Two types of Decision Logic and How to Combine Them
…a revolution
James Marsh proposed two types of decision logic. There is the logic based on consequences and appropriateness.
What are these?
Most of us are familiar with the decision of consequences. This is where we break down the decision cost. Next we define the benefit. And lastly we look at probability of those choices.
For example suppose a company wants to do a project and the cost is 10 million. The benefit is 3 million per year. The probability if that it will succeed is 90%. That mean the project will pay for itself in three and a half years. The probability of success tells us that it is very likely to succeed and not run over in cost, schedule and within defined quality.
Consider another example closer to home. Suppose you are the father of a 2 year old child. The child demands your time. She wants to play. The cost of that is your hourly wage. The benefit is that child will bond with you more and love you more. Probability is 100% of being a great father if you take the time to play.
Now consider the appropriateness logic. This is where we ask questions about who we are. What role are we playing right now? What do people in similar roles do in situations like this?
In the project example a company might decide that the project needs to be scraped. Why? The project does not fit their image with their customers. It violates their norms.
They are really saying that as a good corporation they do not do this. Even if similar people and companies would do it, they have drawn a line that the appearance logic dictates that they will not execute this project.
Back to the child example. Suppose the child is throwing a tantrum. You are upset because your work day sucked. Before you take it out on anyone, you stop and remember that your role in this situation is dad. How do similar dad’s act? They comfort the child and re-direct their attention.
When making decisions ask yourself the questions in the summary table below:
BUT how do you combine them? I believe that the 80/20 rule gives us a start.
Most often for work situation, I would put 80% weight on the consequences and 20% on appearance. BUT at home the consequences gets the 20% and appearance gets the 80%.
So it is situation related.
As a leader, I have had to remind people when their decision should be based on consequences. I have had employees who felt that it was their decision to make in situations where they did not have the delegation of authority. It was not appropriate for them to make the level of decision they wanted to make.
It is a tricky balance between these two different types of logic and asking both sets while reminding yourself which one prevails is the key.
My four cents…
Why the picture?
This beautiful mural was created by one of my LinkedIn connections- Blind Fox. She does incredible art pieces and site murals. The picture was for one of her clients, Revolution Axe Throwing company. The picture symbolizes to me the idea of cutting through the fogginess of making a decision. The eagle has an axe which is a pretty blunt instrument. These questions are simple and just cut through the decision making process from two different angles. Simple questions but effective cuts.
