How to make decisions in turbulent times?
You might have noticed that times are very turbulent, especially in Europe as we are nearing the end of 2022. In these times, classic landmark are shifting, new values are being pushed to use and we are expected if not forced to accept them. As new landmark and history are unfolding right in front of us, we are NOT prepared for such global change especially if we do not know for sure what is coming. I am not talking about being positive or not, I am talking about personal and business decisions like: "Should we expand in Spain? or in the US" "Are we going to be able to continue suppling customers on time? at a competitive price..." "Should I sell my businesses, my properties? " "Should I go online?" "Should we move to a better country?"... These are decisions that are important, shape your life and the life of people around you. We are used to make decisions with the old model of reality. So, for example in the old model of reality, you could still open a sandwich bar in a busy area and make it profitable. Nowadays, there are new parameters: lock down, staff shortage, supply chain issue and rising prices amongst others. So HOW do you make a decision?
Not making a decsion Is a decision
First let's mention that NOT making a decision is making a decision. Understanding and being fully aware of this, allow you to feel much better and to prepare you better for what is next.
If you decide NOT to make a decision: WRITE IT DOWN in you personal notebook and in your Personal Finance Notebook.
WHY? so that you review that decision at least once a month.
If you want, you can improve this process by writing down the reason you took that non decision.
Turbulent Time DEcision Tool: simple yet effective
I have recently developed a simple yet powerful tool to help me make some hard business decisions: the Turbulent Times Decision Tool.
Basically I very quickly analyse the outcome of making the decision or not, using these questions:
If I decide (or not decide) to make this decision:
- 2: Can overall things be much worse than before? Are the benefits worth the risk?
- 1: Can overall things be a bit worse than before? Are the benefits worth the risk?
0: Can overall things remain roughly the same? Are the benefits worth the risk?
+ 1: Can it improve (my life, my cashflow, my love life...) a bit? Are the benefits worth the risk?
+ 2: Can it improve (my life, my cashflow, my love life...) a lot? Are the benefits worth the risk?
It does looks like an oversimplified decision tool, and it actually is, even though, in the backend (your brain) it works by using YOUR recent information, feelings and knowledge of what is currently going on. It also work with your RAS : Reticular Activity System that let you filter information and allow you to make decisions with what you know, have and feel.
That is one of the primary reason why it is VERY important you control your mind intake.
Your mind intake (the news, your social environment, your peers, the books your read...) will shape how you think, how you are and what you do)
Conclusions
Whether for business, personal relationship or other area of your life, not making a decision can sometimes drain your energy, for weeks, months or years.
The least you can do, is to clearly identify the issue, and DECIDE not to Make a Decision.
If you want help in making a decision itself, use this model. Start with small decisions for fun and testing purposes.
- 2: Can overall things be much worse than before? Are the benefits worth the risk?
- 1: Can overall things be a bit worse than before? Are the benefits worth the risk?
0: Can overall things remain roughly the same? Are the benefits worth the risk?
+ 1: Can it improve (my life, my cashflow, my love life...) a bit? Are the benefits worth the risk?
+ 2: Can it improve (my life, my cashflow, my love life...) a lot? Are the benefits worth the risk?
Inspired by Anne Frank
Homework
Take ONE (even small) decision that you have to make and go through this process. Share here the steps that you are taking, so you can show and help others in return.
Remember always start with small step, especially with difficult activities.
