When times are tough, people feel a need to seize any opportunity that they see. Whether it be a job for the unemployed or a sale at the grocery store, scarcity prompts us to act quickly. That’s just human nature.
More often than not, this is a bad choice.
Because of our inability to mentally separate ourselves from our circumstances, we view most situations as more dire than they really are. We generally have a lot more time to think through a decision than we assume.
Most of the challenges we encounter in our lives stem from events or conditions that we’ve never experienced before. If we’d been in the situation before, we’d know how to deal with it, right?
Because these instances are novel, and because we have an internal drive to not miss the boat, we’ll often make a decision without examining all the facts.
This can lead us into further difficulties, if we’re unlucky.
Rather than acting quickly, we need to act intelligently. I’m trying to adopt the following framework for decision making, because I feel like I’ve been too impulsive in the past.
1. Pay attention. Really look at the situation from all angles. For instance, I bought a house a year and a half ago. I convinced myself that it was a good time to buy, but it was really because I had become impatient and didn’t want to sign another year long lease at my then-current residence.
I didn’t spend any time thinking about what I wanted to do with my life, or how the purchase of a home would impact that. I didn’t consider the macroeconomic environment at all, either. Had I really thought through some of these issues, and discussed them with more people, I might have made a different decision.
2. Put all the pieces together. Once you’ve really analyzed your challenge, and the environment in which it’s occurring, then you need to understand what you’ve discovered.
I’m a big proponent of making lists. I think it helps to get the ideas that are swirling around in your mind pinned down on a sheet of paper. Make a list of pros and cons. Talk about your situation with people you respect, and get their feedback. In my case, I could have sat down with my wife and discussed what it really was that we wanted to do with our lives, and if owning a home really fit into that plan. I could have talked to friends of mine who were mortgage brokers and who keep an eye on the economy pretty closely, to determine if this was a good time to buy, or if we should wait.
Make sure you get multiple inputs from a range of sources. Don’t limit yourself to one viewpoint.
3. Act. Once you’ve got all this information pulled together, only then can you make a sound decision. Once you’ve made your decision, act on it.
However, as you’re acting, continue to monitor the situation as was discussed in step 1. Your actions will cause ripple effects, which will generate new data. This data needs to be analyzed in the light of everything else you’ve gathered up until now. If the new data begins to prompt you to rethink you initial decision, don’t be too stubborn to change course.
Impatience is one of my biggest faults. If you’re anything like me, you should probably think about adopting this framework for making decisions, as well. The potential is there for you to miss a chance or two because you weren’t willing to make a snap decision. However, I’m sure you’ll end up much happier with the decisions you do make.
How do you make important choices? Is your framework something like mine, or do you do something different? Let us know in the comments…
Photo courtesy: imjoshdotcom