When I started this blog, I committed myself to producing content that adds value to your life. I hope this one will add value to your life for as long as you use it!
Every single one of us has had to make a difficult decision at one point or another in our life. In business, the wrong decision can lead to product failures, profit loss, or even worse, closing doors. In our personal lives the wrong decision can misdirect our life and leave us with heartache or regret. This doesn’t have to be the case.
Just before finishing high school I had to choose which direction I wanted to take my studies. It was a difficult decision. I opted to further my studies in finance because everyone said it’s where the money was.
It was a bad decision. Yes. I spent almost 4 years of my life studying something that I didn’t have a passion for. While I acquired valuable skills, I lost time that I could have spent focusing on my passion – business growth through intelligent marketing.
We learn from our mistakes…
The last 3 years I’ve managed to consistently make decisions that have led me down the right path – decisions that have handsomely rewarded me both personally and financially. The biggest reason for this is that I’ve learned from my mistakes. I’ve made enough mistakes that, whenever I have to make a big decision now, I carefully consider.
Don’t get me wrong. I still make the occasional blooper. No one is perfect!
About 8 months ago I suddenly got an urge to get in touch with my musical side again. Within 1 week I had purchased an expensive electric guitar and amp. Within 2 months I got bored and it’s now collecting dust. Anyone want a guitar? That’s a typical case of emotion driving a decision, and that my friend is the worst way to go about making a decision, especially decisions that impact you financially.
Calculated, good decisions, have rewarded me nicely. It’s led to a happier me, happier clients, more money and a healthier, less stressful lifestyle. I’ve managed to make such decisions by weighing up the options in front of me. The trick is to not let emotions come in the way of making a choice (guitar, guitar).
This does not mean you should procrastinate on a decision.
Indecision is as bad as the wrong decision!
How do I consistently make better decisions that lead to a happier me and happier clients?
I use a decision making tool, called a matrix. Not the kind that Neo uses. No – a decision making matrix. Yes this is incredibly nerdy, but trust me…it works.
Here’s how it looks:
It’s called a Pugh Matrix.
The Pugh matrix was developed to help with the comparison of a number of design candidates leading ultimately to which best meets a set of criteria. Little did Mr.Pugh know that his methodology for approaching decision making would go far and beyond helping to choose between designs!
This matrix provides a simple approach to taking multiple factors into account when reaching ANY type of decision. This is more than just a weighted average decision matrix. No sir. It actually takes into consideration when you already have a preference towards a choice.
Think about it, whenever you are faced with a list of options to choose from, chances are pretty good you already have a preference towards one. This is where a normal weighted matrix scorecard fails because one would often unknowingly manipulate the end result.
The Pugh Matrix however can be combined with weighted measurement to allow for better discrimination between options as it takes into consideration the unique value of criteria.
EXAMPLE OF A COMPLETED WEIGHTED PUGH MATRIX:
SO HOW DO YOU USE IT?
Below is a breakdown of how you could set up the tool for yourself.
The example I’m going to use is for choosing between holiday destinations.
If you HATE learning how complicated calculations work and simply want to download and use a tool, then no problem. If you scroll down I’m giving away the decision making tool for free
Decide which options/ideas you want to review. Map them out
Define the criteria on which you will review your ideas/options against. You can group them into ‘topics’ if you wish.
Each of your criteria will have different levels of importance to you. Assign a WEIGHT of between 1 – 10 to each of your criteria, with 1 being the least important to you, and 10 being the most important to you.
The FIRST idea will be your baseline idea. This is the one you or someone else likely have a preference towards already. This baseline idea will get the letter “S”. S = same.
Now add your second, third, fourth etc. ideas in the columns to the right of your baseline idea.
Here you will either add a “+”, “-” or “s”.
+ = better
(meaning that you think the particular idea scores BETTER than the baseline idea when measured against the criteria)
- = worse(meaning that you think the particular idea scores WORSE than the baseline idea when measured against the criteria)
s = same
(meaning that you think the particular idea scores the SAME than the baseline idea.
Now count the + and – signs, subtract the sub-totals to get to a TOTAL SCORE. The baseline will always have ZEROs in the total column. Why? Because it’s a baseline silly. Everything else will be measured against it. Anything that comes in below zero is a weaker choice, whereas everything that comes in above the baseline will be considered a better choice.
Count the + and – signs along with multiplying with their weight to get to the total weighted +. Do the same for the negatives. You basically just replace the + or – signs with their weights and add them up. Do not touch the “S”.
When you are done, you will have identified a winner. The winner is the one with the highest number. In the example above, Idea 4 is the winner.
WHAT HAPPENS IF THE RESULT DOESN’T MAKE SENSE?
If you’re not sure about the score and your gut tells you that something isn’t right with the result, the best process to follow is:
Step 1: disregard the loser ideas
Step 2: focus on the baseline and the calculated winner only.
Step 3: add additional criteria and score the baseline and winner again.
Step 4: measure the result.
If at the end you still feel that the winner is not the right choice then you either have given a certain criteria in the list too much weighting or your preference towards the baseline idea is over-powering the factual data staring you in the face.
DOWNLOAD THE DECISION MAKING MATRIX TOOL FOR FREE.
I’ve built out the matrix and have included weighting along with calculations so you don’t have to. Making a decision doesn’t get any easier than this!
WHAT IF A GROUP OF PEOPLE ARE INVOLVED IN MAKING A DECISION – CAN YOU STILL USE THE MATRIX?
Yes you can, but the matrix will need a slight tweaking. Don’t worry, I’ve done it for you. I included a second sheet inside the spreadsheet that calculates it slightly different. It helps with decision making when a small group of people are involved. You know, those typical ‘group decisions’, which without a tool like this would usually end up sitting with the most senior person’s preference. This will help keep things objective!
The only difference with this version is that now each decision maker is given the opportunity to provide a weighting against the criteria. An average will then be calculated.
WHAT CAN THIS TOOL BE USED FOR?
1. Deciding which software to buy
2. Deciding on a holiday destination
3. Choosing a blog/website topic idea.
4. Which car to buy?
5. Shortlisting business ideas for validation
6. New product ideas.
7. Etc – you come up with the rest!
Was this useful to you? If so, let me know how you plan on using it
P.S – Thanks again for taking the time to stop by GrowthNerd. If you like what I put out and would like to be part of my ‘special’ mailing list, then go ahead and sign up to the email list on the right.