4 Steps to Good Decision Making
I would like to address decision-making in my book, as that is a key part of getting things done, but there isn’t space.
So, I’m posting here the four steps to making effective decisions that I would have developed a bit in the book. They are:
- Understand the objectives
- Consider the alternatives
- Consider risk
- Decide
Very basic, to be sure. But it is surprising how often we go into important decisions haphazardly, without taking an intentional (albeit simple) approach.
How Information Overload Affects Decision Making
A recent article from Newsweek. Here’s the summary:
The Twitterization of our culture has revolutionized our lives, but with an unintended consequence—our overloaded brains freeze when we have to make decisions.
And this is very interesting:
The booming science of decision making has shown that more information can lead to objectively poorer choices, and to choices that people come to regret. It has shown that an unconscious system guides many of our decisions, and that it can be sidelined by too much information. And it has shown that decisions requiring creativity benefit from letting the problem incubate below the level of awareness—something that becomes ever-more difficult when information never stops arriving.
The Longevity of the Temporary
Here’s an important point for decision-making from Drucker’s The Effective Executive (129):
One of the most obvious facts of social and political life is the longevity of the temporary. British licensing hours for taverns, for instance, French rent controls, or Washington “temporary” government buildings, all three hastily developed in World War I to last “a few months of temporary emergency” are still with us fifty years later.
The effective decision-maker knows this. He too improvises, of course. But he asks himself every time, “If I had to live with this for a long time, would I be willing to?” And if the answer is “no,” he keeps on working to find a more general, a more conceptual, a more comprehensive solution–one which establishes the right principle.
The Paradox of Choice and the Meaning of Freedom
My wife has been enjoying the book The Paradox of Choice and I’m looking forward to reading it as well. The concept is simple: having more choices doesn’t always lead to more happiness. Often, it leads to paralyzed decision-making and discontent.
Here is the author’s presentation recently at TED, which gives a great summary of his key concepts:
I have one disagreement with Barry Schwartz in the video. He states at the beginning that maximizing individual freedom is a central tenet of western civilization, and that “the way to maximize freedom is to maximize choice. The more choice that they have, the more freedom they have, and the more freedom they have, the more welfare they have.”
I agree that maximizing individual freedom is a central tenet of Western civilization, but I think he has slightly misstated things thing when he says that this entails the idea that “the way to maximize freedom is to maximize choice.”
Many people believe that, probably. But that kind of freedom is not at the heart of Western civilization.
For example, the founders of this nation serve as a good representation, I would contend, of what the tenet of freedom means when it comes to the guiding principles of Western thought. And I don’t think that they saw the essence of freedom as maximizing choice.
The essence of freedom that was captured in the American Revolution and which, I would argue, is at the heart of Western society is rather the right to make your own decisions. The number of choices that you have is not ultimately relevant here. The main idea is that you get to choose, not the government or someone else.
You don’t need someone to provide you with a lot of options in order to be “free” in this sense. It’s about choosing your own path and making your own decision — and, if you think you don’t have enough options, finding a way and possibly creating more options yourself.
That’s the view of freedom that is at the heart of Western society. Schwartz is taking aim at another view of freedom — a very common one, and perhaps one that is pervasive and dominant at this current juncture in history and going back a generation or two, but not one that should be characterized as central to Western civilization per se.
The view of freedom that Schwartz is taking aim at here, which so values maximizing options, is in part behind a recent mutation of the original Western view of freedom. This mutation holds that if you don’t have health care, you aren’t free, or that if you don’t earn a “living wage,” you aren’t free, because both things limit your options. It is then implied that the government ought to provide these things for people, “in the name of freedom.”
Schwartz of course isn’t discussing that mutation on the concept of freedom. But I think it goes to show the importance of getting this term correct.
To conclude: I’m not against having lots of options; I just want to point out that the value of maximizing individual freedom does not depend upon the number of options you have. And it certain does not entail that we have a duty to maximize people’s options. Rather, it simply entails that we let people make their own decisions. This includes, of course, the decision to generate more options — as well as the decision, which Schwartz does a good job contending for, not to always seek out a wide range of options.
Decision Making vs. Time Management
Suzy Welch was recently interviewed on her “10-10-10″ decision making strategy. Here are two questions from the interview that get at the heart of things:
What exactly is 10-10-10?
It’s a way of looking at dilemmas that have no easy answer and assessing the consequences of your options in 10 minutes, 10 months, and 10 years and bringing to bear on them your authentic values — how you want to live, who you want to be, and who you want to spend time with. When you put your options and your values together like this, you can make decisions in a way that allows you to create a life of your own making instead of your life living you.
How is 10-10-10 any different from any other time management/resource allocation strategy, like, say, Timothy Ferriss’s The 4-Hour Workweek?
The difference is that 10-10-10 is a decision-making process. The 4-Hour Work Week is just about time management.
Six Thinking Hats
Mindtools has a good overview of a decision-making tool called the Six Thinking Hats. This tool helps improve your decision making by enabling you to look at a decision from all angles.
“Six Thinking Hats” is a powerful technique that helps you look at important decisions from a number of different perspectives. It helps you make better decisions by pushing you to move outside your habitual ways of thinking. As such, it helps you understand the full complexity of a decision, and spot issues and opportunities which you might otherwise not notice.
The hats are:
- White hat: focus on the data available.
- Red hat: look at the decision using intuition and emotion.
- Black hat: look at things pessimistically [my least favorite! -- but it will help make your plans tougher].
- Yellow hat: look at things optimistically.
- Green hat: look at things creatively.
- Blue hat: this stands for control, which means directing attention to the most needed hat when circumstances require. For example, if ideas run dry, directing focus to the green hat, or directing focus to the black hat when it’s time to create contingency plans.
For more details and examples, read the whole thing.
The Root of Making Good Decisions
There are lots of different formal and informal approaches to making decisions. But at the end of the day making a good decision comes down to one thing: Knowing the fundamental governing principles of the area. Usually there is just one.
For example, as I posted earlier today, with the economic policy of a nation, the governing principle is to maximize people’s freedom to the greatest extent while preserving the rule of law. In deciding where to work, the guiding principle is: where can I have the greatest impact with the gifts I’ve been given? In managing an organization, the guiding principle is to make employees’ strengths productive for the performance of the organization while minimizing weaknesses.
Once you understand the governing principles of an area, most decisions fall into line. More on this in the days and months to come.
Good Resources on Decision-Making
The Mind Tools website is filled with great resources for excelling in your career. Their section on decision-making summarizes lots of helpful tools for making decisions, such as grid analysis for selecting between good options and PMI (pluses, minuses, implications) for weighing the pros and cons of a decision.
About Matt Perman
Follower of Christ. Husband of one, father of three. Former director of strategy at Desiring God. This blog exists to help equip Christians in good works, because that's what productivity is really about.
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