The Art and Science of Good Decision Making (and What to Do When You’re Stuck in Decision Deadlock)

The Art and Science of Good Decision Making (and What to Do When You’re Stuck in Decision Deadlock)

There’s no denying great things happen when you put smart people in a room together. But there’s also a major downside to working as a team: the dreaded decision deadlock.

Smart people have opinions. And they don’t always line up. But to keep your company moving smoothly, you need to have a decision making process in place for when things grind to a halt.

As Farnham Street’s Shane Parrish puts it: “Good decisions don’t ensure success but bad ones almost always ensure failure.”

Good decision making depends not just on having enough (and the right) information, but in weighing prediction and judgement, understanding the mental biases we all fall victim to, and a deep knowledge of the techniques that can break us out of decision deadlock.

For the past 20 years, I’ve helped numerous companies make fast, smart decisions that have resulted in new features, products, and strategies. Here’s everything I know about making great decisions.  

Decision fatigue: How your daily routine sets you up for decision making failure

The sort of decisions we’re talking about—what new products or features to develop, company strategy, and so on—are definitely a group activity. But before we can get into how to make good decisions as a group, we need to understand the reasons why we make bad individual decisions in the first place.

To begin with, multiple studies have shown just how overloaded we are with decisions throughout the day. From what to wear to which route to take to work to what to spend our time on. (I personally use a capsule wardrobe system to minimize deciding what I wear each day!)

In fact, a recent study from Columbia University decision researcher Sheena Lyengar found that Americans make around 70 conscious decisions a day. The problem is, each one of those 70 or so decisions takes mental energy to complete. And the more decisions we have to make, the more tired our brains become.

Eventually, we hit what’s called decision fatigue: Where our lack of energy and focus leads to making poor decisions. In other words, the more decisions you need to make, the worse you’re going to be at weighing all the options and making an educated, research-backed choice.

Before you even get into a situation to make a meaningful decision, you’ve set yourself up for failure.

Group decision making: Why it’s so hard to make decisions as a group

If we’ve already exhausted some of our good decision making energy throughout the day, that problem only gets compounded once we’re in a group scenario.

Not only are you dealing with your own decision fatigue, but you now have to contend with the opinions, personalities, and politics of all the other people around you. Instead of just balancing your needs, you’ve got a group of diverse, opinionated people all trying to be heard!

This leads to all sorts of issues, from procrastinating to pushing the decision to “someday” (which we all know is just another word for never).

Getting stuck when you need to make a decision is frustrating. But even worse is what happens when you let the fatigue set in and make a rash decision just to get it over with. Bad decisions cost you time, money, resources, and in some cases, even the life of your company.

How to make better decisions

It’s easy to make bad decisions. But with the right tools and strategies, it’s just as easy to make good ones. What it all comes down to is three things: awareness, meaning, and action.

We already know that making too many decisions tires us out and kills our judgement. But unfortunately that’s not the only thing that kills our decision-making skills.

The human brain is susceptible to all sorts of psychological biases and heuristics (shortcuts in thinking) that make normally intelligent, rational people make terrible decisions. Put these biases in a group setting and they only get worse. To combat this, you need to know what they are and recognize when you or others in your group are falling victim to them.

Here’s a few of the worst ones:

Groupthink

Groupthink is when the desire for group consensus overrides our desire to present alternatives, critique ideas, or express an unpopular opinion. In other words, when we silence ourselves for “the greater good” even though we don’t believe in it.

Example:

You’re in a team strategy meeting to decide which form of social log-in to use on your new bird-finding app. You’ve been advocating for Facebook and Google. But two-thirds of the group wants to do something “new and different” and use Birdster—a new social network for bird lovers.

Even though you read Birdster is in financial trouble and has had serious security leaks, you defer to the group because you just want to move forward.  

Confirmation Bias

Confirmation bias is when you search out or favor information that confirms your already pre-existing beliefs rather than look at ones that contradict them. It’s why you’re more likely to remember things or like people who agree with you over those who don’t.

Good Decision Making and Breaking Decision Deadlock

Source: http://chainsawsuit.com/comic/archive/2014/09/16/on-research/

Example:

You’re in a strategy meeting the Monday morning after a design sprint and going over the somewhat mixed results of your user interviews. Despite the fact that most people pointed out that the feature idea you proposed wasn’t intuitive or was confusing, you choose to use the one positive quote during a team-wide presentation.    

Survivorship Bias

Survivorship bias is when you only pay attention to people or things that succeeded and ignore all the other people or situations where they failed. In other words, when you fall into the trap of saying “Well, Elon Musk only has 5-minute meetings and he’s a billionaire. So we should too!”

