How to Make Effective Decisions

This is episode 278 of the Empowered Team Podcast. Welcome to the Empowered Team Podcast where we explore how to optimize your performance in career, sport and life. And now your host, executive coach and life strategist, Kari Schneider.

Welcome. Welcome to the Empowered Team Podcast. I am your host, Karina Kari Schneider, and we are all about self mastery for leaders. And our topic today is how to make effective decisions. You ready? Because guess what? You make thousands, thousands of decisions per day. You probably make about 2,000 per hour and don't even realize that so many of them are happening subconsciously. However, you'll get this decision fatigue when there's so many decisions that you have to think over or that you're afraid you have some self doubt. You might be unsure as to whether or not that decision is going to turn out the way you want to. You're afraid it's not going to be the right one. And that drains us. So we really want to step into how to make an effective decision. And when I say that most of our brains want to go to, well, the right decision. I want the right decision. I really want the right decision. And I'm here to tell you that there is no right decision. It's just a decision. So the first thing, I'm going to define an effective decision. And I can go really deep into this right now because we just spent a month in our coaching mastermind working on decision making, not only how to make effective decisions, but how to implement. And this is something that I end up coaching on so much and consulting on for companies, because there are major decisions and they want other input, the leaders want other input to know that they're making the right decision. So I want to define an effective decision for you first so that you don't go down the rabbit hole of trying to make the right one. Trying to make the right one. Is this the right one? What if it's not right? What if it goes wrong? What if this happens? So we don't want to go down those rabbit holes. We want to make effective decisions by understanding this first, that an effective decision is a choice in which we have made the best decision we can with the time, energy and information that we have. I'm going to say that again. An effective decision is a choice in which we have made the best decision that we can with the time, energy and information that we have. Now, this is not something you're going to just look up in the dictionary. This is something that I defined based on how it's being described. It's an effective decision. Now we want to default to this being the right decision. It doesn't mean it's the right decision. Decisions are neutral. They are not good or bad or right or wrong. A great decision, if you define it as being a great decision, meaning you utilized your time, your energy and your information to its absolute best and the outcome is poor, is it still a good decision? Absolutely. Because it was the best decision made with everything you had. The outcome is not part of that decision. The outcome is one that we tie to the decision all of the time by saying, well, if it was a great outcome, then the decision must have been okay. But it's not how it goes. The decision is the decision is the decision. It is neutral. You do the best you can with a decision. The outcome, we would like the outcome to be tied to a great decision, so it's a great outcome, but it's not always the case. Is it more likely, are there greater probabilities that you're going to have a better outcome because you had a great decision? Yes. The probability of your outcome being a better outcome because you did everything you could with your time, energy, resources, then yes. And information? Absolutely. You're more likely there's a greater probability you're going to have a better decision. However, it doesn't mean you will always have a great outcome. It doesn't. Having the greatest decision does not always mean you'll have a great outcome. It means that you could make an awful decision and still have a good outcome. You can make a great decision and still have a bad outcome. So we're going to go through the three main steps for how to make an effective decision. And we might even go a little bit into implementing it. But we'll start with the three main steps into how to make an effective decision. And it starts with you. Step number one starts with you, you, baby. That's right. Step number one is all about you. And here's what it looks like. Know yourself. Step number one really is called understanding biases. But if I were to sum that up, it's know yourself. Know what you tend to do. Know what you tend to think. Know what you're good at. Know what you're not good at. Know yourself. The top three biases in leadership in decision making are these. The confirmation bias, the overconfidence bias, and the anchoring bias. Now, I'm going to go into these biases much more deeply in the next two weeks. I'm going to do a podcast just on these biases. However, right now, in this moment, the concept is for you to know yourself. Because if you don't understand your own tendencies, you're going to be blind to where you're holding yourself back from an effective decision, from making the best decision possible. In that scenario, you want to make the best decision possible. If you have a whole bunch of black spots around you where you can't see all the information or you are simply unaware that that information exists because there's these black spots all over the place. These black spots are your biases, these black spots are your blind spots. These black spots are the things stopping you from being able to utilize your time effectively, your energy effectively, and be able to get all the information. So we don't want that. So we want to understand ourselves, understand our own biases. For instance, I had to make a decision a year ago. I got very, very sick. And when I got very sick, I ended up going to, I had doctor's diagnoses, the doctor sent me to specialist. Away I went to the specialist and the specialist told me I had to do this and this. I needed potentially surgery, but definitely these really heavy medications. And, and away I went. And I was in a very pressure filled situation, I was very sick. And there I was with an expert, a specialist telling me that I asked. I wanted to heal this naturally, I wanted to. I knew there must be a cause, I knew that these must be symptoms. I, I knew that this needed to be something that I, I could find a way to deal with. And I greatly respected the professional, I greatly respected their information, their knowledge, their experience, and they had dealt with this kind of thing for years. But I said, I don't want a big drug that's going to affect my organs and suppress my immune system and all of these things. And she's like, this is the, this is the way it needs to be treated. If it was this, we could go naturally. If it was this, we could go naturally. But yours isn't that, it's this and you need these meds. And I said no. And it was one of the hardest decisions I've ever made in my life because I was so sick and so scared and had so little support from the medical professionals. And that specialist sent me back to my doctor and said, nope, I'm not going to work with you then if you won't take these meds, if you're not going to do what I tell you to do, then I won't work with you. And I understood that position because I've been in a position as a professional where if someone's not taking my expertise and they're harming themselves, then I don't want to work with them either. So I, I totally got it at the time. However, there was a huge bias that was there for me and it was called a confirmation bias. And I have a belief, and this belief is, is that I know my body. And that confirmation bias had me not willing to try what this person was asking me to do. And it really affected my decision. This confirmation bias of I know my body best, I trust my body and I believe that my body can heal. And I have that confirmation bias because of a lot of experience and because of a lot of expertise in the health realm. But that's my confirmation bias. Now, in this situation, this confirmation bias could have cost me my life because of the decision I was making. This confirmation bias could have cost me time, it could have cost me relationships, it could have cost me because of the decision I was making based on this confirmation bias. However, I have been able to heal. It has been a very, very long road. I'm almost to putting this thing into remission. So the outcome is one that I ultimately wanted. However, had I not had that confirmation bias in my face, I might have been able to take some meds and feel a whole lot better and function a whole lot better and then be able to heal more naturally after I was feeling a bit better, not have it be such a long suffer fest. So I don't know. I really don't know. All I know is the decision I made at the time, and I know now, looking back when hindsight is 20 20, that there was a big confirmation bias there. Now am I confident in my decision that I made? Yes. Am I glad I made that decision? Yes. Was it the best decision at the time for me? I think so. But I wasn't aware, Had I been acknowledging and recognizing my own bias, had I been consulting with some other people who see my bias and that ultimately happened with some other medical professionals, with some friends, with some therapists because they pointed out to me, hey, do you think maybe you should take the meds because you're really, really sick? Why wouldn't you take the meds? And that had me start to see my own bias. It had me start to understand, oh, Book system, is it that I won't take the meds? No, not at all. I will take the meds if I wasn't showing progress. So then I started to understand more about myself and see through that, that blind spot, be able to see and open up that blind spot. Now those other Top biases, overconfidence, anchoring. Anchoring bias means that you are taking the first bit of information as more or more impactful or give it more weight than subsequent bits of information. So I point out these three biases and you will have a podcast that will go into them in more depth in a couple of weeks. But I point them out for one one message. And it is that when you are making decisions bloody well know yourself, look at your weaknesses, know yourself, think and ask. Am I missing something? Ask someone else if you're missing something. But it's awareness of yourself, awareness of your tendencies, awareness of your patterns, awareness of your habits. If you can see those things, that is step number one for making an effective decision. Know yourself. And part of gathering this information is knowing yourself. So that's step number one. Step number two in making an effective decision. This is where we get to gather. This is where we gather and analyze the information. And like I said in the beginning, the effective decision is an effective decision based on the time, the energy, the information. Information is your resources. So gather those resources, gather that information and analyze. Take a look at the information and look at it from a space of being neutral. Look at that information, gather the information, pull it all in. What am I missing? What else could I know? What else could be a great bit of information that would tell me more? Gather it all in. This is why big decision making is fatiguing. Because we use our prefrontal cortex and that is the most exhausting part of our brain to use. It drains our energy. So this is where we end up defaulting to our old patterns. And oftentimes our old patterns don't work for us. We want to actually take the energy to make this decision, especially if it's a really big important decision. If it's a small decision, fine. Keep defaulting to your patterns. Do what you do. It's all good. But if it's a big decision and it's new, and it's going to be very impactful for your future, and you know that it's going to be important outcomes tied to this decision, then by all means, gather as much information as possible and take some time to analyze it. And if you know yourself from step one, know that you don't like to analyze the information and you don't want to take all that time, then get someone else to do it for you. So step two, gathering and analyzing the information, doesn't have to be you figuring out how to do that or you draining your own time and energy to do that. You can have a who, you can have someone else that can do that for you. So then you're looking at more information than you could have possibly gotten for yourself and having them analyze it for you. And then you get to make the final call. You get to look at all of that information. But get a who to do step two. I'm going to say that again because it's so fun. Get a who to do step two. Woo. Woo. Because you don't need to do it all yourself. And gathering information and analyzing it is something that is energy and time draining. So if it's not something you're willing to spend your time and energy on, get someone to do it, pay someone to do it, have part of your team do that for you. So that's number two. And in number two, we often use what would be called a SWOT analysis. Now this SWAT analysis is from. It was popularized in the 1960s by Albert Humphrey during his work at the Stanford Research Institute. And part of this research was to identify why corporate planning failed. And so this is where the SWOT analysis was made. And using this in your information gathering and your analyzing can be a very simple and effective way to go. Okay, what gets kept, what gets thrown out based on these components and they are strengths. That's the s. What advantages does this have? What disadvantages? That's the weaknesses. What areas need improvement? O is opportunities. What are the potential favorable conditions? What are the great opportunities by making this decision or going in this direction? And t is threats. What external factors or challenges could impact this decision, the organization, the outcome? What external factors? These are the circumstances that you can't predict. These are external factors. So what are the threats? What are the things that could happen that you're not, they may not be happening right now, but the potential is there for them to happen. So it's strengths, weaknesses, opportunities and threats. That's the SWOT analysis. And this is simply a tool. This is a tool for you to take a look at all the information and all the analyses. So that's all in step two. And again, that SWOT analysis, get a who, a who can do step two. It's okay, I give you permission to get a who for step two. It doesn't always have to be you. Woo. I'm gonna keep going. I feel like Dr. Seuss right now. So wonderful. All right, step three. This is scenario analysis. So you've, you know yourself, you understand some of your biases. In step two, you're gathering information, you're analyzing the information. In step three. We're going to envision the scenarios. We're going to not only envision more than one outcome, because here's what happens when you are a go getter, you are a leader, you are an achiever, you have a vision for a major outcome that we end up getting very, very attached to, that the outcome is going to look like this, and it has to look like this. And I'm doing everything I can and making every decision I can for this outcome to be inevitable and look like this. I'm going to ask you to do something that might be really, really scary, but I'm going to ask you to do it because this scenario analysis is key for your decision making on the front end. Remember, if you're so attached to the vision, looking a certain way on the back end that you're going to blind yourself to some of the decision making or information on the front end because you only see this one outcome. So I invite you to do some envisioning of more than one outcome. The thing you want to have happen. See it as A, B and C. What does A, B and C look like? It's so important to see multiple outcomes because the likelihood of the outcome being exactly, exactly the way you see it being, I hate to tell you, but statistically is not likely. So we want to see three outcomes. Do you win the gold medal? But it went to a tie and went into overtime? I, I was involved in an outcome like that. Whereas everybody envisioned winning the gold medal. Everybody envisioned the final outcome, but they didn't envision it going to a tie. They didn't envision having to come back from a deficit. They didn't envision having to do it in overtime. So let's look at three different visions, outcomes, three different ones. Look at that scenario analysis in a way that you can see it looking like this, you can see it looking like that. You can see it looking like that. And then you can do what's called a. It's, it's like a decision tree. And you can visualize this decision tree because it's easy. You've got it like a flowchart. It looks just like a flowchart, but your outcomes are on the bottom. Let's say there's three outcomes on the bottom and then it branches up. And when you branch up, you're looking at the external factors that affect all of those outcomes. And when you understand those, those external factors that affect each of those outcomes. If you've got three different outcomes, there's probably three different external factors or three different External factors for each different outcome. And from there you go, okay, now I see three different possible outcomes. Now I see a whole bunch of the external factors that could affect those outcomes. Now I see things more clearly. Now I can understand what's going into this decision and see it far more clearly. I'm not playing a guessing game anymore. Now I can actually attach probabilities with this decision, this decision, this decision, the probability of this decision getting to that outcome, the probability of this decision getting to that outcome, or this third decision getting that outcome. And I can assign probabilities. There's a wonderful book and if you're seeing this on YouTube, you see me showing this book and this book is called Thinking in Bets, Making smarter decisions when you don't have all the facts by Annie Duke. And Annie Duke is a researcher and it is, I have so many, if you look in here, I've got so many dog eared pages because it's so good. I love this book because it helps me help leaders in their companies make effective decisions. Because ultimately you're, you're assigning probabilities. You simply do not know what's going to happen. You pretend you do. If you're in an overconfidence bias, you absolutely think you do, but you don't know. You have no idea what the actual outcome is going to be. You're making an A decision, making