"Decision is a sharp knife that cuts clean and straight; indecision, a dull one that hacks and tears and leaves ragged edges behind it." - Gordon Graham
Happy new year and thank you for joining me for blog 1 of 2023, highlighting decision-making and the brain. This is my public exploration of what drives decision-making and how we can use that information to make better decisions, resulting in better outcomes.
I was set a challenge by a follower of the blog who I deeply respect - "Please can you put together a framework that I can refer to when making a big decision". This is my attempt at putting that together. Today's post is about choosing the right decisions to focus on.
Over the coming weeks I will be going through this framework and bringing it to life.
The anatomy of a decision
The roots of bad decisions
One takeaway from last year was it is hard to stay on track. Staying on track means making consistent, thought through decisions that lead in a particular direction.
Examples of going off track are i) trying to follow a long-term investment strategy, but acting on a stock tip because of FOMO or ii) convincing myself that just one chocolate (that quickly become three!) was ok to eat even though I was meant to be on a healthy eating plan. Ideas from random sources or thoughts can veer you off course and lead to bad decisions.
So which decisions to focus on?
Every day we are faced with an overwhelming number of decisions (some research suggested 35,000!). There will always be more decisions we could be a part of too, by helping others or getting involved in the local community.
With an endless number of decisions that we can make, how do we decide which ones to focus on?
The hard thing about hard things
A priority is a decision that is most impactful to us. It exposes us to exciting upside or reduces unwanted downside.
To focus on priorities, we need to overcome the impulses of our shortcutting brain which seems to easily gravitate towards ideas that i) grab attention, ii) are easy to do, iii) are intellectually interesting. Resisting these impulses help us focus on important decisions.
I use the two step model below to help me work out where my attention should be.
Step 1: Decision Razor - what not to focus on
A decision razor is device that can help you quickly cut through a long list to a more manageable one.
1) Is this decision consistent with my (or the firm's) goals?
There are many super-focused companies, but few have achieved the focus that Vanguard has. Focus is a decision. Vanguard's stated mission (slightly simplified) is to 'give investors the greatest chance of investment success'. Their way of fulfilling that promise is by producing ultra-low fee index investments. They have completely changed the investment game.
That clear goal has helped them cross off decisions from their to do list that go away from that clear stated mission. For example they have avoided higher fee or opaque products.
2) Is this decision a distraction. How has it come to my attention?
Advertising is a good example of having your priority list hijacked. Why are you thinking of buying a blender now, when it had never appeared on your list of priorities before? Choosing to spend time on an attention grabbing tasks is a distraction.
3) Am I the right person (is the right company) to be dealing with this decision?
We are often asked to input to situations where we are just not the right person to help. This is doubly negative. Not only will you be inefficient at doing it, it is a distraction for you, and prevents a more suited person from doing it.
4) What if I did nothing on this decision?
What would be the downside consequences (including missed upside) of not looking at this decision? Often decisions feel urgent or important, but when analysed fail to have any material upside or downside consequences. Often these fall into the 'interesting but not important' category.
Step 2: Choosing priorities - what to focus on first
Getting to the top of your to do list, should be valuable real estate. How can you make sure that with your shortened list you can pick the most important ones
1) If I had to do one thing, today or this week/month/year what would it be?
Often we are forced to decide from a list of things but what truly matters might not be on that list. So rather than focusing our minds on yes/no decisions in front of us, we get to ask ourselves what really matters. Asking yourself the one thing you need to do, gets us out of that reactive mindset.
2) Is this a high leverage decision?
Does making this decision have large downstream consequences? For example, spending 30mins on what you should eat today is a low leverage decision, but spending 30mins on your health strategy (run faster -> eat high protein meals & get more sleep) end up taking away a lot of small low leverage decisions.
Lots of technological advances were made by the single high leverage decision of President Kennedy to put humans on the moon. By having that overall goal, everyone knew whether their decisions were consistent with or inconsistent with that goal.
High leverage decisions are decisions that make many other decisions easier. Examples are defining a mission, strategy or tactic.
3) Will this decision matter a lot in a year's time?
There are lots of decisions prioritised on things that on reflection just do not matter in the grand scheme of things. It's tough to choose decisions when things are noisy unless you look from a longer term perspective.
4) Is this a 'hell yeah' decision?
Derek Sivers has an excellent method for choosing decisions, 'If it's not a hell yeah, it's a no', i.e. if it doesn't excite you, don't do it. Whilst we do not all have the luxury of picking on what we focus on all the time, when we do, this is a great way to work on things you are motivated about. You are much more likely to follow through when excitement and motivation are high.
How is this all relevant to decision-making? Here are three take-aways I want to leave you with before we pick it up next week:
1) Our attention is easily drawn to attention-grabbing, easy or intellectually interesting things to work on. These are likely to be distractions not priorities.
2) We can get closer to our true priorities by removing decisions that i) go against your goals, ii) are a distraction, iii) would be better done by someone more suited iv) have no long-term consequences.
3) We help identify our priorities by i) asking ourselves 'what's the one thing I should be working on' ii) making strategic decisions that shape downstream decisions iii) working on decisions that will long-term impact iv) finding decisions that excite us.
Thank you for joining. Next week - 'Why I rarely read newspapers'. Don't forget to sign up to the subscription list.
To read more please read this from my back catalogue.