How can you make everyday decisions quickly? Answer 5 key questions: 1) What info do I need? 2) What cognitive biases might harm me? 3) What would a trusted adviser say? 4) How might this fail? 5) Why might I revise this decision? This episode of the “Wise Decision Maker Show” provides a videocast and podcast about these 5 key questions that you can use to ensure you make the best everyday decisions, in business and in life.
Videocast: “Are you prepared? || 5 Questions to Avoid Disasters in Everyday Decisions”
Podcast: “Are you prepared? || 5 Questions to Avoid Disasters in Everyday Decisions”
Here’s the in-depth article on the “5 Key Questions”
You can download a poster for your office or get decision aids with the 5 questions for yourself and your employees here.
The book Never Go With Your Gut: How Pioneering Leaders Make the Best Decisions and Avoid Business Disasters is available here.
You are welcome to register for the Wise Decision Maker Course and get a digital version of the assessment for free as part of the course.
Article on the assessment to evaluate dangerous judgment errors in your workplace.
Article on a thorough technique for making important decisions
Article on an in-depth technique for making critically important decisions
Article on a thorough technique to prevent failure and maximize success when implementing decisions
Article on a thorough technique to make wise strategic plans
Article on mental skills and habits to defeat dangerous judgment errors
Hello everyone and welcome to another episode of the Wise Decision Maker. Today we’ll discuss a hack for how you can make better decisions in your everyday settings, so better everyday decisions. Now, disasters in our businesses and our relationships and our personal life often result from a series of small mistakes that adding up together can lead to a lot, a lot of problems. So that’s what you want to avoid. You want to avoid problems in your everyday decision making. And this technique will you help you prevent these problems through investing very little effort, less than five minutes most of the time when you do this technique, to help you make the best decisions in everyday situations. And yes, since I often get asked, you can use this technique for major decisions if you’re facing a true emergency. But there’s much more effective techniques that are applicable to major critical decisions. So I advise you to not use this technique for major decisions unless it’s a super emergency.
So, I’ll admit it. I have a problem with premature email-sending. I tend to be an optimist and risk-blind, so I tend not to really focus hard on thinking about how my email can be misread in more hostile ways. I tend not to think – not to look it three times over, five times over, before I hit send. And I don’t look at the tone, all that stuff. I just don’t look at it, it’s not my intuitive nature to do that. I just want to write them quickly, you know. I get in trouble because of it. So, I’ve really gotten in trouble because of it, because I don’t look through my emails very closely, and I’ll tell you a story when I got in trouble.
I had a coaching client who ran a midsize growing technology company. And he wanted to acquire a smaller technology company. And they had some pretty serious concerns about his intentions to acquire this new technology company. It was an opportunity-buy, it was a sudden opportunity, you know, just came along and he was deciding to go for it. Not great from my perspective, so I wrote him an email saying that “Hey, this really doesn’t seem to align with your company’s strategy and you didn’t really seem to have done much due diligence on it. It’s very likely that this opportunity-buy will destroy value for you rather than create it, as most mergers do.”
So research shows that over 80% of ALL mergers and acquisitions, all mergers and acquisitions destroy value rather than creating it. You might be surprised by that but that’s what happens. You have to be very careful when you do a merger and acquisition to make sure to do it right. So I wrote my client this email and he took some offense at my criticism of his intention, his judgement, we soon ended our coaching relationship. So I was looking back at this obviously and I kind of, I look at the situation you know, what did I do wrong? What happened? And I saw that I really screwed up. I really should have phrased the email differently. Not being so transparent and direct with my concerns, but really taking my client’s interpretation of my tone, of my email into account, and have written it in a much more thoughtful manner. So I really think that I failed as a coach there because I accidentally inspired a defensive reaction in my client and that was not a good thing that’s never something I want to do, you know, either lose a client relationship or inspire an unnecessary defensive reaction.
