Decision Making (30 min)
Decision making, like discipline, is one of the core skill sets needed to achieve your goals. Understanding the decision-making process, your preferred decision making style and having a framework for decisions will help prevent you from being distracted or pulled away from your goals.
The decision-making process is relatively straightforward and is outlined in the diagram below.
While pursuing your wealth building strategy, you will face many obstacles. These obstacles simply represent problems that need solutions to progress. The more efficiently you move through these problems using the decision-making process, the faster you will achieve your goals. However, while the steps in the process are the same, the method you approach them will depend on your decision-making style. Knowing your preferred style and how it relates to different types of problems will allow you to manage the process and delegate as needed to remain efficient and focused.
Your preference for decision making style will depend on where you fall on two spectrums. The first is your tolerance for ambiguity versus certainty and structure in regard to the availability of information. The less tolerant you are of uncertainty, the more time you will take to collect information and look at alternatives.
The second factor is your preference to make a decision that is correct or optimized based on the technical data or optimized based on the impact to people or society, regardless of objective truth or evidence. The more people-oriented you are, the more collaborative you will be in your decision making and again, the more time you will take to make the decision due to seeking suggestions and socializing potential solutions.
The following activity will help you determine your decision-making style.
First, place a point on the vertical line of the axis below that shows where you are on the spectrum between needing a structured environment with access to large amounts of data and time to make decisions and being comfortable with less information and less time, but within a more creative environment.
Next, place a point on the horizontal line of the axis below that represents where you fall on the spectrum of either being comfortable making independent decisions based on the data or for working more collaboratively with others to collect, evaluate and select solutions that fit the group.
Finally, draw a line across from the point on your vertical axis and up from your horizontal axis to determine where the lines cross. The point will fall into one of the following four quadrants that will represent your preferred decision-making style. This does not indicate that you cannot make decisions with other styles, merely your initial preference.
Now that you’ve completed the above activity, compare your results to the matrix below to learn more about your self-identified decision-making style. Keep in mind that there is no right or wrong decision making styles. Our objective is to identify your natural preference so that you might match your style with the types of problems that are best resolved using your particular style and help you identify other decision makers best suited for solving other relevant problems.
You might use an analytical decision maker, such as a subject matter expert, to independently develop a list of innovative solutions to a problem and then provide you with an opinion of the highest probability result. An example might be a consultant that is hired to assess renewable energy supply options for a local school system.
You might use a conceptual decision-maker to consult a wide network of individuals to identify a breakthrough solution to a problem that will have wide acceptance. For example, a product development manager who must launch a new product to the market could assess the potential acceptance of various product features and geographic availability.
You might ask a directive decision-maker to make rapid or repetitive decisions based on a set of pre-defined options or available data in a known environment. For example, a line manager at a manufacturing facility makes decisions to rearrange the work schedule based on production changes.
A behavioral decision-maker might be best suited to make rapid assessments of problems affecting and existing groups of people that requires broad acceptance. One example might be a human resource professional asked to facilitate negotiations with a worker’s union.
Once you know your decision-making style, you can incorporate it into a framework that filters and prioritizes actions to minimize decision-making fatigue. The traditional Eisenhower Matrix provides a reasonable model that quickly weeds out unimportant tasks and identifies areas to delegate or delay. However, the Eisenhower Matrix doesn’t give you guidance on determining the definition of urgent and important. In other words, it doesn’t differentiate an action as one that is urgent or important to YOU specifically or just in general. Therefore, it is still possible for other people to hijack your time, talent, and treasure by applying external pressure to create artificial urgency.
Wealth Advantage recommends using your passion, goals skill sets and decision-making style as filters before applying the traditional Eisenhower Matrix.
If the activity or decision is not aligned with your passion and goals, it should be declined or referred to someone whose passion is better aligned. If it is aligned with your passion and goals but does not match your skill set or decision-making style, then the task or decision should be delegated to someone more capable of developing a more optimal solution in a shorter time.
The purpose of a decision-making model like this is to free up your time to focus on those things that you want to be intentional about and that utilize your strengths to create high value. Time will be necessary to get comfortable with this type of analysis and it may be helpful to use the following flowchart to keep you consistent in thinking through your activities. Eventually, this process will become internal, and you will find yourself recognizing very quickly when new tasks or problems pull your focus away from your goals and strengths.