Making Decisions

The road of life is paved with flat squirrels who could not make a decision.

Many people have flattened financial plans for the same reason.  Implementation means picking a method that is different from what you are doing now.  Doing nothing now is a decision.

Why do some people have trouble making decisions?  There are many reasons I suppose, but most involve fear of error.  Maybe it will go wrong.  Maybe there is a better one that I don’t know about.  Once people recognize that doing nothing is as much a decision as doing something, things can proceed more productively.  Always compare the cost/benefit of doing something to the cost/benefit of doing nothing.

Some people avoid any decision.  I prefer to work with business owners and professionals because almost all of them can and do make decisions.  It is a practiced thing and they don’t even know it is a special skill.  A superpower even.  They have learned, because they could not avoid learning.  How many decisions does a doctor make in a day?  Probably as many as some people would make in six monthes.

Weak decision makers have an inherently wrong approach.  They think all decisions are binary.  Do this or do not looks risky. Experienced decision makers use candidate decisions to reach a better decision.  The doctor might order a specific test to confirm or deny their first impression.  A person might learn about their emotional content and a little about investing by opening an online trading account with a little money.  A tiny amount.  Losing $200 has the same emotional and educational lesson as losing $200,000.

Weak decision makers need to know too much before moving on or they act precipitously.   If you know less than 40% or so of what you need, you must seek more.  If you already know 70% you should make a candidate decision at least.

Strong decision makers know that reversible decisions are never risky if you can afford the price to reverse it.  Should the office have mugs or cups and saucers to serve coffee to guests?  How could the decision be wrong?  A decision  to sell the family farm is riskier because you could not get it back if you did not like the decision later.

Strong decision makers know that the initial binary choice is usually an illusion.  Governments often seem to make the mistake by saying, we must raise taxes or cut services.  That is for show.  There are many solutions that involve other approaches.  Sometimes a little of each.  Sometimes tidying up the overhead.  Sometimes dropping the obsolete things.  Sometimes waiting to implement some expensive projects.

You will find that decision making is a learned skill and practice will perfect it.  Despite the perfecting, no one ever gets good at it.  Good mangers and bad managers are both right about a third of the time.  The difference is good managers quit doing stupid things sooner.  They have less ego involved in their original decisions and learn from mistakes.

For good managers, every reversible decision is a candidate solution.  Kill bad decisions and let good ones run is a winning method.

Good results evolve.  Learn how and when to quit.

Don Shaughnessy arranges life insurance for people who understand the value of a life insured estate. He can be reached at The Protectors Group, a large insurance, employee benefits, and investment agency in Peterborough, Ontario.  In previous careers, he has been a partner in a large international public accounting firm, CEO of a software start-up, a partner in an energy management system importer, and briefly in the restaurant business.

Please be in touch if I can help you.  don@moneyfyi.com  866-285-7772

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2 Responses to Making Decisions

  1. John Page says:

    Our brain is constructed to take orders from the mind (will, intellect, and emotions). All decisions are either positive on negative. No decision is always negative. It’s also habit forming. The latest brain research says that 75% – 98% of all diseases are as a result of our thinking. This is important stuff. Even more important than making the right decisions about money.

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