Laws for Making Good Decisions

(Continued from Last Post)

From Good Decision Makers
Author, Charles Foster, PhD
The Chestnut Hill Institute

Focus on the most important thing.
This seems obvious, but it is the decision-making principle that is most often violated. In every decision, one factor usually is the most important. Concentrate on that element, forgetting all other considerations. Once you’re focused only on what’s most important, the odds are you’ll make the right decision. Everything else is a detail.

Turn big decisions into a series of little decisions.
Some decisions appear overwhelming. You want to focus on what’s most important, but there are so many unknowns that your focus gets blurred. So, make all the little decisions first, and the big decision will essentially be made.

Base your decision on self-acceptance.
Self-acceptance covers a lot of ground…Here are three areas to include:
What you like.
What you’re interested in.
What you’re good at.

Any decision based on who you really are, how you really work, what you really like will probably work out. Ask yourself what you really like and what makes you comfortable. If the decision won’t add to your feeling of comfort, it probably would prove to be a bad decision.

Consider all the good things your decision can bring.
Decision making is, for many people, an exercise in disaster avoidance. Instead of making the decision that might cause something wonderful to happen, we often make the decision we hope will hurt us (and others) the least.

The decision making process must be fueled by the possibility that your decision will lead to something wonderful, a new career, a stronger marriage, etc. Keep reworking the decision until you see it leading to something wonderful. If you rework the decision and nothing wonderful emerges, you risk making the wrong decision.

Get what you need to make your decision a success.
Especially in business, this rule gets broken again and again. A meeting ends with the decision to do such-and-such, but no plans are made to implement the decision.

If there is no passion to implement the decision…or if you know in advance that the resources you need won’t be available…you haven’t decided anything. It is window dressing meant to satisfy someone’s ego or to be included in a report to show your department is on the ball. Start with how you’re going to implement your decision and work backward.

Keep things as simple as possible.
Even smart people break this law. Because they see the big picture, they want the decision to cover every issue that might arise. They draft plans so that no possibility is overlooked.

Example: The more things that can go wrong, the more things that probably will go wrong. Keep the number of things that must go right for the decision to succeed to an absolute minimum. Venture capitalists are justifiably wary of overly complicated plans for a new business. Business plans that are easy to grasp are the ones that are most likely to get funding.

Consider all your options.
I have never met a decision maker (good or bad) who had checked out all possible options. Invariably, I could come up with options they never considered.

Don’t assume you know everything there is to know to make a good decision. Talk to people who are more experienced about the subject than you are. Ask what they would consider when making the same decision. Not only will they present you with new options, their insights could completely change the way you think about the decision.


Full Article and Credits:
http://www.bottomlinesecrets.com/article.html?article_id=27567

Laws for Making Good Decisions

From Good Decision Makers

Author, Charles Foster, PhD
The Chestnut Hill Institute

There are natural laws:

Law of Universe
Law of Gravity
Law of Relativity

There are man made laws:

Law of Averages
Law of Diminishing Returns
Law of Large Numbers

Basically, there are laws that govern in most every subject (civil laws, tax laws, probate laws, etc.). A law can read short or long. They help define parameters, limits and consequences of violation. They are to be abided by, and not broken purposely. They are designed to keep society in order. In all, that’s a heavy criteria for the subject of laws.

Q. Are there laws about making decisions?
A. Here is one submission by an author who looks credible:

“I have spent 10 years studying decision makers…identifying 35 people who

generally make good decisions and 35 people who frequently make

bad decisions... then watching over time as they make big decisions.

My research has led me to two conclusions...”

Good decisions come from disciplined thinking.

If you follow the basic laws of decision making, most of your plans will work out. Think haphazardly when you make a decision, and little of what you plan will pan out.

Good decisions are habit-forming.

Each time you make the right decision, you gain the necessary self-confidence to keep making good decisions. That’s why following the laws of decision making are essential.

So, here are Seven Laws for making great decisions:

[Continued in the Next Post]

Zillion Dollar Thinkers

A wake up call

From the book: Zillion Dollar Thinking the four leadership examples that were sighted were Gates [opportunity], Edison [commitment], Disney [solution], Churchill [action].

Let’s look closer at Walt Disney: Birth; December 5, 1901 – Death; December 15, 1966. To name a few of his achievements:

First animated film with synchronized sound
First animated film in full-color three-strip Technicolor
First feature length animated film
Multi-plane camera, invented for use on The Old Mill, 1937
First stereophonic sound system for film
First theme park (Disneyland, 1955)
Winner of twenty-six Academy Awards
Inaugural recipient of star on the Anaheim Walk of Stars
Two stars on the Hollywood Walk of Fame
Congressional Medal of Honor
Presidential Medal of Freedom

“What is remarkable about this special thinker is that making decisions

back then vs. today had a zillion obstacles and little technology.”

