​One of the most important skills you need to have as a manager is that of decision making. But here's the problem: indecisiveness can impede the efforts of even the most adept decision makers. Fortunately (insert sarcasm!), there are hundreds of ways to approach decision making and even more books and opinions on the matter.  In this post, I want to share the three inclinations to indecisiveness I discovered during my development as a manager, and three methods to overcome them.
 
Decision making overload
 
When I first became a manager, I was given some sage advice by one of the engineering greybeards: the ability to make results-oriented decisions could make or break a career. 
 
I realized that I had a lot to learn. 
 
So I read whatever I could about decision making theory and practice. A lot. I sought out opinions about decision making from anyone who would offer them. Who knew that flipping a coin would be a method alive and well in the business world?
 
I went to grad school to study systems engineering and analytical methods for holistic decision making. And of course, I made a lot of decisions – good and not so good – along the way and measured the results to determine the methods that worked and those that didn’t. 
 
What I discovered are the three things that contribute to indecisiveness, and three methods to power through them.  My approach here isn't to offer another opinion; rather, condense the methods I've used and watched other leaders successfully employ to make results-oriented decisions critical to their business.
 
The inclination to indecisiveness
 
Making decisions is hard and mentally taxing, and more often than not, we default (even for a short time) to a state of indecisiveness.  The inclination to indecisiveness can be summed up in the following three points:

• The paradox of avoidance – avoiding a decision rarely brings about a good outcome, even if you wish it so. This is the knot in your gut when you know a decision needs to be made, but it’s easier just to ignore it.   
• Analysis paralysis – too much data, information, and analysis can be a bad thing.  All too often, the amount of information required to make a decision isn’t well defined before a decision is considered.
• Fear of failure – the fear of picking the wrong option.  Just decide (even if it means you choose the do nothing option).  A wrong decision can always be corrected, but a decision unmade means too much time on the pot.

 
To power through the impenetrable wall of indecisiveness, here are three methods to help you make better decisions, faster.
 
3 proven methods to cover 99% of your decision making
 
In my last blog post, I identified the 3 main types of decisions (low risk, medium risk, high risk) and the three factors to consider for each (people, impact, complexity).  Here are the three proven methods to use when making either type of decision.

   1. Use your intuition

• Great for low risk decisions. 
• While it's true that we live in a world where there is an infinite supply of quantitative data to help us substantiate any decision, this can be debilitating.  In many cases, what's needed isn't more information.  What's needed is a decision, and that's where it's OK to use your gut when the risks are low (few implications if you're wrong) and you have experience with the topic at hand.
• Where things go off the rails is when instinct is used for high risk, uninformed decisions where there's no looking back once the decision is made.

   2. Use a pro/con list (T-chart)

• Great for medium risk decisions where there few alternatives.
• Many decisions we encounter are of the either/or type, such as deciding between two candidates (hiring, or even voting), for which the pro/con list method is ideally suited.
• Keep your decision making values front and center with a pro/con list method as you'll need to assess how the pro's and con's line up with the values you’ve defined for your business.

 
   3. Use a decision matrix

• Great for high risk decisions where there are a lot of people involved, there's the potential for a high impact to your business, or the complexity of the decision is high.
• This is a more labor intensive process as you’ll need to include weighted values for your deciding criteria, in addition to the options from which to choose.  Insight and opinion from others is recommended, as is a little more time to make the decision.

 
Stay off the pot
 
Spend your time and energy where it counts.  Use your intuition for lower risk, more routine decisions and make them quickly.
 
Invest your time in high risk decisions and use an appropriate method like a decision matrix to guide you. With this method, you’ll make more high-quality decisions, faster, and with a better outcome.
 
Send me an email or comment below if you’d like access to simple templates for the pro/con list and decision matrix tools, or if you’d like more information about any of the topics discussed in this post.
 

Elon Musk used this method of thinking to transform Tesla into a supply chain powerhouse and launch low-cost rockets into space. Reid Hoffman positioned Netflix to dominate the online streaming industry with nearly 200 million subscribers by leveraging this ancient thought process.

