Top Down Or Bottom Up

Top down planning is useful. It is the preferred method of governments, parents, teachers, and bosses. People prefer it because it looks like an answer to a problem or the way to exploit an opportunity. It is a way to help.  Greater experience and skill should be applied efficiently.

It has some limitations though and the way you implement will point out the ones that presently apply.

It always works when the person providing the methods fully understands the situation, has dealt with similar problems in the past, is aware of how the available tools fit and knows how people will respond to direction.

If I want a teenager to paint their bedroom, I might be able to create a top down plan. Here are the tools, go to the paint store and pick out a color, help move furniture, masking tape, here is technique for edges and rolling the paint, wait to dry, second coat maybe, cleanup and we’re done.  A straightforward task with limited resources and options. Not too demanding mentally or physically.

The context of the solution presented is seldom fitted that well.  Bureaucracies usually have ambitions that are greater than their understanding of the the context. Parents do it to save time. So do bosses. To be fair most worthy problems are too complicated for a set of instructions that will solve them, but that does not deny the attempt.

That’s when bottom up comes to the fore.

Bottom up begins with observations and ideas about why they happen or how they could be changed. Know the goal, but maybe be willing to modify it a little. 

Try something and see if it works.  If not, try something else and remember what did not work.  Eventually answers begin to appear. It is slow and often tedious but when it is finished the answers fit both the goal and the context. How many light bulbs did Thomas Edison try before getting one that worked.

You can get the best of both styles, but you must be humble.

Start with top down, using the best experience tools and skill that you can find. That’s why we have education.  To transmit solutions. To save the searching for answers when answers already exist.

The humility comes into play when the top-down answer doesn’t quite fit.  Pouring in more resources to try to make it work usually fails unless there  was a resource shortage in the beginning. Poor planning if so.

Humility says, I did not fully understand the problem. What did I miss and what would I do differently if I had known? That style is bottom up.

The optimal approach is to begin as high up on the top down scale as you can, but be prepared to try exploring as soon as resistance appears. Maybe even quit.

There are many people in every organization who cannot do that. They are too invested in maintaining their image. Politicians particularly are not good at saying, “Well gee that didn’t work.  We’ll try something else.”

Nothing complex, like a financial plan, turns out like it was supposed to. Expects false starts and surprises. They teach. Nurture them.  Most of all, do not continue something you know won’t work just because you are invested in it.

Never let planning ego get in the way of a good answer. Most answers evolve.

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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