We reviewed an archived article comparing 1903 to today.
Consider these surprising facts:

-In 1903 the average life expectancy in the US was forty-seven (47) years
-Only 14 percent of the homes in the US had a bathtub
-Only 8% of our homes had a telephone [and a three-minute call from Denver to New York City cost eleven dollars]
-Only 8000 cars were on the road and the maximum limit of 10 mph
-Alabama, Mississippi, and Tennessee each had a greater population than California
-No Mother's Day or Father's Day
-One in ten US adults could not read or write
-Only 6% of all Americans graduated from high school
-No air conditioners

Ah, those were the times…and in addition:

No internet
No digital
No cells
No satellites
No PCs
No wireless

But now, we demand and receive instant answers in a digital world.

Point is, compared to what our predecessors had to work with, we really have little excuse for not having better and wiser decisions-plans-directions-results today. It could be that what is happening in our government-economy-environment-freedoms…is a blessing in disguise.

It could be a wake up call…a call to action.

In Disney’s era, the environment for making important decisions was much more difficult and challenging, but look at the achievements.

Today, with all our high tech advantages, we have the opportunity to act with revelation, motivation, innovation and creation at the speed of thought. Our challenge is not to repeat history, but to make history.

Decisioning as a Competitive Advantage

(Highlighted in the last post)

Companies and organizations make decisions daily. Insurance, cars, rent, perks, advertising, technology…and so on. But, in today’s economy, how many are making a conscious decision about decisioning?

As previously posted, we chronicled the BP fiasco right down to the essence of the problem…the lack of decisioning at most every level. In fact, if you will look back at many of our ZDT archived posts, you will find a definite trend. And, because it is so obvious; we have to wonder why it’s being avoided and repeated…almost on purpose.

The time has finally come (and hopefully not too late) for many companies to apply the word how to this often overlooked issue.

The “how,” when applied to objective decision making [decisioning], could completely refurbish worn out and status quo approaches in many of today’s challenges. The trend that we continue to see is not the understanding of the problem, or the ability to come up with some solutions, but the consistent lack of a model of how the process is established and adopted as a standard within the organization.

A key statement from the previous post:

Develop decision making as a core competency
“When you look at successful companies, they all share one common trait…they make good decisions. When you look at mediocre or failing companies, they all seem to have made bad decisions. Yet surprisingly few companies actively cultivate decision making as a skill set for their leaders and managers. When they have, the results have been extraordinary.”

“Improving decision making can even become a competitive advantage”

The steps of what a model might look like, as applied to decisioning, could be as follows:

Is it an opportunity (or problem) area for our company?
How deep is our commitment (or not) to achieve it?
What is the best possible solution (or solutions) in our situation?
What will our specific actions (and accountabilities) be?

Regardless of the particular model that is adopted, the key is to have one, and that it becomes revolutionary in your organization. So, if your competition continues to ignore the importance of a model in objective decisioning, you may have a legitimate competitive advantage. And, if the other companies neglect it long enough, they may no longer be anyone’s competition.

Good Decisions Are More Important Than Ever

“We have seen the collapse of some major corporate institutions

because of one common failing; they made bad decisions”

Consequently, they failed to understand the unconstrained risk associated with financial derivatives such as Collateralized Debt Obligations and Credit Default Swaps. They failed to consider the longer-term consequences of decisions that had short-term benefits. They failed to comprehend the risk of complex decisions and how decision risk can escalate. Some ignored making critical decisions, because they just never got around to addressing them. Some simply and blindly followed the decisions of others [herd mentality].

While we need to learn the underlying lessons from these decision failures, we also need new strategies for making business decisions so we don’t repeat the past in a different form. Good decisions have always been fundamental for business success, but now this is more important than ever. In today’s uncertain economy, it is nearly impossible to make confident assumptions about the future when making decisions. At the same time, there is less room and tolerance for bad decisions, compared to the previous decade when most bad decisions could be reversed, overcome or hidden with subsequent decisions.

“Today one bad decision can cause a major setback or even kill a company”

To compete successfully in today’s economy, companies need to adopt new strategies for making decisions. Here are a few examples:

Work harder on major decisions
While most executives usually intend to put sufficient work into their decisions, all too frequently they just don’t spend the necessary time. Today this is inexcusable.

“There is zero tolerance for poor decisions”

In the past for example, executives might spend 10-20 hours on an important decision, today they need to spend ten times that amount of time.

Understand decision risk
The recent economic collapse was caused largely by executives’ failure to understand the risk of major strategic decisions. Understanding decision risk takes effort and is not as exciting as visualizing benefits. We recently learned all too painfully about the consequences of failure to understand decision risk, and it is now irresponsible to say “I just didn’t consider that risk.” Decision risk is not easily understood; in fact, many executives have never learned techniques for sufficiently appraising the risk of their decisions.

