Annie Duke asks the question “how do you make decisions? What’s your framework?” (How to Decide: Simple Tools for Making Better Choices)
She remarks that many people don’t have one. Many CEO’s just go off their gut.
I encountered this in my investing days (ahem, internship). I lead a discussion on a paper I had read about how emotions affect our judgment and investment decisions.
I proposed an idea: that the investors should make a spreadsheet with labels on their feelings for that decision. They can use this as further information later on when evaluating their buy/sell/holding decisions.
I was laughed out of the room.
“Hey! Why don’t we all get some mood rings?!” Well, that guy (the boss) was later fired, but that’s not the point.
Point is: if you think you’re making decisions independent of your emotions, you’re incredibly mistaken. Judgment is based off reason and gut. Decisions usually rely on gut though. You have to “feel good”.
I had seen this boss make many decisions without explaining his thinking. “Hold.” Why? The company is tanking per reports. “Sell”, but this one’s looking good!
The point is nobody could replicate his decision making. Half the time it felt arbitrary.
Only later did I learn that one of the most famous investment company, Bridgewater Capital, does this very thing. It’s not for everybody, nor do I do it, but I think it’s a good idea 😄. # proposal
Make a spreadsheet for your decisions.
- What to decide
- Description
- Decision: what you chose
- Rationale: why you chose it
- Facts: supporting facts
- Emotional Reasoning: how you “felt” about it.
Do this for all decisions: even the “hold” decisions (maintain status quo). Because decision to not change course is a decision in and of itself.
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Bryan lives somewhere at the intersection of faith, fatherhood, and futurism and writes about tech, books, Christianity, gratitude, and whatever’s on his mind. If you liked reading, perhaps you’ll also like subscribing: