Decisions lie at the heart of our lives. They define, shape, and carry us towards our future. Everyone wants to make the best decision. But the paradox of decision-making isn’t in the selection between two paths. It lies in ensuring that the right paths are presented to us in the first place.
We often find ourselves caught in the illusion of choice. We believe that choosing between the options presented to us is where our power lies. But that’s not entirely true. True decision-making lies in the creation of options, not merely selecting from them. It’s the art of generating the right choices to pick from.
Yet this crucial step is often delegated, both in business and life. Part of generating the best options is to owning the process.
Establishing criteria helps safeguard you from settling. It also guides you towards superior options. Like outlining an ideal investment profile before investing. Or, crafting a dream job before a job hunt.
One common pitfall is to mistake momentum for progress – making rash decisions.
But remember, choosing not to decide is also a decision. If all you have are bad options, don’t hesitate to restart the process. You’re not obligated to stick to your initial options just because you’ve spent time and effort on them. This is known as the sunk-cost fallacy.
Creating a pool of excellent choices takes intention. Once you have them, even a less than perfect decision still leads to a favorable outcome.
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I’ve found that frameworks have been useful in assisting me with decision-making. Here are some of my favourites.
Easy choices, hard life, hard choices, easy life. Whether in personal matters or business, this rule of thumb holds true.
For example, to have those difficult conversations, taking actions that secures our future, investing in our intellectual growth and health. Small steps in these areas can compound over time. However, taking action is the only way the compounding effect works.
In the business realm, Paul Graham summed it up nicely. He said, “Suppose you are a little, nimble guy being chased by a big, fat, bully.” You open a door and find yourself in a staircase. Do you go up or down? I say up. The bully can probably run downstairs as fast as you can. Going upstairs his bulk will be more of a disadvantage. Running upstairs is hard for you but even harder for him.”
Often this can be achieved by separating decision making from implementation as we naturally lean towards what’s easier to execute.
Another way to make good decisions is to maximize impact and minimize regret. Ask any elderly about their regrets, and you’ll likely hear about the things they didn’t do. When we make decisions, we’re choosing our future regrets. This is due to opportunity costs.
Time, though a social construct, is a limited resource that will eventually run out. Choose your regrets wisely.
“What is the worst that could happen?”. Often, decision fatigue makes it difficult to choose. In such cases, treat life as an experiment. Ensure that your decisions are reversible. Jeff Bezos would call them “type 2 decisions.” This approach also requires minimizing the risks of ruin, as coined by Nassim Taleb. Embrace the idea of reversible decisions and keep the potential for disaster at bay.
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Good decision-making is less about the decision itself. It’s more about setting up for a rich pool of options.
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Use frameworks to guide decision-making.