Quick decision-making can empower you to make rapid choices successfully in your life.
The more I learn about the importance of decision-making in general, the more I can see this is true.
In times past, we had to let our intuition guide our choices without consideration. A hundred fifty years ago, we had to make fast decisions so we could stay alive.
Then, our lives depended on making rapid choices.
Today, we still want to make quick decisions. But the requirements have changed. The problem is we are using old intuitions to deliver very different outcomes.
In this article, we discuss this exact issue—what quick decision-making means today. We will refresh our understanding of why it's good to choose quickly. And, we'll look at some new frameworks to update those old intuitions.
Let's dive in!
- Quick decision-making is an important skill for accessing new information ahead of others.
- One benefit of rapid decision-making is the reduction in stress. Indecisiveness and delayed consideration of what to do invoke feelings of anxiety and regret. Faster choices give less time for these feelings to surface.
- The upsides of fast decision-making are especially evident in businesses and start-ups. The Netflix culture was born and evolved from a concept of time-limited testing and quick feedback.
- The article suggests three frameworks we can use to update our historic-based intuitions. These are reversible decisions, rule-based decisions, and capped downside decisions. These frameworks provide structure and principles to rely on while making decisions.
- Reversible decisions are like two-way doors. They allow us to try something and quickly revert if it doesn't work.
- Rule-based decisions help us build habits that reduce the number of decisions we need to make.
- Capped downside decisions help us assess the worst-case scenario before deciding. this reduces the fear of negative outcomes.
- While fast decision-making has its benefits, there are also downsides. These include the possibility of making wrong decisions that may have irreversible consequences.
Benefits of Quick Decision-Making
Rapid choices bring lots of upsides.
How many minutes do you waste every day thinking about a decision? The answer would horrify you. When you decide quickly, you get more time to turn your decision into action.
New information always follows your actions.
Yes, a decision leads to an action which creates new information. It is one hell of a simple feedback loop. No amount of pondering and scratching your head will give you this.
Action always brings information.
Testing is a similar concept. In simple terms, a test is a feedback loop.
Tests were part of the Netflix culture—and one helped establish their existence.
That Will Never Work
In business, particularly in start-ups, the upsides to quick decision-making are vast.
Netflix was born from a test. Could you order a CD or DVD and receive it in the post? to prove the idea, Marc Randolph and Reed Hastings conducted a test. They bought a CD, put it in an envelope and posted it home. It arrived the next day, undamaged.
It was a test, which also embodies the ethos of a quick decision.
With time-limited testing, feedback arrives quickly. The same values underscore quick decision-making. Rapid feedback gives you new information allowing you to do more of the same or iterate.
At Netflix, this approach typifies the culture and growth the company has experienced.
Fast Decisions in Life
The greatest upside outside of business is the reduction of stress in our lives.
Decision paralysis creates anxiety and regret in equal measure. Both create feelings we struggle to cope with because they live in a space beyond our control. Continued indecision gives rise to more stress, which does little for our health.
Quick decisions take us forward.
They give us new information which instantly removes the worries we had before.
How to Make Quick Decisions
There are several ways to make quick decisions.
Each framework offers a structure we can use to update our intuitions. They give us some principles to lean against, much in the same way we use our senses to warn us of danger.
These frameworks are:
- Reversible decisions
- Rule-based decisions
- Capped downside decision
Let's get into these.
A reversible decision is like a two-way door.
You can walk through it and if you don't like what you find, you can turn round and go back to where you started. It is a painless and simple decision to make. What we fail to realise is just how many of our choices are reversible.
For example, an invitation to go out for an evening is a reversible decision.
You can go out, and if the evening isn't living up to expectations, then you can go home. If it is a great evening then you win.
When you see your choices in this way, you can gain far more than you might lose.
Rules quite purposely limit the decisions we have to make.
You can build habits with rules. They commit you to a daily practice and often have a low barrier to entry.
For example, let's say you want to get fit and you join a gym. Some will set out to complete routines or place goals around weight loss and so on. When these goals aren't achieved, gym membership becomes a wasted investment.
