As 2014 comes to a close, take a moment to reflect on all the decisions you’ve made this year. The vast majority of them are small but some are undoubtedly “bigger” and more impactful. For example, maybe you decided to change jobs or buy a new car or perhaps you took on a new assignment at work or decided to invest in a particular stock. Try to isolate one impactful decision in particular. As soon as you have one in mind; ask yourself “was this a smart (good) decision?”
If you answered “yes,” my hunch is that it is a decision that resulted in a favorable outcome… and if you answered “no” it’s because it had a poor outcome. The characterization of a decision as either “good” or “bad” based on the outcome is human nature. However common it is, I contend that it’s not a good measure because it categorizes the decision based on what is possibly a random outcome. In other words, the outcome sometimes has nothing to do with the decision due to circumstances that are out of our control.
I propose we think about decisions and outcomes separately; that is, we make a distinction between the decision process and the decision outcome. Why? Because by making this distinction, it makes us aware that good decisions can sometimes have bad outcomes and conversely, bad decisions can have good outcomes on occasion. In other words, a “smart” process can be guaranteed, but a favorable outcome cannot. When we focus on always using a good decisionprocess (which is something that we can control) we can stack the odds in our favor. The result will be better decision outcomes over time, which is, after all, what we want; to make decisions with favorable outcomes.
In my next blog, I’ll outline the characteristics of a good (aka “smart”) decision process and how we can use it to always (yes, always!) make smart decisions with high probabilities of favorable outcomes.