So what should I have written? I should have started with expressing my excitement at the possibility of him furthering his own goals and furthering his company goals through making this acquisition. So starting with that side. And then I should have asked him, “hey, tell me, how does this acquisition fit into your broader merger and acquisition strategy? And what kind of due diligence did you do on it to make sure you didn’t end up like that other 80% – like the 80% of acquisitions and mergers that end up destroying value”. I should have asked him if he ever actually worked with this company, or if he can try out low level collaboration to make sure that there’s a culture fit. Because you know it’s really often the case there are two big problems that people don’t consider when doing mergers and acquisitions. They look at the externals, they look at the financials, they look at the technology their company possesses, if it has technology. But what they don’t look at is internal culture of the company and internal businesses, processes, and systems. So two things, internal culture, people, how they interact, and processes and systems. These internals are what most of the time cause destruction of value rather than creation of value. So this is especially likely in this sort of opportunity-buy, destruction of value rather than creation of value because you didn’t do the due diligence, you didn’t really examine it for a long time, you just see an opportunity and you go for it and seize it.
So, stating my worries is what lead to his bad response. Now, why would this new format, as I thought about it later not have led to this response as I realized it? Well first of all because I start the email by expressing excitement for this potential acquisition and saying that “hey, this can – you know, I’m excited about this furthering your goals, your personal goals, your company goals.” It would have placed us on the same side, would have placed us on part of the same tribe, it would have reminded him that my primary primary motivation, always, is to help him accomplish his goals and to help his company accomplish the company’s goals. Then, then I, by using curious questioning, I would have asked, you know, “hey, what is your company’s broader merger and acquisition strategy?” Now, I happen to know for a fact that he didn’t have a broader merger and acquisition strategy. BUT, by using questioning, I would have not rubbed his face into this problem, I would have posed this as something for him to think about, whether he should have a broader merger and acquisition strategy or not. And so that would’ve helped him think about this.
I would’ve also asked him about the due diligence of the both internals, both externals, which you pretty much do, you look at the financials, you look at the technology, you look at their various material wealth, properties, equity and so on. Now, I would’ve also asked him about the internal due diligence. Did he look at the systems and processes? Did he look at the internal culture? You know, perhaps some collaboration to evaluate internal culture and processes and systems would have been helpful. And that would have caused him to think about all of these things, to evaluate them, talk to me and/or others about them and likely, not, simply, not ending the coaching relationship, but have caused him to avoid this acquisition. Now, I know, because of checking up on this later, that the acquisition unfortunately proved pretty much a bust for my client, they were trying to acqui-hire, which is an acquisition hire. They were trying to both get the technology of the other company and just as importantly get the people who created this technology. Unfortunately they had significant culture clashes between the people of that company, between the internal culture and my client’s company, and the large majority of people ended up leaving because it was a bad fit, so they got much much less than they bargained for when they acquired that company, it was a really bad buy.
Now, such examples of bad decisions in everyday life, like the way I screwed up my email are very common. They usually don’t lead to the really really bad result that my email led to, but they sometimes do, of course. More often it’s more like a series of bad decisions and bad interactions that ends up leading to ruin, leading to really serious problems. Maybe I keep sending or somebody keeps sending emails with the wrong tone, with the wrong strategy, ah gosh I just had this happen. I had somebody who kept sending me emails which were really pushy. This person seemed like professional on the face, had a good Linkedin profile, had some good books published, but then he kept sending emails that were really making too many demands on me, weren’t really pushy, just asking asking asking not giving giving giving, and eventually I started ignoring him and disconnected from him on Linkedin, because, you know, I just don’t wanna do that. Why would you work with someone who keeps asking and never giving? So that’s an example of where–what you don’t want to do, you want to think about how the other person interprets your emails.
Now, what about in the office – we talked about emails – what about communication in the office? How often have you seen minor little tensions build up over time and lead to major major office drama? Maybe you’ve participated, you know, that – it can be really serious. That’s communication in the office, not simply by email. What about when somebody skipped working, you or someone else, skipped working on important but not urgent tasks in favor of urgent and not really important tasks? We do that all the time, checking emails, going to work meetings, you know, responding to other people. But not working on important and not urgent tasks, like long-term projects over time, preparing for a presentation that’s six months away, or something like that. We often don’t do that and don’t think about these things. So that’s another problem in everyday decision making. Or let’s say time management, how often have you seen people be consistently consistently late somewhere, or not turning in their projects on time? It’s again, it’s the result of small everyday decisions that result in really big problems down the road. So added together, they really matter. And when we make the wrong choices repeatedly consistently as I did with my premature emails, this is pointing to cognitive bias problems.
