How leaders at fast-growing companies make decisions

This article is a part of our Risk + Reward series. Capital One Business and Inc. partnered to survey 314 business leaders in November of 2024 to explore the factors that affect how they weigh business risks and rewards in navigating modern business landscapes. View our key findings and other articles in this series.

When seasoned entrepreneur Ron Jumper, owner of Bath Makeover of Arkansas and CEO of Ron Sherman Advertising, is making a decision in his business, he looks at every business metric possible. Sometimes, though, data doesn’t tell the whole story, and he needs to use intuition and experience to fill in the blanks. For example, when his ad agency was unsure of how much of a client’s web traffic came from a television ad versus a radio spot, Jumper parsed out the truth based on past campaigns. “Your gut instinct needs to be based off [of] accurate data,” he explains.

One of the key challenges business leaders face is finding the right combination of data and intuition to make decisions for their business. A recent survey by Inc. and Capital One Business found some differences in how entrepreneurs and business executives approach this balance. Sixty-eight percent of high-growth business leaders rely on intuition when making decisions, compared to 48% of slower-growth organizations (those growing less than 10% annually). Entrepreneurs are especially reliant on gut instinct, with 72% saying they are guided by intuition when making decisions related to business growth, compared to 49% of corporate executives.

At first glance, this may seem like entrepreneurs are less data-driven than their peers in the corporate world. However, there may be other factors at play.

Companies are increasingly relying on technology, including artificial intelligence (AI), to analyze and act upon data. Research repeatedly shows that data-driven organizations outperform their peers. Ultimately, though, humans make business decisions, and data won’t always have all the answers. Sometimes, business leaders will draw on both gut instinct and experience. After all, the more experience you have, the more likely you are to be able to anticipate possible scenarios and plan for them. However, when it’s available, good data and input from others can help you test your thinking and avoid bias.

Jumper says that his appetite for risk has evolved over time. Now that his companies are well-established, he is less likely to make risky moves. “I definitely took a lot of risks earlier in my career,” he says. “[As you grow] it becomes more about figuring out how to put better systems and processes in place,” he adds.

Having more to lose can make decision makers more cautious. But you can’t let fear hold you back. Part of success, and resilience, is “being able to be okay at the end of the day if your gut was wrong,” explains Kyle Dennis, president of 5Boys Apparel, a family-owned and operated screen printing and embroidery company. “A lot of people, when it comes to financial risk and financial decisions, make decisions because they’re scared of how they will feel if they’re wrong,” he says. Recognizing all possible outcomes, and whether you could withstand the worst-case scenario, can help you assess risk and proceed boldly when appropriate. When in doubt, try taking smaller steps or making more limited decisions to mitigate risk. Other factors affect decision-making, too, such as the impact on people who will be affected by decisions, including customers, employees, stakeholders, and others.

According to Inc. and Capital One Business’s research, 57% of business leaders believe growth is more dependent on leaders’ decisions than external factors like the economy. They believe that they have the power to influence their company’s performance— and rightfully so.

By learning from experience, relying on data, seeking feedback, and, most importantly, trusting yourself, you can improve your decision making and the future of your business.