Take decisions step by step or try them on for size
Many major decisions are best made by adopting a step-by-step approach rather than making a full commitment up front. Another technique that is increasingly important is to try a decision on for size before making it.

Develop decision making as a core competency
When you look at successful companies, they all share one common trait…they make good decisions. When you look at mediocre or failing companies, they all seem to have made bad decisions. Yet surprisingly few companies actively cultivate decision making as a skill set for their leaders and managers. When they have, such as the phase-based product development decisions mentioned above, the results have been extraordinary.

“Improving decision making can even become a competitive advantage”

Don’t hesitate to make bold move decisions
Being cautious in today’s uncertain economy does not mean decision paralysis. In fact, now may be the best time to consider bold move decisions. The shifting economy provides many new opportunities for courageous businesses to make bold move decisions. These just need to be objective and well thought through decisions.

Boards of Directors need to play a bigger role in major decisions
One of the biggest questions raised in the recent collapse of major institutions such as Lehman Brothers was:

“Where was the board of directors when these decisions were made?”

Directors should not be involved in micromanaging a business, but they should care about the incentives, diligence, and skills applied to major decisions, and they should use their experience and wisdom to review major strategic decisions before they are made.

In many ways, the abrupt decline of the economy and its dramatic impact on business should serve as a wake-up call for better decisions and more focus on decision making as a skill, if not we will face even greater disasters in the future. It’s not a call for more sophisticated decision making, but it’s a return to the basics of due diligence, common sense, and hard work.

Author, Michael E. McGrath is an experienced advisor to executives, former CEO, executive chairman of Thomas Group, and author of Business Decisions! – How to Be Decisive While Reducing Risk in Today’s Economy. Full article and credits:
http://www.halllc.com/2010/08/good-decisions-are-more-important-than-ever/

ZDT Author’s Comments:
This looks specifically written for corporate applications, but after careful review, many of these points apply to individual challenges. Very insightful and extremely timely.

Zillion Dollar Thought

We each have a zillion thoughts over our lifetimes. Considering all the people since the beginning…that’s Zillion Dollar Thinking!

Deciding for a Living

Back in 1998, Joey Reiman wrote the book Thinking for a Living. It’s all about how he transitioned from getting paid as an advertising agency to getting paid simply for thinking. Remarkable.

He goes further to state that he generates ideas as a product of thought, and gets paid a million dollars and more for such ideas. His big shift came when he realized that in order to be really creative; he needed the freedom from client restrictions, plans, deadlines, etc. to generate “ideation” [the thought process]. And, clients were willing to pay the price for Brighthouse to generate those valuable thoughts. Their mantra and headline is:

"Money doesn't create ideas. Ideas create money."

Having been in the ad and marketing business most of my life, I was intrigued with this concept and thought process. So, I’m thinking (my own ideation), what if we substituted the word “thinking” (from then) with the word “deciding” (today)?

If we really think about it, our decision process generally precedes our solution (bright idea) process. The reason I bring this up now is becoming more and more obvious. If corporations are willing to shell out millions for the next great idea…what price should they be willing to pay for an equally important and great decision?

Case in point; BP and the oil dilemma. We posted, early on, the documentation of where and when the story began to have cracks. And, what is clear is that the decisions being made at most every level were flawed, misinformed and carried little accountability. So, now look at the price tag for that fiasco…with no end in sight.

Here’s the deal. The decision process is increasingly a vital issue. It transcends the idea, the creative, the sales and about any other objective. Question: If BP had it to do all over again, would they have rather paid for a great commercial idea or for sound decisions that would have governed and directed their actions related to this (and other) oil rigs?

Please understand, we are not minimizing the value of commercial ideas (we live by them too). It is just that, increasingly, the failure rate of “decisioning” at the highest levels is becoming an international epidemic costing way more than what is being paid for ideation.

“Think about it...and you decide”

Decisioning Out of the Box

The decision before the decision

This is the one that was made before you even showed up. This is the one that sets the agenda, determines the goal and establishes the frame.

The decision before the decision is the box.

When you think outside the box, what you're actually doing is questioning the decision before the decision.

That decision is far more important and much more difficult to change than the decision you actually believe you're about to make.

Seth Godin

http://sethgodin.typepad.com/seths_blog/2010/08/the-decision-before-the-decisio.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+typepad%2Fsethsmainblog+%28Seth%27s+Blog%29

ZDT Author’s Comments:
Posted with permission. This guy is good.

Blah, Blah, Blah or Blog, Blog, Blog?

(Our Zillion Dollar Thinking 100th Post)

“The experts say that a blog does not even start until it has

at least 100 posts…Now, we understand that wisdom.”