Cognitive biases are what researchers in cognitive neuroscience and behavioral economics like myself understand and have found recently to be the cause for a lot of little judgement errors that we make on an everyday level, as well as major major catastrophic errors that we make in major critical decisions. These errors, cognitive biases, mental blindspots, the formal scientific term for them is cognitive biases if you want to look them up on Wikipedia or somewhere else. And there’s going to be a blog linked with the 30 most common cognitive biases, to this episode so you can check them out. They – these cognitive biases are systemic and predictable errors we make as human beings, in business, in relationships, in personal life, in all other areas. And because they’re systemic and predictable, like the systemic and predictable small everyday errors, we can avoid them, we can address them, we can solve them.
So, given that I suffered from these problems and my clients, my coaching and consulting clients, it’s what I do, consulting, coaching, speaking, and training, we both suffered from these problems, and small, everyday level problems. So what I decided to do is create a technique, a hack, a strategy, which you can use very quickly and very effectively to address the large majority of the small everyday decision making problems. And you do that by asking yourself five critical questions, it’s a checklist, of five – five critical questions that you ask yourself before making any sort of small everyday minor decision.
First question, what important information did I not yet fully consider? A common danger is looking only for information – for evidence that fits your perspective. So looking for evidence that fits the perspective that, you know, “I’m writing an email that actually helps my client” as opposed to looking for evidence that “my client might misread my email”. Or, when you’re working on important – when you’re working on urgent tasks, looking for evidence that maybe these are not really important tasks, but you should be working on other tasks that are important but are not nearly as urgent. So look for evidence that disconfirms your perspective, that goes against it, because if you can find – if you can’t find evidence that goes against your perspective, you’re likely to be heading in the right direction.
Another problem with this important information: just what the research shows is that we tend to not generate nearly enough options in our decisions, whether on an everyday level or in major decisions. So what you want to do is generate at least five acceptable options, five acceptable options, that you think, “oh, these are good enough”, before you choose one to go with. You know, for example, if you are writing an important email you want to make five drafts or at least five ways of saying things, and think about which ways are the most effective at various segments of the email. Or if you’re trying to, you know, work – communicate with your colleagues about something minor and annoying that they’re doing, you wanna think about different ways of saying it, so that it doesn’t end up getting into a blame game, getting into a major conflict.
And the other thing you want to do, is you want to look only at information that actually is important. It’s very easy, unfortunately too easy, to keep gathering information for some people who are analytically minded. Not me, I tend to rush to decisions, I’ll – and I tend to, this technique helps me avoid rushing to decisions. But there are some people who are really analytically minded, and who tend to gather lots and lots and lots of information, much, much, much more information than they need. So you wanna look at only important information, so that you don’t get stuck in what’s called analysis paralysis and keeping analyzing information. Ideally you’d want to decide what information is important before you actually go ahead and try to make the decision. So that’s the first question.
The second question: what relevant dangerous judgement errors have I not yet addressed? And I told you that there’s going to be a blog linked with the 30 most common dangerous judgement errors, and it has a link to the assessment that you can take on the 30 most dangerous judgement errors in the workplace. And so you wanna be thinking about these dangerous judgement errors, and which ones seem most applicable to the question at hand.
Third question: What would a trusted and objective advisor suggest I do? Now, if – you probably have a mentor of some sort, you probably have a peer who you trust, in the company or outside the company. Maybe you have someone from outside your workplace who is not a peer in your work, but who is someone whom you trust in your everyday life, you know, a spouse or someone like that, a good friend. Or perhaps you have a consultant, a coach, somebody like that who you can turn to to give you advice on these topics. So that’s one aspect of this question. The other aspect of this question if you don’t have time to consult this person, if it’s a rushed decision, or what you want to do, in this case is imagine what this person will tell you. Now, interestingly enough, when we imagine what this person who we know, imagine this specific person, very clearly, imagine her speaking to you and giving you specific advice, your trusted objective advisor, imagine her telling you, “hey, this is what I think you should do, this is what I think you’re missing,” will get actually most of the benefits of this person themselves. We can’t perfectly model this person of course, but, we can do it most of the way. So over 50% of the benefits will come from you very specifically and concretely imagining what this person would actually tell you.
