Making a Data-Driven Decision

We make decisions all the time. Most are simple - diet or regular, paper or plastic, beach or mountains. But some decisions are complicated - and not because of the choice - but because of all the things you choose against when you make that choice. And in fact, the more choices we have, the more dissatisfied we are with our final choice. If you've ever had to make a choice whether to use a particular technology, make a purchase, change jobs, move across country or any other complicated decision, you might be paralyzed over what to do. 

For most of my life I've used a deceptively simple technique to make choices where I'm not sure if I'm considering all the ramifications. I can't claim that this is an original process, I probably read it somewhere or adapted it from something I've seen, but it's a lot like chess - easy to describe, and yet handles complicated implementations well. The beauty if the process is that it's driven by data - if you're honest and complete with it. Here's how it works:

  1. Instead of starting with the choices you have, start with what is important to you in the decision, making sure you're as agnostic as you can about the choices available. Using paper (or Excel, in my case, I know, I'm a geek) list those factors from left to right across the top. Be honest; this is the most important part
  2. Next, list the options you have down the column of the left-hand side. It really doesn't matter what order they are, in fact, it's probably best that it's random, or alphabetical, or some other non-deterministic criteria. 
  3. Now apply a "score" beneath each factor, for each option. I normally scale it from 1-3 for a simple, clear answer, and I'll use a 1-10 scale for more complicated "weighting" of the choice within the factor. 
  4. Add the scores across the left, and take the highest score. That's it. It's that simple.

Now you might think, "Yeah, I've done all this mentally already, I don't need to write it down." Wrong. Try it, and unless it's a very simple choice, you might be very surprised to see what you come up with. 

Let's take a concrete example. Most folks face the choice of taking one or more jobs. Let's say you have an opportunity to move to a startup, stay where you are, or move to a new role in your same company. There are lots of decision points for that, but here's a simple spreadsheet you might do:

So why would you "rank" the factors from left to right? Well, the factors aren't always equal. In this example, the young person I was working with told me that salary was the most important thing ever - until we questioned that a lot. Then I found that she really struggled with the job satisfaction part - it was second, but not by much. By using a spreadsheet, you can add a weighting factor to the final tally, which fine-tunes the result so that you're honest with yourself. And that honesty is super-important: If you just game your own spreadsheet you'll always get the answer you flipped a coin for in the first place. You have to lay the factors and their importance out first, and be brutally honest with yourself about that. Self-deception is your enemy here. 

The actual spreadsheet we used in her discussion was of course MUCH larger, and had far more detail. But that's the beauty of this system - you can use it for everything from this job example to buying a new car or house, selecting an database product, moving something to cloud computing, anything. And you'll find, as I do, that it's not necessarily the spreadsheet or the data that is important - it's spending the time to think it through.