The Foundations of Choice: Making Decisions from First Principles

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“‎With adulthood comes responsibility.” ―Mary Lydon Simonsen

Nothing defines adulthood more than making decisions.

Yes, you will have made choices as a child, but it is only when you become an adult that the seriousness of decision-making becomes clear. The consequences fall upon our shoulders in a way most of us never settle with. The reason is a simple one. No one ever teaches you how to decide. You’re just expected to work it out for yourself.

There are plenty of examples for you to take notice of.

Your parents. Your grandparents. Your friends. Your colleagues at work. In fact, the list is long and endless.

But there is a problem with this type of learning.

It isn’t complete. Unsurprisingly, there are considerable gaps in what we see and hear. The judgement calls on a good decision falls on the quality of the outcome. It is a fatal flaw in our learning and blights the mind of anyone looking to learn how to make good decisions.

An outcome isn’t a decision.

There are many lessons like this we could get into, but I don’t believe it is the right way forward.

What do I mean?

You can’t take a subject and pick at it. You’ve got to really grasp it and understand it from the ground up. As children, we ask questions all the time. The intent is to keep peeling the layers back until we get to the core. The fundamentals. These are known as first principles.

It is here we begin.

What are ‘First Principles’?

The first principles are the basic fundamental truths of something.

When you strip away the gloss and complexity of everything, you reveal the foundations. These are the building blocks of life. Take a car, for example, not a Tesla, but one running on petrol. How does it work?

Strip away all the complexity, and at its heart, a car uses fire to work.

Yes, it is that simple. Heat, fuel, and oxygen. The three sides of the fire triangle come together to create fire, and it is the fire that powers our cars. A car builds on this basic fundamental. It controls the creation of fire in cylinders to force movement in the cylinder rods. From here, the energy generated turns the wheels that make the car move.

But fire is where it starts. What has that got to do with how you make decisions you ask? After all, just because you drive a car doesn’t mean you need to know how to make one.

Decisions are different though.

You do make decisions every day—therefore you should understand the basic fundamentals of how and why you decide what you do.

What are the fundamentals of a decision?

“A decision is the assessment of information to create the right actions to help us achieve an outcome.”—Darren Matthews

Before I jump into the fundamentals of what forms a decision, I feel it would be helpful to look at a summary statement or definition of the word. Turning to Google, I found this definition: “A decision is a conclusion or resolution reached after consideration.” Admittedly, the vagueness of this definition surprised me. It does support my motivation for writing this guide because we need to know better than this. So, here is my summary statement that explains what a decision is.

“A decision is the assessment of information to create the right actions to help us achieve an outcome.”—Darren Matthews

Yes, there are three fundamentals within a decision.

  • Information
  • Outcome
  • Action

Put them together, and they form three sides of a triangle.

The Decision Triangle from The Resolve Blog
The Decision Triangle

Conversely, take one of them away and just like a normal triangle, the decision falls down.

Each one is prone to great change, either through the way we process them or from the influence of external forces. But, regardless of how they change, these three elements are the foundations of every decision you’ll ever make.

Let’s look at each one in more detail.

Information

Humans are information processing machines.

First, we gather, and then we process. Our eyes, ears, nose, mouth, and hands are tools for gathering information. What we see, hear, smell, taste, and touch signal a wealth of data about our environment. We gather this information with such ease, we take it for granted, but it is the critical first phase of how we process information.

The second phase is, I’m sorry to say, astonishing complex. So much so, that we have spent much of our existence trying to explain how it works.

I am, of course, talking about our minds.

Once we have the information from our senses, we then have to process it. With an estimated 35,000 decisions a day, our minds cannot methodically process one at a time. So, we have developed intuition which seamlessly handles the data we receive. Our intuition comes from the learned experiences of our distant relatives that have been passed down through their genes to ours.

Then, there is the information we haven’t had to deal with before. For this, we have a mind which ponders the information seeking to make sense of it. We describe this as rational thought, and it enables us to solve problems and make decisions we’ve not experienced before.

But there is a problem.

With all that intuitive experience, processing information should be easy. But it’s not. It is hard because we live in a complex world where the only certainty is uncertainty. This force of nature is entropy, and we humans spend most of our lives fighting it.

What it means is that we process information through reasoned thought and intuition. In fact, within your head, a battle rages constantly between these two systems as each grapple to take the lead. Intuition is fast, while rational thought is slow. Thus, each system will look to exploit its strengths when it can.

It certainly makes processing information interesting!

Outcome

At the end of every decision is an outcome.

An outcome is the consequence of the information you assess and the actions that follow. In order to deliver the right actions, it helps if you are aware of the outcome you want to affect. It is a bit like an equation.

Outcome = information + action

I’m wary of this because each of these three elements is unstable and therefore easily changed. Treating any of them as absolute carries significant risk, especially the outcome. The problem is that many of us have high expectations of the outcome, so we tend to focus on it more than we should.

Businesses fall into this trap all the time.

Outcomes become objectives. Forecasts frequently take the desired outcome and paint a picture of the journey. Software exists just for this purpose.

Having the outcome in mind certainly helps, but only because it can help you form the actions you need to take to achieve it.

Actions

With a journey, if the information tells you where you are and the outcome describes your destination, then your actions will explain how you’ll get there.

Actions matter.

In a complex world, we get caught up trying to process information or focusing on the outcome without seeing what we can do. Our actions are critical to achieving a decision. A car journey is incomplete if you don’t travel. A decision without action is no different. It is an incomplete decision and is thus an unmade decision.

The other point about action is this: information and outcomes are theoretical, whereas action is practical.

It is something you do.

Arguably, actions are the least talked about, when they should be the central topic of every choice.

The Foundations of Choice & Why They Matter

“We make our decisions, and then our decisions turn around and make us”—F.W. Boreham

It seems simple to say, but our life is defined by our choices. Every single day, we make thousands of decisions.  All are significant. We might belittle the food we eat, or mock the hours we spend watching TV, or scrolling on social media, but they are all outcomes of our decisions.

You see, these decisions are so intuitive, that we give them no thought at all.

Strip away the TV, the fridge, and our phones and we are left with three components. Information, outcome, and action. Information comes in many different forms, but simply it gives a view of the events up to and including that moment. Outcomes tell us where or what we want to do. An action merely describes how we will take the information and add to it to give the outcome we want.

Decisions of more importance still bring the same logic.

The difference is in the speed of the decision. Different, or more important decisions take time, as we seek to interrogate the information we have. We select outcomes based on rational motives, most of which we try and understand. It is an action which brings it all together.

Grasping these three foundations of choice gives you an advantage.

Most of us don’t take the time to understand how we make decisions. It explains why so many decisions end up being bad. When you have these three foundations in mind, it allows you to decide effectively. The decision triangle remains strong in the hands of those who know its strength comes from the three sides, each one supporting the other.

The best decisions always focus on information, outcome, and action. The worst decisions exclude one of them.

Decide accordingly.

Photo by Bruno Kelzer on Unsplash

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