Here comes the judgment!

A young banker asked a retiring banker what the secret of success was in banking, to which the older banker responded, "Good judgment."

The rookie then said, "How do you get good judgment?"

The older banker said, "Experience."

To which the youngster asked, "How do you get experience?"

And the retiring banker said, "Bad judgment."

Anyone who has ever been in business can identify with that story.

As a business leader and parent, the one attribute I value most is a person's good judgment. Judgment is the result of a person's decision-making. When your values are clear, making decisions becomes much easier.

Nothing replaces good judgment. International Judgment Day is Jan. 17 every year.

Good judgment involves evaluating circumstances, weighing the positives and negatives and considering alternatives.

"In the face of ambiguity, uncertainty and conflicting demands, often under great time pressure, leaders must make decisions and take effective actions to assure the survival and success of their organizations," said leadership expert Warren Bennis. "This is how leaders add value to their organizations. They lead them to success by exercising good judgment, by making smart calls when especially difficult and complicated decisions simply must be made, and then ensuring that they are well-executed."

A variety of challenges confront leaders and team members every day: budgets, mistakes, delays, staffing, conflicts, safety, profits — all call for making decisions that can affect an organization's future. When decisions must be made quickly with limited information, being able to trust your good judgment is central to making the right call.

What are the skills you need to improve your judgment?

• Ethics is all about knowing what is right and wrong. Is it fair and legal? When I talk about ethics in my speeches, I introduce the subject by saying, "Act like your mother is watching."

• Consistency is expected. You can't let emotions or intense situations affect your judgment. Even the best business plans will fail without a dedication to consistency.

• Listen to learn. Listening to others allows you to collect and assess important information rather than relying on your opinion or personal bias. Good judgment is about making the best decisions rather than relying on your opinion.

• Accept your mistakes. Everyone makes mistakes. Accept responsibility and move forward. The important thing is to learn from your mistakes, figure out what went wrong and don't repeat them.

• Learn from experience. As the opening story says, nothing beats experience in improving your judgment. If something went wrong, do things differently the next time, and if things went right, learn from your decisions.

In addition to those skills, John Spacey, writing on Simplicable.com, emphasizes the need for pragmatism and situational awareness. Accepting "difficult real-world conditions such as uncertainty, gray areas and imperfections" is a must for making sensible and sound decisions. Equally important is the "ability to be highly observant and diligent to respond to fast-moving situations," he writes.

Here's another story to illustrate my point. A business owner who was nearing retirement invested her life savings in a business enterprise which had been elaborately explained to her by a swindler.

When her investment disappeared and the wonderful dream was shattered, she went to the office of the Better Business Bureau. They asked, "Why on earth didn't you come to us first? Didn't you know about the Better Business Bureau?"

"Oh, yes," said the businesswoman, sadly. "I've always known about you. But I didn't come, because I was afraid you'd tell me not to do it."

It's a sad story we've heard over and over again. Too bad her judgment didn't lead her to ask questions that she might have asked about the proposed investment: Is this a risk I can afford to take? Is this person honest and trustworthy? Is this the right time to take such a gamble? What if it doesn't work out as planned?

Simple but necessary questions could have saved her a life of regret.

Mackay's Moral: Judgment is knowing which door to open when opportunity knocks.

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Harvey Mackay is the author of the New York Times bestseller "Swim With the Sharks Without Being Eaten Alive." He can be reached through his website, www.harveymackay.com, by emailing harvey@mackay.com or by writing him at MackayMitchell Envelope Co., 2100 Elm St. SE, Minneapolis, MN 55414.