One of the things that managers are call on to do a lot of is making decisions. We make them all the time. We also find ourselves making big decisions and little decisions. We make decisions that really don’t matter all that much and we make decisions that can have big impacts. It’s this last category that seems to cause us the most problems. We worry about these decisions. Did we make the right decision? Should we have made a different decision? We need to come up with a way to make the right decisions.
It’s All About Making Decisions
We all know managers who overthink seemingly simple decisions. At lunch these are the ones who cause the line at the sandwich counter to stack up while they try to decide between banana or cherry topppings. These are the managers who make the fulfillment department twiddle its collective thumbs while they decide whether to expedite the shipping on a late order. Over at Amazon Jeff Bezos says that these managers assume most two-way door decisions (easily reversible) are one-way door decisions (almost impossible to reverse), and wind up making very few decisions at all.
The chances are, you may also consider yourself an overthinker. In a recent survey over 99 percent of the 10,000 people surveyed said they often overthink. Research that has been done shows that most of us spend surprisingly little time when we are making major decisions. A good example of this are personal finance decisions. More than half of us spend as much or even more time planning for our next vacation rather than planning our financial futures. Or when we are buying a car. Half of us visit just one dealership when we are buying a car, and 1 in 6 will skip a test drive. How about when we are buying a home? The average home buyer will visit just four properties before deciding to make a purchase.
As a manager we all ask ourselves the question – maybe this is us. Maybe it’s not. One way to find out is by playing a simple game. Start by imagining there are two jars. One will contain mostly yellow balls with a few green ones mixed in. The other will contain mostly green balls with a few yellows mixed in. You are given one jar and told to take out one ball at a time. Your job is to stop when you think you know whether the jar you have has turned into a green ball jar or a yellow ball jar. Let’s say that you can pull out up to 5 balls. When would you stop? If you stopped after you pulled the first ball, you definitely tend not to overthink. If you stopped after the second ball, you’re a little less likely to jump to quick conclusions. At this point in time if you still haven’t stopped, you tend to like a lot of data before reaching a conclusion.
Let us agree that this is a silly game. However, researchers have determined that the less “data” a player needed to see, the more errors they were likely to make in decision making and reasoning. These players jumped to quick — and incorrect — conclusions on brainteasers. They were more likely to be tempted into making inferior bets when dealing with gambling tasks. They also tended to be overconfident — even when they turned out to be wrong — in the accuracy of their knowledge about the decisions that they made.
How To Make Better Decisions
Our goal is to be able to avoid jumping to conclusions — without becoming an overthinker in the process. One way do this is to embrace the Jeff Bezos’ 70 Percent Rule. Here’s what Bezos says: many decisions are reversible, two-way doors. Those decisions can use a light-weight process. Most decisions should probably be made with somewhere around 70 percent of the information you wish you had. Some decisions are consequential and irreversible or nearly irreversible — one-way doors — and these decisions must be made methodically, carefully, slowly, with great deliberation and consultation. If you walk through and don’t like what you see on the other side, you can’t get back to where you were before. But most decisions aren’t like that — they are changeable, reversible — they’re two-way doors. If you’ve made a suboptimal two-way door decision, you don’t have to live with the consequences for that long. You can reopen the door and go back through.
The next time a manager struggles to make a decision, you need to first determine the consequences. What you will have for lunch? Really doesn’t matter. Whether you expedite shipping? Probably matters, but the cost-benefit consequences are pretty easy to calculate. In either case, overthinking these decisions is a waste of time. Decide whether you should fire an under-performing employee? The consequences can be huge, for your business and the employee. And if you do decide to fire him, there will be no going back. Which makes it a decision that you probably can’t overthink.
What All Of This Means For You
Making decisions is what being a manager is all about. If you think about it, we make many different decisions each day. Some of the decisions that we make are small an inconsequential. Some are big and can have a great deal of impact on a lot of people. Where things get tricky is if a manger struggles to make decisions. If they take too long to make their mind up. How can we deal with situations like this?
We all know managers who struggle to make even the simplest of decisions. There is a very real possibility that you may be an overthinker who spends too much time making decisions. We can answer this question by playing games that require us to make decisions. In order to make better decisions, we can use the Jeff Bezos technique. This requires us to evaluate the decision that we are making and determine if it is a one way or a two way door. If it is one way, then we need to take our time in making a decision. However, if it is a two way decision then we need to move quickly.
One of the key things that managers need to realize is that there are other people who are waiting for us to make a decision. This means that we need to hurry up and make up our mind. Using the Bezos technique, or some other technique, can allow us to make our decisions faster and prevent ourselves from getting trapped by making bad decisions.
– Dr. Jim Anderson
Blue Elephant Consulting –
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What We’ll Be Talking About Next Time
Managers know that the problems of today will probably end up being solved by the workers of tomorrow. The challenge that we face, on top of everything else that we have on our plates, is that we need to be using our manager skills to find and attract those workers who will be solving tomorrow’s problems. What this means for managers is that we have yet another job that we need to accomplish: find and attract the workers of tomorrow today.