A rule which says you have to go to the gym is far more simplistic. It is far easier to keep—and let's face it, having made the effort to arrive at the gym, you might as well go in.
Rules reduce expectations and remove decisions.
Capped downside decision
A decision where the worst-case scenario occurs means the outcome can't get any worse. Considering and excepting this possible outcome before deciding means you've capped the downside.
You already know the worst that could happen.
If you can do this where the upside is high, then the reward for making a quick decision outweighs the downside.
In business, new projects cost money—and time.
Putting constraints on either or both is capping the downside. At Amazon, the Fire phone was one such project. The downside, in this instance, would be several million dollars and time spent if it didn't sell. The upsides were huge.
AWS (Amazon Web Services) was another project with a capped downside and huge upside. Of course, we know one failed and one succeeded, with AWS creating huge profits for the company.
The Downsides of Quick Decision-Making
You might be thinking there is nothing to lose from making a fast decision.
But there are downsides.
You will make wrong decisions. A choice which may appear to be reversible can often lead to a consequence which isn't.
Let's take the earlier example of going out for the evening.
You decide to go home, and as you walk up the path to your door, you slip. A visit to an accident and emergency unit reveals a broken bone in your ankle. It means your ankle will be in a cast for six weeks.
Of course, no amount of back-peddling can change what's happened.
The more problematic area is information.
A quick decision means acting with the information you have. At the time, it is difficult to judge how complete or important it is. The value of acting quickly often outweighs what you know or don't know.
That is until you've made your choice.
Information you thought was complete turns out to be missing an important piece.
How often do you check the weather forecast before going out? A quick glance shows cloudy skies, so you leave without a coat. A more detailed look shows an evening shower is forecast. It might only last for twenty minutes, but you're out without a coat.
A slower decision might have given you the scope to take a more detailed look.
That's the downside to quick decision-making.
The Role of Emotional Intelligence in Quick Decision-Making
There is a problem you need to know about.
Without EQ, intuition acts for you.
The biggest risk to successfully making quick decisions is not being self-aware. When you act without emotional intelligence, you're letting your historic instincts decide. Your intuition will take charge and push you to decide quickly.
Emotional intelligence gives you awareness.
It is the capability to step outside of your traditional thought process. Awareness brings the capacity to slow down enough to see the decision for what it is.
In high-pressure situations, emotional intelligence makes the difference.
It gives you the presence to slow down. It gives you the mindset to seek a little more information and choose more wisely.
Without it, you're back to the fight, take flight or freeze mindset.
Investing is one situation where your emotional intelligence can make all the difference. On a daily basis, stock prices rise and fall like the tide. When they fall, our intuitive response is often to cut our losses.
In the heat of the moment, our flight response wants to take control.
Meanwhile, emotional intelligence offers a different perspective. It knows stocks rise and fall. It knows yearly trends outweigh daily ones.
The choice to ignore the panic a drop in price creates and play the long game means not making a quick decision. There is no better example of effective decision-making than this.
Our intuition is one of the most amazing things about the human body.
The instinct to be alert to dangerous situations and know what to do is astonishing. Other than communication, no other factor has contributed more to our survival.
Underestimating the upside of quick decision-making is foolish.
Today, making fast decisions allows us to gain new insights we could never grasp by thinking. Our world demands this type of decision-making. The upsides to quick decision-making can make a big difference.
In work and life, there are many examples of the application of quick decision-making.
Like times gone by, rapid choices come with frameworks to help us decide. Learning these—and then applying them is a way to ensure your making the best quality quick decisions.
There are downsides.
Entropy ensures every decision is prone to an unexpected outcome. Uncertainty has no loyalty to the constraints you might apply to your speed of choice.
Of course, none of this happens without an awareness of the choices you make. Emotional intelligence is a vital skill in re-training your intuition.
What this leaves you with is new ways of making quick decisions. These are the frameworks you need in your world today. Less so, the need for fight, flight or freeze.
More the capacity to see the status of outcomes and how you can protect yourself against risk.
So apply these tips today and you'll become a proven quick decision-maker.