Example:

Your current customers bombard you with a ton of feature requests. And after hearing the same one come up a few times, you decide to spend months (or years) building it. But when it’s finally time to launch, it does nothing to move the bottom line. The group that you’ve built for already self-selected into being your customer, but you heard nothing from the people who maybe tried and churned or aren’t already customers.

Sunk Cost Fallacy

Sunk Cost Fallacy is when you continue doing something simply because you’ve already spent time or resources on it. On some level you might know it’s the wrong thing, but you don’t want the time you’ve put into it to feel “wasted”.

Example:

You’ve spent years building a product that works well on PHP. You’ve hired your technical team around PHP coders and built processes and documentation around it. But then your growth takes off and it’s clear PHP won’t scale. Yet despite this, instead of transitioning to a different framework, you don’t want to give up on all the work you’ve put into building on PHP and continue building new features in it. Rather than go through the effort of “starting over” you say “we’ve put in all this effort. We can’t quit now!”

Analysis Paralysis

Analysis paralysis is when you get overcome with analyzing options and put off making a decision for a later date.

Example:

You’re brainstorming ideas for a new feature and get a ton of great ideas from your team. After a serious chunk of time debating them, you decide that the better idea is for everyone to go off and think about it and have a new meeting to discuss them in a few days. A few days pass and the same process happens over again.

Perfectionism

Perfectionism is when you strive for flawlessness to the point of chasing unreasonable standards and feeling critical of the results.

Example:

You’ve just finished a design sprint and want to turn your prototype into an MVP. But rather than hack together a usable version you can continue to test with users you feel that the first thing your customers see has to be the best possible. In the end, you sink months of development time and resources into building a “perfect” version of your product that ends up failing because you didn’t test and iterate on real world behaviors.

7 Ways to make better (and faster) decisions

Our brains seem to naturally want to sabotage our ability to make good decisions. But we don’t have to let them. Now that we’re aware of some of the many things getting in the way of making good decisions, we can learn some strategies to counteract them.  

1. Establish norms to get everyone on the same page

Making good group decisions depends on a shared understanding of the context, what’s at stake, and who’s involved in the decision. Before you can move forward with actually making a decision, you need to be on common ground.

First, how big of a decision is this? Knowing the context and potential consequences of your decision can help you decide how much time to give to it and who should be involved in the decision making process. One great way to do this is with the 10/10/10 rule. Simply ask yourself:

“How will this decision affect me/the business in 10 days, 10 months, and 10 years?”

Next, ask how much information you (really) need to make a good decision? As we’ve seen, too much information can lead to analysis paralysis. While too little, or a reliance on the wrong information can just as easily tank your judgement. You need a clear understanding of the scope of your decision before you can do anything. As Shopify’s GM of Platform, Brandon Chu, writes:

“Deciding how important a decision is, is the most important decision you can make. For people that make decisions for a living, understanding when one is really important vs. not-that-important is the most critical skill.”

Your goal isn’t just to make the right decision. But to invest the right amount of time in a making a decision relative to its importance.

The final question to answer is, how will you approach the decision? We’ll get into some specific techniques for approaching decisions next. But before then, you need to know the “rules of the game.” Who gets a say? Where will research come from? How will you handle objections?

Studies have found that establishing these critical norms—how groups question and use both shared and unshared information—greatly improves the quality of decisions made. In other words, groups need to feel comfortable speaking up if you’re going to break free from bias and get the best decisions from them.

2. Understand who the decider will be (and what role they’ll play)

With your norms established, it’s time to decide on another important factor: who gets final say?

Whenever you bring people together you get a wealth of ideas, but also the very real situation of ending up with “too many cooks in the kitchen.” Without a clear understanding of how the final decision will be made, it’s all too easy to just differ to “someday” or give up entirely.

This doesn’t mean you need a decision dictator. But rather that the method of deciding needs to reflect the decision being made and the people involved. There are five common scenarios you can choose from:

  • Decide: The leader of the group uses other group members as sources of information, but makes the final decision independently and does not explain to group members why s/he required that information.
  • Consult (individual): The leader talks to each group member alone and never consults a group meeting. S/he then makes the final decision in light of the information obtained in this manner.
  • Consult (group): The group and the leader meet and s/he consults the entire group at once, asking for opinions and information, then comes to a decision.
  • Facilitate: The leader takes on a cooperative holistic approach, collaborating with the group as a whole as they work toward a unified and consensual decision. The leader is non-directive and never imposes a particular solution on the group. In this case, the final decision is one made by the group, not by the leader.
  • Delegate: The leader takes a backseat approach, passing the problem over to the group. The leader is supportive, but allows the group to come to a decision without their direct collaboration.