your best guess, and that best guess is leaning on probabilities. Your probabilities are going to be more and more accurate if you've gone through envisioning more than one outcome, if you've gone through looking at the external factors for each outcome and if you've gone through then which decision is most likely to lead to which outcome? And assigning probabilities. Because you can see it more clearly, especially when you've done the information gathering and analysis, especially when you can see what your tendencies are, your patterns are, and where your biases might be. So that is step three and ultimately the final question I would ask. Let's say you've gone and you've made this decision. You've come down to the decision you think is the one that's going to be the decision. Would you bet on it? Because that's a question that Annie Duke asks in Thinking in bets. Would you bet on it? What would you bet? How much would you bet? Who would you bet? Would you bet on it? Because that's ultimately what you're saying when you start taking action on that decision is that you're betting on it. You're Betting on yourself, you're betting on your team, you're betting on that decision being the decision that's going to get you towards the direction or the outcome you want to go. So would you bet on it? That's kind of that final layer. Once you've gone through steps one, two and three that you, it's like your truth filter, because if you wouldn't bet on it, you don't have skin in the game, then you probably miss something in one of your blind spots, perhaps maybe a bit of information and maybe you didn't look at all the possible outcomes or at least more than one possible outcome. Would you bet on it? So that betting on it gives you the ability to do a risk assessment, that betting on it has you really start to go, okay, wait a second. If I were to lose, if I were to lose 50% of everything involved in this, if I were to lose a hundred percent of everything involved in this, would I bet on it? If that's what's at stake. So that can come into your risk assessment to identify the risks involved, identify what could go wrong. That's why you're doing the decision tree. That's why you're gathering all the information and that's why you want to know your own blind spots. Because if you don't, you're becoming blind to what the risks are in the decision that you're about to make. Now on the flip side, some of us have so much self doubt built up or we're so afraid of the potential risks that we're paralyzed. We're doing the, the paralysis by analysis. We're paralyzed in that analysis stage. But most of the people listening to this podcast are action takers and really going for that achievement and sometimes can be blind to the risk. You don't want to be blind to the risk, however, you don't want to be paralyzed by it either. So this is why we want to see things from all angles and then understand the very thing I said in the beginning. The fundamentals of it is that it's just a decision, it's neutral. It's not good or bad or right or wrong. It's a decision. The outcome is something completely different. And guess what? I'm going to give you this final bit of information that I think is so important you can change your mind after you've made the decision. What I know, I know sounds crazy, but guess what? When we've made a decision, what happens next is action. And the action starts to give you more information that you didn't have before that, you can then analyze and do the same exact process to go, oh, wait a second, now I see something I couldn't see before, I see a blind spot, spot's been cleared, and I have more information because I took action and I can go and make a new decision. So even if you've made the decision, have solace in knowing that you can pivot, you can adjust, you can change your mind. Because if that outcome that you're going for is important enough, then trust me, you're going to do zigzags to get there if you have to. You're going to go up and down and around in circles to get there if you have to. And the only real problem is if you believe it's going to be a straight line to get there. The chances of you getting there in a straight line are next to none. So that's why we want to just assess our probabilities, see what the likely pattern is, see where we want to go and have as much clarity as possible. So instead of doing a complete 180, we're just doing a little zig and a little zag and a little zig and a little zag. Not going at 90 degree angles, but rather a 10 degrees zig and a 10 degree zag. And we're still going in the right direction. We're still going in the right direction and we're not doing 90 degree cuts because we've gathered the information and we're analyzing it and we're envisioning different scenarios. We're doing our decision trees and we're having other people help us so that we're not blind to our own experience of life, blind to our own biases. All right, next steps are action, Next steps are implementation. And those are things we spend a fair bit of time on in this community. But by going into our triple threat planning, seeing our main goals, seeing our milestones, and then scheduling the actions to get to each of those milestones that lead us to our main goals. So that's what happens after you make a decision, is all of the action. You can do this. I know you. You are an achiever. You are a go getter. You are what we call in our empowered community. The empowered. Who are these people? These empowered people? It's you. You're someone who takes care of yourself, takes care of other people, takes purposeful action, is part of something greater than yourself. That's you. So this decision making is easy. Step one, two, three, know yourself, gather the information and analyze, and then go for it. Envision. Envision what's happening next. Get your flowcharts. Get your outcomes. Get it done. Take the action. You've got this. You've got this. Keep going. You are empowered. I believe in you. You've got this.

Have a great rest of your day.

Listen in in the next couple weeks because I'll have some great information on those biases and more topics for you so that you can feel empowered in everything you do. Talk to you soon.

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