Effective Decision Making

Decision making, well sometimes it gets really impossible to decide for the best among all the billions of appealing glittering options available to us, and each one of these decision can shape one’s life in every unique way. So all of us face this challenge of effective decision making in our life and with the evolution of the modern world the number of choices are constantly increasing for everyone, be it as small decision as picking food from menu at a restaurant or even choosing the restaurant first, or even before that weather you actually want to go out of your comfy room because you always have the option to order online. There are situations when the decision we take have a much greater impact on your life and these decisions are meant to be taken wisely as these are the ones which shape our tomorrow, e.g. deciding the subjects in college, taking up professional courses, medical and insurance policies and so on.

We deal with this challenge of decision making at each and every step of life. So the question is how to evaluate the best decision among all the available choices.

Effective Decision making:

Let's take an example, there is a situation when a person has to take a decision. (let's say our guy is Sidd for this situation and Sidd is rushing to the subway to catch the next tube(train) to reach his office and when he reaches at the door of the train he realizes that there’s no seat available, now he is having the option to board the train and keep standing for next 2 hours till he reaches his office or to wait for next 30 minutes for next train and then comfortably reach his office. Now based on his judgement and evaluation he decides to board the train thinking that reaching 30 minutes earlier to the office can help him make some business and make money out of those 30 minutes. After all time is money.)

Let's evaluate this situation and try to understand our methodology of effective decision making to decide whether the decision taken by Sidd is a wise one or not.

First thing we are going to do is to analyses the situation, for doing that we will identify the decision affecting parameters which can influence Sidd’s decision in the above case.

Let's take into account the parameters we have identified for the situation-

A. Time is valuable and Sidd wants to save time so that he can make some money out of it, and his goal at the moment is to reach his office to make money.

B. Waiting for the next train will make him lose time and equivalently the money value of that time, but he will reach comfortably and he will be more energetic and productive for the day, so effectively he will be happier and contented with his work and life.

C. Sidd decided to reach out for saving 30 minutes and make money out of it but standing for two long hours in the restricted area caused him back ache and later in the evening he had to consult a doctor and thus effectively the money made out of the 30 minutes indirectly accounts to zero or may be negative.

Every situation is composed of such parameters which are needed to be analyzed and evaluated relatively (not independently) to take the right decision.

Many a times these parameters can be- money, time, comfort, sentiments, friends and family, law and order, environment etc. so each parameter affects the process of decision making and due to these large no. of parameters the process of decision making becomes tedious and even after taking a decision, our mind keeps on wondering and analyzing the outcomes of other possible options. And we are never sure about such decisions unless we get the outcome.

So to simplify this, we need to reduce the number of parameters for effective decision making, but parameters cannot be eliminated at all, since these are the directing forces for the outcomes of the situation.

Solution-

Parameters cannot be eliminated or ignored at all, but what can be done to effectively evaluate the role of each parameter relative to each other, to shape the decision (by considering each and every possible outcome) is to create a Universal parameter which will be the core value and root for the decision making, as it will be formed by the outcomes of each deciding parameter.

Let's call this parameter ‘LIFE’, so initially we set its value to ‘ZERO’, (for unbiased decision making)

‘LIFE = 0 ‘

Now we give some score to each of the deciding parameter based on its importance and severity (how deeply it affects the situation), along with this score we will also give sign (‘+’/ ‘-’) to indicate whether it favors the decision or not.

So these parameters are now converted in linear vectors with some magnitude and a sign to indicate the direction. We will limit the value of parameters up to ‘3’ which denotes extreme or severe impact on the situation.

Thus,

0 = no impact

1 = slight impact

2= average impact

3= severe impact

Now coming back to our original example of Sidd boarding the train scenario, we have already identified 3 parameters, so now evaluating for each of the parameter.

suppose ‘boarding the train’ is denoted by positive.

Parameter A= +3

Parameter B= -2

Parameter C= -2

Thus now evaluating the value of final parameter ‘LIFE’ by linear vector addition

LIFE = +3 -2 -2 = -1

Inference of value of parameter ‘LIFE’:

Negative symbol shows that he should not board the train, and also the magnitude ‘1’ shows the severity of consequences to be dealt with if that decision is taken. Thus higher magnitude shows very severe impact and thus a high degree of importance of that decision in shaping the future.

(* for LIFE = 0’ we can conclude that the decision is risk free, and there’s nothing to worry about the consequences of accepting or denying one can still decide by assigning the ‘+’ or ‘-’ based on the sign of the parameter having highest severity.)

Thus it indicates that he should not board the train, and it can also be noted that the strong driving force parameter A was dominating B and C in terms of severity, which made Sidd to take the wrong decision, because he was thinking about his sole objective of reaching to his office.

Conclusion:

Thus for each such situation where it is difficult to take a decision, one can always identify the parameters according to his/her circumstances, and assign magnitude and direction to each one. One can even assign fractional values or extend the scale to generate more accuracy and then easily evaluate the universal parameter for effective decision making.