Since this is our 100th ZDT post, we thought we would do a little measuring to see if we stand the test with some of the experts who have blogged for years. Here’s a few of their comments and insights:

Blogging is all about other people. You don’t start a blog to talk to yourself. You start a blog for the dialogue. The real value of blogs is in the interaction between the readers and the blogger. The best insights come from the spontaneous conversations that build up around talking points.

You need to be productive when you “blog”. I don’t care how you define blogging, but it’s an activity that can add up to many hours in a day, so you have to monitor your time in order to be productive. You’ll spend your time looking for information, researching, commenting in other people’s blogs, and writing. It’s all time consuming, so make sure your time is well spent.

The same principles that apply to gaining success anywhere, apply to the world of blogging. Blogging isn’t a discipline that exists in isolation, and it’s not a wholely unique concept. Rather it’s an evolving medium that works like many other human endeavors. You’ll have winners and losers, laughs and tears, and everything in between. Be realistic and know that consistent hard work is the only thing that can help you.

Blogging is a marthon and not a sprint. If you’ve been blogging for a few years and feel fatigued, wondering if it will all pay off, keep in mind that there are people who’ve been blogging for 10 years or more! Tell them how you think you should have more success any earlier. And even if you have success at your blog for awhile, it’s not guaranteed it’ll last. Blogging is all about working for the long term.

“Whatever you do, don’t give up on making blogging

the very best profession or business you possibly can.”

As we look back in review and with just these few insights, I believe we have embraced a few, but in all, we have much work to do. So, here are some of the benchmarks we will strive intend to reach in the next few months:

We will invite, incent and create more traffic and more dialogue
We will get to the more practical applications of decisions in buying and selling
We will continue to stress the importance of using objective forms, structures and systems
We will be developing an e-book
We are developing a “Zillion Dollar Think Tank”

We have written many posts around the importance and crying need for objective decision making as a thinking habit. Moving forward, we will heavily emphasize actionable decision making as a privilege (not a guarantee) we too often take for granted.

A zillion thanks to our readers…on to 101.

Decisioning Comparison Criteria

(Please Consider Bookmarking)

When evaluating your current decision making position or system, you may consider comparing it to the following criteria:

Does it:
Provide and demonstrate a simple, tangible, objective and visual structure

Develop easily, is immediately understood and transferable at most ages (young or older)

Use a process that preempts the focus on products, services and issues
(by creating an early buy-in assessment tool)

Create a standard decision model with specifically linked steps to be followed

Have the "right of passage" that is based on interactive agreement and commitment at each step

Provide a logical tracking system that mimics the way that we naturally think and decide

Include an extra-dimensional assurance through “decision evaluation calculators”

Provide the mechanics to find where and if a breakdown in the decision process may occur

Become the standard/crucible where all your important decisions can be measured and analyzed

Generate qualification and/or buy-in early within the process

Flesh out the mantra of “The more it is used...the more it can be relied upon”

Offer the unparalleled legacy to sow and plant within a family...a sound decision making model

Solve the fundamental need ...the need to make more objective and reliable decisions

These are but a few of the analytical comparison traits of a classic decision making model. If you are now using a system that is working…by all means continue, but please share it. We would welcome any and all responses of successful systems. After all, the goal of this blog is to bring awareness and solutions to the gnawing problem of objective decision making.

Note:
The above criteria is the answer to the question: Why does the MODELTM System work (from the book Zillion Dollar Thinking)?

Four Psychological Types of Decision Makers

Intuitives: They are led by intuition; concentrate on the possibilities; avoid the details and tend to look at the bigger picture.

Thinkers: They are analytical, precise, and logical; process a lot of information, often ignoring the emotional or feeling aspects.

Feelers: They are interested in the feelings of others; dislike intellectual analysis and follow their own likes and dislikes; enjoy working with people and are capable of great loyalty.

Sensors: They see things as they are; have great respect for facts; have an enormous capacity for detail and seldom make errors; are good at putting things in context.

FYI…Lessons from Michael Dell

"In leadership, it's important to be intuitive, but not at the expense of facts," writes Michael Dell, Founder of the Dell Computer Corporation. "Without the right data to back it up, emotion-based decision making during difficult times will inevitably lead a company into a greater danger. There is a very easy way to test whether you're making decisions based on emotions. When you come across data that is strikingly different from what you previously thought, how long does it take for you to shift your thinking? Do you deny the data and say, "Well, I don't believe this?"

ZDT Author’s Comments:
The repeating dichotomy is that facts and emotions are in constant conflict when making decisions. The key is to be able to manage your decision, with these competing factions, through a process that gives you a more predictable result. We know of at least one.

Zillion Dollar Thought

“The average bed is home to over 6,000,000,000 dust mites…considering all the beds since the first one…zillions.”