Conventional wisdom says we each make 35,000 conscious, sub-conscious and unconscious decisions a day.
These decisions might crop up in a business or professional environment, in our personal life, in our circle of family and friends, or in a community/public context. Some are far more important than others, of course, and sometimes a seemingly minor decision can flow on to major consequences.
So, given the number of decisions we are faced with every day, how do we ensure we are making the best calls where it matters?
The value of a decision
My background and training is all about the value of weighing up a decision. Let’s take something close to our business hearts: how should I quote or charge for a project or piece of work?
My concern is getting the balance right between raising revenue for my business and setting a pricing strategy that properly reflects the value of my ongoing work and my worth to this business.
It comes down to a value exchange – what am I receiving from making this decision and what am I giving away? In some cases, it’s a matter of weighing up an immediate benefit against longer-term consequences, or vice-versa.
I often talk to people about ‘value’ when it comes to decision making. This may mean thinking about not just the course of action you have chosen, but the potential cost (or otherwise) of forgoing other options.
Avoiding decision fatigue
Studies show that once decision fatigue sets in, we avoid making decisions or, worse, make bad decisions.
Imposing some self-discipline by giving structure to the process will help mitigate this. As an example, you might set aside some time on Sunday afternoons to plan what decisions you will make that week.
Also, make sure you don’t try to deal with key decisions when you are distracted, hungry or otherwise not in a good frame of mind.
The importance of a decision depends on the impact it will have on you, your business and/or others, and how much those consequences matter to you and others:
- Is the result of this decision critical (eg. ensure or destroy your business or relationships)?
- Is this decision important (eg. strengthen or weaken business success or relationships)?
- Is this decision incidental (eg. a small improvement or an inconvenience)?
- Is this decision a minor, trivial or a petty matter that won’t greatly affect your business or personal life?
Ranking your decisions will help you prioritise and put things in perspective when faced with a daunting decision load.
Three steps to decision making
The following steps will help you approach your decision making in a strategic way:
- Categorise decisions as strategic (related to planning and longer-term goals); tactical (requiring action in the shorter term); or in the moment (critical or requiring immediate action). Strategic decisions can be put on your fortnightly or monthly list. Tactical decisions should be on your weekly planner. ‘In the moment’ decisions speak for themselves and should be the only decisions made outside of your structured plan.
- Conduct an impact analysis. What are the potential consequences for you and others (within the relevant context – ie. business, personal, family/friends, public) and what is your care factor?
- Assess your risk appetite. How brave will you be in making this decision? What is the worst thing that might happen as a result of this decision?
Reviewing your decisions
Be prepared to learn from the decisions you have made and the way you went about making them. Consider not only whether you made the ‘right’ decision in terms of impact or consequences, but whether your planning and prioritising worked effectively.
In other words, did you create value in all aspects of your decision making?
Paula Kensington is the new LBD CEO and an award-winning CFO and finance, futurist. She is passionate about people, planning and possibilities. Paula is available for keynote presentations and conferences. She also loves talking to employee groups, in town hall style meetings or smaller talent pools, where her experience and passion for the future helps to alleviate anxiety in the workplace, at all levels of an organisation.