Now, the fourth question, we’re transitioning with this question from making the decision to implement the decision. The question is: how have I addressed all the ways that this decision can fail? Now, if you choose the best option, but you fall down on the implementation of that option, you know, maybe you decided on the right tone for your email, but you screw up writing the actual email. Maybe you decide to work on important not urgent things, but you keep getting distracted by the next shiny object of the urgent thing despite your intention, despite the choice that you made. There’s so many people who do that. I mean like, when somebody comes into your cubicle and says “hey, can you help me with this?” And, I’ve – I help people who can’t say no to such requests, despite them committing to working on their own important and not urgent projects, and what you need to learn is asking this question. So for example, if you have an office door you wanna keep it closed, in that sense, or pre-commit to saying that, “hey I can’t help with this because I have this really super important and urgent project – I have a super important project that needs to be done”. So something like that, and there are many techniques that you can use. But the critical thing is you want to evaluate all the ways that this can fail, and address them in advance. So, the one thing you might discover while you’re working on this is that the option you pick of the five acceptable options might not be nearly as good as you thought, because they’ll fall down on the implementation. You know, so that’s something you’ll want to be ready to recognize, admit to yourself honestly as opposed to keeping blind – going blindly with this option even – even if you don’t think it will work very well which too many people tend to do, and instead go on to choose one of the other five acceptable options that you generated early on in the process.
So, going on to the last question, the final question, the fifth question: what new information would cause me to revisit this decision? This is a surprisingly powerful question. Why is this? There are too many leaders I know, as again people who tend to be risk-averse and analytical, who are plagued by self-doubt, about decisions – about decisions that they made, you know, who – let’s say send the email, and they immediately think of “oh, you know, this person how can she misread this email and get mad at me” or something like that. So you don’t want to be the kind of person who is plagued by that doubt. And that’s the one problem that this question will help resolve.
The other problem even more common that this question helps resolve is when teams of people are making small everyday decisions. So let’s say you’re in your meeting, discussing a topic and you have some conflict around – because naturally there are conflicts around decision making. But you say, “okay, you know, this is what we’ll do”. Unfortunately what I’ve often seen happen which you’ve probably seen as well, is people who disagreed with the original decision, any time there’s a problem with the choice that was made, they keep bringing it up. They keep hashing over all decisions were made in small everyday matters and saying “oh I told you so, we shouldn’t have done this, this is going to be a problem, we should change our minds.” So you wanna avoid that. And that’s when you – that’s how you avoid it by deciding it in advance what kind of information would make you as an individual or as a team revisit this decision. So you can set a financial trigger for this, for example, “if we don’t reach thirty million in sales for your decision”. Or a survey trigger, such as “if we don’t reach 15% increase in customer satisfaction”. Or a prospect trigger such as, you know, “If we don’t secure thirty new prospects in the next three months”. All of those are ways that you can set a trigger to revisit the decision. And if your trigger is not met, then you just go ahead with the decision. So it will help you a lot down the road that’s why you should use this.
Now, how my clients and I tend to use this decision aid [the Five Questions] is to have it in front of us at all times – have it in front of us at all times. So I made this decision aid into the form of a four-sided folding business card so I keep one on my desk at all times and a lot of my clients do the same thing. So here it is, you see the four – you see the five questions and you see it’s a five-sided – it’s a four-sided business card size. And here I can – inspirational quote on the back “Beware of going with your gut, our intuitions are adapted for the ancient savannah and not to modern business environment and often lead to business disasters.” So that’s another nice reminder. But the crucial thing is these five questions. So keeping these on your desk facing you when you’re typing out your email, looking at your spreadsheets, making your everyday decisions is critical. So that’s what many of my clients do.
Another thing that many of my clients do is hang it in the form of post upon the wall. So, oh, I forgot to say this, what something that my clients do with this is also keep it on – in their wallet.-I have it in my wallet for when I’m away from my computer and I’m making decisions elsewhere, so to remind myself. Another thing you can do with this is hang it on a poster. Print out a poster with these questions and hang it on a wall in your office for all your employees and so on. And you by the way can get this decision aid for all your employees as well. And there’s a link to where you can get the four-sided folding business cards and the poster in the show-notes to the episode.