What is it? Reasoning from first principles, and when applied to decision making, can help to supercharge and simplify how you make decisions.

The case for something simpler
As a new manager, I struggled with how best to make decisions, quickly, consistently, and with the right impact.  When should I use intuition?  Data?  Analytical tools?  Consult others for the input? 

Looking back on the results of my decisions in my first few years as a manager, I knew that I could do better.  I wasn't getting the results I wanted and it was taking me too long to make decisions, even the simple ones.  I distinctly remember my frustration coming to a head on a bright and sunny Iowa summer evening about ten years ago when I blew threw a red light, so consumed was I thinking about the sheer number of decisions I had to make the following day. 

For me, this was a problem that needed solving and as an engineer, I felt well equipped to approach decision making as a problem for which first principles reasoning could be used to solve.

Aristotle's axiom
Musk and Hoffman both employed a first principles way of thinking, initially conceived by Aristotle more than two thousand years ago.

For me to re-engineer how I made decisions, this meant taking a step back and pressing pause on my knowledge, analogies, biases, and other factors which influenced my decision making to consider the most basic building blocks of any decision.

Decision building blocks: tear it down and build it up
Let's start with a definition.  A decision is simply something you choose. 

Most decisions we make are done so automatically and we prefer it that way.  Decision will power is finite and every time we have to engage the logical and thinking parts of our brain to consciously make a decision, we chip away our ability to make a good decision next time.  Daniel Kahneman does a magnificent job detailing the two models of thought (System 1 - fast, automatic, and System 2 - slow, logical) in his book Thinking, Fast and Slow.

I knew that I needed to keep as many decisions as possible in the automatic realm of System 1 and only engage System 2 when it really counts.  This could be done by identifying the type of decision, but first I needed to consider the most basic elements of a decisions.

After more research than I care to recount, I came to the conclusion that all decisions have three common core elements: people, impact, and complexity.

• People - this may be just you, your team, your customers, or your entire organization.  For every decision you make, people are involved.
• Impact - this is the degree to which your business is impacted by your decision, usually measured in financial terms.
• Complexity - does your decision involve a lot of a analysis or research or is it relatively straight forward?

It all comes down to risk
As started to rethink how I made decisions, I needed to consider how these three elements fit together in the context of risk to decide how I wanted to engage with each decision I encountered.

Just a few people, low impact to my business, and a very simple A or B choice?  That's a low risk decision.   I needed to make a decision and move on.  These are the majority of decisions I encountered and unfortunately, consumed most of my time. 

Policy or strategic decisions tended to involve more people, have a greater impact, and were more complex.  These were medium risk decision.  

High risk decisions were the ones where I knew the stakes were high.  Often involving  a lot of people, with a big impact, and more complex (including plenty of analytics), these were the decisions I knew required more of my energy and focus to do well.
​
Decisions reconstructed: how it all fits together

​As shown in the triangle, here's how the first principles model for decision making fits together.
​
The base consists of the number of people involved in the decision, the impact the decision will have on the business, and the complexity of the decision. Once I got a feel for the magnitude of these elements, I could then determine if the decision was low risk, medium risk, or high risk. 


If you're like me and the majority of managers or business leaders, you spend far too much time on low risk decisions as these are the most common. To make more, better, and faster decisions, you need to flip your thinking. Keep the low risk decisions on autopilot and make them fast. Place the effort where it counts, and spend more of your time on medium and high risk decisions.


 3 key takeaways
 1. First principles can be used to break down a problem into its most basic elements. When applied to decision making, it can help you make more, faster, and better decisions.

2. Decisions are built on a foundation of three common elements: people, impact, and complexity.

3. The magnitude of these elements dictate whether a decision is low risk (autopilot), medium risk (think about it), or high risk (detailed analysis).  Identify the type of decision before investing time to solve it.

Here's to more, faster, and better decisions and driving great results!

-luke

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