I am learning more about decision-making. This topic can be so vast.
What is a decision? If you asked me in a conversation, I would stumble. I should test it out when talking with people. I donât expect that anyone can speak to it eloquently. Hereâs a simple way of looking at it: a decision is a choice made between alternative courses of action in a situation of uncertainty.
Why do our decisions matter? They shape the trajectory of our lives, influence our personal and professional growth, and determine our overall well-being and success. In endurance and entrepreneurship, they affect our ability to succeed, overcome challenges, and achieve long-term goals. Making decisions is part of strategy. I think of strategic and non-strategic decisions.
Strategic decisions are long-term, high-impact ones that shape the overall direction and goals of a personâs life or an organization. They could involve significant resources, substantial risk, and consideration of the broader environment.
Non-strategic decisions can include operational and tactical decisions. They are more immediate, routine, and involve less risk and resource commitment. These decisions are essential for day-to-day functioning and short-term goals. They may not significantly alter the overall direction.
How do we judge the quality of our decisions in the past?
We first consider the results of those decisions. We reward peopleâs decisions based on outcomes. In a more structured decision-making process, we also evaluate the process. However, which is more important when evaluating a decision, outcome quality or process quality?
Two key takeaways for me when learning about decision-making are:
- Separate Process from Outcome
- Focus on Process, not Outcome.
Itâs probably obvious that if we have time, and we normally do for strategic decisions, we should have a clear process for making decisions.
The counter-intuitive aspect is that Process is the clear winner to reward.
If you reward based on good outcomes, you can accidentally reward Bad Break (decisions made up of a bad process with a good outcome)
If you punish based on bad outcomes, you can accidentally punish Bad Breaks (decisions made up of a good process with a bad outcome).
We donât want to reward Dumb Luck and we donât want to punish Bad Breaks.
So thatâs it for today. How we evaluate decisions influences our next ones. Therefore, focus on the quality of decision-making, not the results.
If I had time, I would investigate the steps of a good decision-making process next. I would certainly turn to ChatGPT to remind me of those steps and help me improve and learn from my decisions.
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