Now, leaders as I mentioned often get the decision aid for all of their employees not only something for themselves, but for all of their employees, because often their employees are making these small everyday decisions all the time. When you know, everything from sending emails to working with clients and deciding, you know, how to deal with a customer service problem, working with suppliers, so on. They integrate asking these questions into their business systems. It’s a part of their business process, it’s part of their business systems. That way, if you integrate this, you can be confident that all of your employees are minimizing the risk of business disasters in their individual and team decision making processes. You can also hold your employees accountable – you can make sure they’re held accountable for asking these questions. Because if an employee fails to ask one or more of these questions. For example, if they fail to ask “how can this decision have gone wrong?” Then you can make sure that they are appropriately penalized for not following the process. That is a simple process, if they don’t follow the process they can be penalized, it’s under their control.
However if a decision went wrong, that resulted in a serious problem, in a way that wasn’t under their control, that they could not have realistically predicted. You know, sudden tariffs hit and they couldn’t have predicted these tariffs. Or you know, there was a tornado and their supplies got delayed or something like that. They can’t predict these things. Then you should hold the employee blameless even if a problem – a serious problem occurred as a result of their everyday decision making if they couldn’t have predicted them and if they actually did ask the questions.
So having a shared approach to decision making will enable everyone in your company to also be more efficient in their decision making as a team in a team activity. So what a lot of leaders do is make sure to ask all their employees before any meetings, where usually decisions have to be taking place, at least some decisions, they make sure – they ask their employees to think about these decisions in advance and answer these five questions. And then in the meeting themselves they of course have the four-sided business cards in front of all of the employees when they’re holding the meeting. And they use the four-side, the business cards with the five questions to structure the meeting agenda. It’s a natural structure for the meeting agenda. You go through all five questions and then you commit to the decision.
So that’s a very very effective mechanism that makes your meetings much shorter because you know what questions to ask. Knowing what questions to ask is often the most critical and problematic part of making a decision. And knowing these questions and knowing that you’re going to be asking these questions makes things much easier and more efficient down the road.
So, additionally everyone has much more confidence in the decisions that they make because they follow a shared process. It’s transparent, it’s clear, you know how you evaluate information and how you make the decisions. Now, I don’t think that we like to say this, but as I mentioned at the beginning, if you are in a real slam, if it’s a real emergency, you can use these five questions for making major, major, major decisions. So for example, if you’re having a meeting with a business colleague and the business colleague makes a sudden unexpected proposal to you, and says you know, for some reason, for you know, whatever random reason, it’s only available in this period of time when you can trust that that they’re not trying to screw you, that, you know, it really is available for only a short period of time. But you can take less than five minutes to ask these five questions. You know, you’re going to almost almost almost always be in a situation where you can ask the five questions. You shouldn’t ask the five questions if, you know, if you’re about to get hit by a bus. You should just jump out of the way of the bus. BUT, if you are making any sort of business decision, there’s almost never a time when you don’t have the time to ask yourself these five questions. Just ask for a break in the meeting, go out of the room, ask yourself these five questions, analyze them and come back. Easy enough. If you think that the break for asking the five questions would be problematic, ask to go to the restroom. Say you need a bit of time to think about it, whatever, easy enough.
Cool, so, I want you to check out the blog on asking these five questions. I, of course, went over them. I suggest you read the blog, it has a lot of links to a number of principles, basic principles behind why these questions work, the research around these questions, as well as links to other effective decision making techniques that you can use for more important critical decision making processes. And I’ll also link one of these in the show notes in the episode. I’ll also have a link to where you can get the four-sided business cards as well as the poster.
Now, my goal as always is to provide you with outstanding value in avoiding decision disasters and making the best and most profitable decisions. I hope I’ve been successful in this episode, and I want to ask you to share your thoughts on whether I have been successful. Share your thoughts on the episode. Share where and how you might find yourself using these five questions technique. Click “like” if you like this episode. Make sure to subscribe if you haven’t yet, to avoid missing content that will help you defeat cognitive biases and make the wisest decisions. You can learn much more about this in my book on this topic on how you avoid cognitive biases and make the wisest decisions called “Never Go With Your Gut: How Pioneering Leaders Make the Best Decisions and Avoid Business Disasters”. Now, I can also offer you a few resources which will be linked in the show notes: a signup to my Wise Decision Maker Course, which gives you the fundamental basic principles of wise decision making. I hope to see you on the next episode of “The Wise Decision Maker”, and I wish for you to have the wisest decisions, my friends.
Image credit: Disaster Avoidance Experts
Originally Published at Disaster Avoidance Experts on September 28, 2019.