3. Set a deadline (and make it non-negotiable)

Parkinson’s Law says that “work will expand to fill the time given to it” and decisions are no different. Without a strict deadline you’re especially vulnerable to decision deadlock. As a group, decide on deadlines, milestones, and limits to conversation (based on the norms you already established).

When it comes to deadlines, set one that is strict, yet realistic. This is a non-negotiable date. We all work better with constraints and knowing you have a limited amount of time to come to a decision will help you look for creative options and keep the conversation moving.

The design sprint process is a great example of this, forcing difficult decisions into a short time frame to maximize real-world learning over getting stuck on details.  

4. Reduce the number of options on the table

As I’ve said over and over, bringing good people together is the best way to come up with great ideas. But when it’s time to decide on a path to take, you need to narrow in on only the best options.

Here’s where it pays to take advice from some of the world’s great writers like Faulkner, Wilde, and Chekov and kill your darlings. In decision making, your darlings are those “good but not great” options you can’t seem to let go of.

As we’ve seen, information overload and analysis paralysis can grind decision making sessions to a halt. We all have a hard time giving up on ideas we think are good. And so if you want to get closer to a consensus, you need to clear space to focus on the best options.

Before you prioritize or vote on ideas, have the group do a pass of what’s on the table. Take a second with each option and see if it gives you pause. Can you get rid of it for now and move forward?    

5. Prioritize what’s left using the Decision-Making Matrix

Hopefully at this point, you’ll have a small list of great options and a motivated group who wants to see this decision happen. But here’s where things get even more difficult. You’ve already killed your darlings, and what’s left is only the best of the best. Still, you need to come out with a winner.

One method for doing this comes from author Chris Guillebeau’s fantastic book, The $100 Startup. In it, Chris outlines a simple prioritization process he calls the Decision-Making Matrix. Here’s how it works:

  1. List your ideas and score each one on a 1 to 5 scale based on a few categories (Effort, Profitability, Vision, and Impact)
  2. Sum the total scores and sort from highest to lowest
  3. Take action on the highest scoring idea

And at the end of this process, you’ll be left with a ranked and prioritized list of which ideas, strategies or features you should pursue—built on the principle foundation of real anticipated impact within your business.

6. Use “dot votes” to come to a group consensus on how to move forward

Another option if the Decision-Making Matrix doesn’t work for you is to bring it to a vote. However, again simply raising hands and casting votes can lead to all sorts of issues and make you vulnerable to even more biases (which I won’t get into here!).

While democracy is a fantastic tool, when it comes to decision making, you need to take a structured approach to voting. One of my favorite methods is to use dot votes.

Dot votes are pretty much what they sound like. Place all your options up on a whiteboard or somewhere everyone can see them with a short description. Give each person in the decision group 3–5 “dots” (you can use sticky dots or something similar). This is a good number as it reduces the friction to cast a vote but also isn’t too many that it’s easy to see patterns.

Now, give everyone a few minutes to review the options and then ask them to cast their votes. Multiple votes can be cast on the same option (so you can put all 3–5 on one option if you feel strongest about it). At the end, tally up the results and hand the results to the decider.

7. Assign a “barbarian” to make sure you’re not falling victim to bias

Despite all your awareness and strategies used to make the most sound decision, biases can still always creep in. In a meta-analysis of 50 years’ worth of judgement and decision making research published by Harvard Business School, one piece of advice for making a difficult decision came up time and time again: Get an outsider’s opinion.

The researchers found that talking to someone detached from the decision has three main benefits:

  1. Reducing your overconfidence about what you know
  2. Reducing the time it takes to make the decision
  3. Increasing your chance of entrepreneurial success

We get so invested in decisions that it can be hard to see past our own beliefs and opinions. Sometimes even just hearing someone explain their thoughts in language you’re not used to can help you gain perspective and see past your biases.

While you might talk to a friend, colleague, or mentor to help bring in a new perspective, the outsider doesn’t have to be someone completely disconnected from the decision. In fact, it can be just as powerful to have someone within your team or even yourself adopt an outsider’s perspective.

This approach is sometimes described as making sure there is a “barbarian” at every meeting—someone who will speak awkward truths clearly and urgently.

Before making your final decision, it’s a good idea to bring someone in who can question your motives and show a different perspective. Even if your decision holds up, it’s a powerful gut check before you commit to a path.

You’ll never get anywhere without making decisions

When you run a company, build products, or work with people you have to make decisions. There’s no denying that. And while decision making is one of the best skills you can learn, it’s rarely taught or even optimized.

There’s no step-by-step or one-size-fits-all solution for making good decisions. However, by understanding all the things that get in the way of making good decisions and then using action-oriented techniques you can push through the noise, stay focused, and make smart, informed, and timely decisions.

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