The Art of Decision Making

“Human deci­sion-mak­ing is com­plex. On our own, our ten­den­cy to yield to short-term temp­ta­tions, and even to addic­tions, may be too strong for our ratio­nal, long-term plan­ning.” - Peter Singer, Amer­i­can philosopher

Every day we wake up, we’re con­front­ed with deci­sions that need to be made, rang­ing from the mun­dane (what shirt or dress to wear?) to the com­plex (should I hire the new mar­ket­ing man­ag­er or not?). And whether we real­ize it or not, we use the same deci­sion mak­ing process for both sce­nar­ios, just at dif­fer­ent speeds.

We get into trou­ble when we start tak­ing men­tal short­cuts – when we tell our­selves we have been in this sit­u­a­tion before so ​“I know the answer”. Unfor­tu­nate­ly, the known answer incor­po­rates your per­son­al bias with­out tru­ly defin­ing the prob­lem or deci­sion criteria.

Here’s a tried and true deci­sion mak­ing process we ask clients to undertake:

1. Define the problem

A clear­ly defined prob­lem allows us to effec­tive­ly search our alternatives.

I see orga­ni­za­tions chase the wrong prob­lem on a reg­u­lar basis, lead­ing to solu­tions that only address symp­toms, not root causes.

Exam­ple prob­lem: ​“We need to expand and require anoth­er retail location.”

2. Deter­mine the deci­sion criteria

What are the most impor­tant cri­te­ria that should be con­sid­ered in select­ing our alternatives?

• Pop­u­la­tion den­si­ty in excess of 50K with­in two km of the location
• Price per square foot < $30
• On a major street
• Has great sign visibility
• Sup­ports an open con­cept feel
• Is in a trendy part of the city.

3. Weight the deci­sion criteria

Use a scale where 10 is vital to the deci­sion and 1 is a nice to have. For our exam­ple problem:

• Pop­u­la­tion den­si­ty in excess of 50K with­in 2 km of the loca­tion (10)
• Price per square foot < $30 (10)
• On a major street (7)
• Has great sign vis­i­bil­i­ty (9)
• Sup­ports an open con­cept feel (3)
• Is in a trendy part of the city (8).

4. Devel­op Alternatives

Devel­op a list of alter­na­tives that meet the deci­sion cri​te​ria​.In our exam­ple prob­lem there are four retail loca­tion alternatives:

• Lons­dale
• Main Cor­ri­dor
• Cam­bie Corridor
• Com­mer­cial Corridor.

5. Select the best alternative

Select the alter­na­tive that best meets the most impor­tant deci­sion cri­te­ria. For our retail store exam­ple, we would inspect each loca­tion and choose.

Effec­tive­ly decid­ing on the deci­sion cri­te­ria and being hon­est about the impor­tance of the cri­te­ria tru­ly helps you select the right alter­na­tive. And, to fil­ter your inter­nal bias, lever­age your net­work to pro­vide per­spec­tive. The more you prac­tice this, the more effec­tive your team’s deci­sion mak­ing becomes.

The Chal­lenge

• Clear­ly list and pri­or­i­tize the deci­sion cri­te­ria for one key deci­sion cur­rent­ly in front of the team
• Vet the cri­te­ria based on the most impor­tant viable pri­or­i­ties and gen­er­ate your new list of alternatives.

Dean Ritchey is a Coach and Strate­gic Plan­ning Advi­sor at Lawrence & Co. Growth Advisors.