In Growth & Profit

Last week I made a trip to Minneapolis to watch my beloved Minnesota Twins play baseball at Target Field. I’m always talking about getting away to more games, but most often it’s just talk. Minneapolis is a 3-1/2 hour drive for me and often it becomes my excuse for not making the trip. I decided that Wednesday’s 12:10 PM start was just the thing to allow me to make the trip up and back in one day. So I departed at 7 AM yesterday – off to Minneapolis.

I arrived in the Twin Cities at about 10:30 AM. As is my recent custom, I parked my car at the transit station at the Mall of America and rode the light rail to the stadium. There is something about riding the train to the ballpark that seems to go hand in hand with baseball. It also has something to do with my disdain for trying to find parking near the stadium and the fact that I am directionally challenged – when I get in large cities I don’t know north from south or up from down. The train is a perfect prescription for the anxiety attacks I get when I’m totally lost in downtown Minneapolis.

I arrived at the ballpark at about 11:45 AM and sought to buy a ticket from one of the many scalpers found on the fringes of the stadium. In my only other trip to Target Field, I arrived early and checked out the views from many different seats around the stadium. I realized then that there are no bad views in this superbly designed ballpark. So I decided that on this day, I would sit somewhere entirely different from where I sat for my previous game. I purchased a cheap ticket to sit in the second deck in right field. Although a little far from the action, it gave me a great perspective on the game.

Baseball – once “America’s pastime” – is becoming under appreciated. The highly paid players, the steroid scandals, and the labor strife have surely taken their toll on the game. But there is still something very special about baseball. The game is so simple and yet so complex at the same time. Most people find the home run to be the most exciting play in baseball – but not me. I love the strategic part of the game. Should the manager intentionally walk the slugger with first base open and a runner occupying second and only one out? The risk is putting another potential run scorer on base, but the benefit could come if the next batter hits into an inning ending double play. Then again, should the pitcher who has completed seven innings of scoreless ball be removed from the game in favor of a relief pitcher that has a history of retiring left-handed hitters? The occasions for decision-making are endless and the outcomes never guaranteed. And baseball is renowned for its statistics that are gathered about the smallest of details – e.g., batting average with runners in scoring position with two outs after the seventh inning – and in which many managers place ultimate trust.

It reminded me about all the decisions of importance that business leaders make every day. Studies have shown that most people are much poorer at decision making than they think. Taking the time to understand what decision making really involves, together with some proven and effective tools will help produce better decisions.

Let’s start with a good definition of decision making. Decision making is the process of adequately reducing uncertainty and doubt about alternatives to allow a reasonable choice to be made from among them. It should be noted here that uncertainty is reduced rather than eliminated. Few decisions can be made with absolute certainty because we seldom have complete knowledge about all the alternatives. So almost every decision we make carries a certain amount of risk.

The purpose of a decision matrix is to pass the decision making process through a selection ‘filter’ and reduce the subjectivity that so often ends up clouding our judgment. Along the left hand side of the matrix you see that critical factors are listed. These are the factors determined to have primary influence on our decision. Across the top are the alternative solutions or options.

Decision Matrix

When making decisions it is rare that you would weight each of the factors in your decision equally. For instance, one of your factors may be profitability – and you feel that profitability has more influence in the decision than employee morale. In that case, you will want to assign more of the weighting to profitability. Regardless, the total weighting of all factors must equal 100. We suggest using no more than four to six factors.

Now with your alternatives selected across the top and factors down the far left column and appropriately weighted, you can score each of the options. An option can be assigned a score as low as zero or as great as the weighting for that factor – e.g., Option C was assigned the maximum score of 25 for Vision in the illustration. That is the most that Option C can be assigned for Vision because that is the weight that was assigned to that factor. We strongly suggest that you work across the table first and then down. After you have assigned scores for each factor and option, you total all the scores. The option with the highest score is generally your best course to follow for a decision.

The decision matrix allows a group of people to identify, agree upon, weight and take ownership in a set of factors that are seen by all as influencing a decision.

There’s a saying I’ve heard that I think relates appropriately to good decision making. “What’s popular isn’t always right, and what’s right isn’t always popular.” Being a primary decision maker isn’t always a popular position. However, if your decision making process is sound and you utilize effective tools, you will be comfortable in knowing that you are making good decisions that are free of personal bias.

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