HOW TO MAKE A GREAT (BIG) DECISION
DO THIS AND NEVER BE WRONG AGAIN
What do you do when you have an important decision to make?
a) Stress out
b) Procrastinate/Divert your attention to other activities
c) Think it over…and over… and over… and over
d) Master it, make the decision, and move on!
Big decisions come with big consequences. It’s common to put off making tough choices because you don’t want to be wrong or cause yourself or others unnecessary pain and expense–financial, emotional, or any other kind of toll.
The good news:
There is a secret to mastering big decisions and making the right choice...
Every.
Single.
Time.
The bonus:
When you do this, you will dramatically lower or even eliminate the stress you normally feel when you face a big decision without a plan.
In our last blog of the Decision Mastery Series, we identified how important a plan or method is when making important decisions. In this series, we will go through the process step-by-step...but first, a brief overview:
*NOTE: The following information is sourced from the decision-making process detailed in my bestselling book, Never Be Wrong Again: Four Steps to Making Better Decisions in Work and Life (Thoreau Press, 2015.)
The four key factors to consider before making any important decision are:
Timing
Probabilities
Balance
Pattern Recognition
Timing
“You may delay, but time will not.” Benjamin Franklin
The first question to ask yourself when you face a big choice is:
When do I need to make this decision?
Most important decisions are not driven by the calendar, including the decision to get married, get healthy, or re-examine your career.
Set a deadline and give yourself cushion time to reflect on your tentative “final” decision. If your deadline is a month from now, make this “final” choice with some buffer time (a week, for example) before the deadline. Set calendar alerts for the deadline and reminders leading up to it. Treat the self-imposed deadline as if it were mandatory.
Probabilities
“If you don’t know where you are going, any road will get you there.” Lewis Carroll
The right choice is the one with the best chance of getting you to your goal.
1. Know exactly what you want.
2. Be very specific.
For example, “leading a healthier lifestyle” may be a desire, but it is not a measurable goal. Losing 10 pounds and lowering your blood pressure 15 points are well-defined goals that will make progress trackable.
Identifying your desired outcome as precisely as possible will pave the path in front of you by making the decisions that will lead you there more clear.
Balance
“He who wishes to fight must first count the cost.” Sun Tzu
What are you willing to give up to get what you want? It’s been proven that people focus more on rewards and underestimate cost and risks. This is especially true among investors. First, lose the rose-colored glasses and get real about the potential rewards.
Second, make sure you have taken all risk and costs into consideration. People make the mistake of looking only at monetary costs, but the highest cost is often your time. Depending on the decision you face, intangibles, like relationships or quality of life/work-life balance may also be factors to consider.
Balance asks: Are you willing to actually put in the effort, risk the expense, and spend the time required to achieve your goal? Quantify these costs mercilessly. Then decide if the risk is worth the reward.
*In the book, we also cover the balance of Gut instinct vs. Data.
Pattern Recognition
“I know of no way of judging the future but by the past.” Patrick Henry
Pattern recognition can sometimes be complex to analyze, but the concept is simple: Past events can help predict future outcomes.
There is overwhelming evidence that smoking cigarettes is harmful to your health. Does this ensure that if you don’t smoke you won’t get cancer? No. It also doesn’t guarantee that if you do smoke, you will get cancer. But massive data indicates that your chances of getting cancer are increased by smoking and reduced by not smoking.
Pattern Recognition starts with correlation, but seeks a clear distinction between relevance and causation.
By sorting data into manageable silos, trends can be identified. Then we look closer at the relevance of similar outcomes to find the causes. This is where the gold is! Finding causation is almost like having a crystal ball. The more closely you can predict your outcome, the better you can control your future through making the right decision.
Next time you have to make an important decision, consider these four factors and notice how much less stress you feel as a result. The more you practice, the more confident you will feel tackling big choices, and soon you may start thinking of yourself as a decision-making expert!
In the coming blogs, I will dig deeper into each of these four factors to making great decisions and walk through some helpful real-life examples. It is my hope that through my four-point formula for decision making, you will not only feel empowered to tackle any choice that you are faced with, but also stop procrastinating and feeling stressed about it. If you missed the first part of this article, you can find it here.
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