Decision-making models for change – Part 1
Decision-making models provide us with a framework when it comes to mastering change. In the next few weeks, I will be looking at a number of models which you can apply to the evaluation of different choices. In this first post, we examine:
- Drawing on the Past Model
- The Paradox of Choice Model
- The Crossroads Model
Throughout our lives, we face big decisions that have a lasting impact on the future: getting married, moving to a new house, developing a new product, employing an assistant. But by choosing to be a homepreneur you have already made a momentous decision. Don't underestimate the magnitude of leaving the relative safety of the corporate world.
Whether you actively chose to work from home or it’s a result of being made redundant, you didn't take this path lightly. It may have been a specific event that tipped you over the edge or a long, drawn-out process that involved evaluating risks and benefits. If you decided to change career, the decision was even riskier than continuing in the same field, as it probably required retraining. How did you come to make these decisions?
1. Drawing on the past model
The decisions we made in the past can help inform choices in the future. Reflecting on these past decisions is a model developed as a visual planning system by The Grove Consulting Agency. This involves drawing a timeline from a recent major decision to the present day. Mark your specific goal on it at the time you made the decision:
- What choices did you have to evaluate?
- What factors did you take into account?
- What obstacles did you overcome?
- What have you learned as a result?
- What have been the successes?
- What resources were required in terms of budget and time?
The answers to these questions will enable you to draw on the experiences of your past to help make decisions in your future. Going through this exercise will help you create a personalised decision-making model.
2. The paradox of choice model
You’d be forgiven for thinking that the more options we have the better and, consequently, the better the final decision. Frequently, more choice makes deciding on a course of action much more difficult. It also results in having higher expectations for the results of making a particular choice.
This ‘paradox of choice’ was examined by American professor of business, Sheena Iyengar. She conducted an experiment in a supermarket, offering six different flavours of jam to shoppers on one day and twenty-four on another. When only six were on offer, 40% of shoppers tasted the jam and 30% bought a jar. Interestingly, when faced with the wider choice, more shoppers participated in the experiment. But although 60% of shoppers took part in the taste test, only 2% went on to make a purchase. The vast selection made the choice just too confusing.
What do we learn from this? If you’re faced with multiple options, don't be surprised if you choose to remain with the status quo. Evaluate one option against another, select the best and then repeat the process until you’ve covered all the choices. The more variables you add to the decision-making process, the less likely it is that you’ll come to a satisfactory conclusion.
It's important to remember that every decision we make has at least two outcomes: first, to move ahead with the change, and second, to do nothing at all.
The importance we give to a decision will be in direct proportion to its consequence. If an expected outcome has little or no consequence, then the decision is relatively simple. Mulling over simple decisions isn’t a good use of your time. As the phrase goes, ‘don’t sweat the small stuff’.
When it comes to making decisions for your business, I would recommend comparing three or four alternatives at a time. For each additional choice added into the mix, the number of comparisons increases exponentially. For example, if there are three alternatives there will be three comparisons to make – A versus B, A versus C and B versus C. For four alternatives there are six comparisons and for eight there are twenty-eight! Keeping your choices to a manageable number will ensure you actually reach a conclusion that will help you move towards your goal.
3. The Crossroads Model
When it comes to making big decisions, Crossroads Decision Making Models will help to steer you in the right direction, by posing a series of questions for you to answer.
- Where have you come from?
What have been the most important successes and failures in your life? How did you overcome the challenges?
Think about the decisions you have made in the past about your education, career choices and personal life. There's no right or wrong answer, just a statement of how you view the past.
- What is really important for you?
Take just three Post-it notes and write down the first three things that come into your head. On the first, write your most important value. On the second, what you believe in and finally, what is important to you when all else fails? Don’t overthink this – it’s what comes instantly to mind.
- Which people are important to you?
Think about the people you look up to and admire. Who are they? Additionally, consider the people you care for most.
- What is holding you back?
We all have limiting beliefs. These are thoughts that get in the way of you achieving our goals. What are yours? Is it your age, lack of money, family commitments, lack of education, the need to acquire new skills or lack of a mentor?
- What are you afraid of?
This question gets to the heart of why we might avoid taking a particular course of action. Maybe it’s the fear of failure or even the fear of success. It could be losing money or being seen as a fraud.
Once again, there are no right or wrong answers to these questions. The purpose of this exercise is to paint a picture of you as a person. Having answered these questions, imagine a signpost indicating six alternative roads:
- the road back to where you were safe
- the familiar road you have already been down
- the road that beckons: a path you have always wanted to try
- the road of dreams: regardless of whether it's achievable or not
- the road most sensible: the one that people whose opinion you value would suggest to you
- the road not travelled: a place you have never even considered
Picking one of these paths will depend on how confident you are in the assumptions you have made about each alternative and the level of risk you are prepared to take. It may be that you decide to make a small change or pivot to your business as opposed to a wholesale change.
Having a process for implementing change by adopting a model which encompasses the head, the heart and the gut, is useful not only in our professional but also our personal lives.
More Decision-Making Models
In Part 2 I will explain the Decision Matrix Model.