role from a logical perspective in developing momentum building customer engagement strategies. From tracking purchase history, a customer’s lifetime value (CVU), conversion, and churn rate, to measuring campaign effectiveness and profitability, these are all supported by data that should be accessible and trackable.  

Mentioned earlier, the emotion or psychographics, play a key role in understanding the emotional triggers in pain points, core values alignment, and branding that tells a story that emotionally resonates with customers. A loyalty program is most effective when emotional value is incorporated into the dollars and sense value of being loyal. Small heartfelt gestures can also go a long way to creating lifelong customers, as well as how you demonstrate the importance of relationships by how you correct a problem a customer experiences with your company. Making things right is an emotional value-add.

3. Growth Decisions: Making growth decisions needs data and logic to confirm everything from market demand and competitive advantage to improving profit margins, cash flow, and returns on investment. Planning for capacity in resources, tools, and capital also needs logic to assess and consider the best options. 

Where emotion comes into the mix is in confirming growth strategies are in alignment with vision, mission, and dreams for the company. Feeling personally excited and the team feeling excited about the growth initiatives, and how growth will impact balancing work and life for everyone on the team is also an emotional weigh-in for today’s workforce. 

4. Outsource Partnerships: Strategic vendor or supplier partnerships for your business also need a mix of emotion and logic to confirm the best fits. Does the partner fill gaps or skills needed in your organization? Will the partner build capacity needed? What is the track record, history, and reputation of the prospective partner?  

On the emotions front, values being in alignment are of key importance for a sustainable partnership. A shared vision and mission are also key for the partnership to be a scalable relationship. Their people and the chemistry with your internal team is also important to weigh in. Never forget that people like to work with people who are likable, communicate effectively and seek to form genuine connections. 

5. Exit Strategy: Choosing to sell a business is already laden with emotion for many business owners due to it being their baby about to be sold to the highest bidder. But it doesn’t have to feel that way. Putting your emotional equity aside, which can be tainted by a need to hold on tight and control, emotion does play a role in making momentum building decisions that will feel right while logic ensures the sale is done right.  

Ensuring the company is strategically sound, financially stable, and poised for growth all requires logical analysis and assessments. Valuation is based on financial metrics and a third-party objective appraisal. Logic also plays a role in determining timing of your exit. Is the market right for a buyer? Your deal structure is also based on logic. Will it be an outright sale, a gradual buyout, merger, or liquidation?

Letting go at the right time has an emotional role through respecting personal wellbeing and avoiding burnout. Planning for succession also has an emotional role in mentoring your future leaders while also building your personal legacy. Being considerate of the transition in honoring relationships and creating closure with valued team members that will be staying on after you leave is also an emotional factor that when handled adeptly gets them excited to see where the new owner will take the company.