"When we encounter chaos, we seek ways to structure it, to see through it, or at least to gain an overview of it."
Decision making can be difficult. How do you know you’ve thought through the situation sufficiently? How do you know that you’ve looked at the situation from the best perspective to get the best result? All of this chaos is managed through the use of decision models, which allow decision makers to structure, see through, or gain an overview of the situation to be evaluated.
The Decision Book contains 50 models for decision making and strategic thinking. These models are categorized in such a way as to help you quickly find the set of models pertinent to what you are considering, such as:
- How to Improve Yourself
- How to Understand Yourself Better
- How to Understand Others Better
- How to Improve Others
Within each of these categories you will find several models, each presented with a description and diagram to give you, as a decision maker, information regarding what situation the model is intended for and how to use it.
The Big Idea
Models are just as valuable for self-understanding as for understanding others
"The 50 best decision-making models—well known and not so well known—that will help you tackle these questions are described in words and diagrams"
The subtitle of the book is “50 Models for Strategic Thinking,” which is the first clue that these models are valid not only for making decisions about others but also valid for making decisions about ourselves. Strategic thinking applies equally to both.
So, what makes a decision model more applicable to oneself? The model, fundamentally, is more internally reflexive, asking for focus on the decision makers themselves. Looking at the book, the self-reflexive models are subdivided into Self Improvement and Self Understanding. Improvement models are for understanding where to take action, where Understanding models are about better comprehension.
The Self Improvement section includes models like “The Eisenhower Matrix” (how to work more efficiently) and “The John Whitmore Model” (am I pursuing the right goal?). These are models most appropriately used when making decisions about self-improvement. This section also contains models which, while most applicable to self-improvement, are also applicable to understanding others: “SWOT Analysis” (Strength, Weakness, Opportunity, and Threat analysis). SWOT Analysis, fundamentally about where to build up and where to protect, can be applied to individuals, groups, or organizations of any size.
The Self Understanding section includes models like: The Flow Model (what makes you happy) and The Personal Performance Model (How to recognize if you should change your job). These models help you better know yourself though they do not, in and of themselves, suggest any specific action be taken. This section also includes The Hype Cycle (how to identify the next big thing). Identifying the next big thing is not so much about self-understanding as it is about knowledge about the outside world you may find useful—a skill developing model.
The next part of the book is about understanding and improving others. Again the understanding section is about knowledge without specific calls to action. The improving section speaks to effective leadership and helping others be better.
The Understanding Others section includes models like: The Pareto Model (why 80 percent of the output is created with 20 percent of the input) and The Long-tail Model (how the internet is transforming the economy). In the former model, the discussion lies around how 20 percent of people seem to get 80 percent of the work done. In the latter model, the discussion is around the counter-intuitive idea that given open access to all consumers, almost all products can find a niche market much larger than brick and mortar markets—people shop differently when given the right opportunities.
The Improving Others section includes models like: The Team Model (Is your team up to the task?) and The Role-Playing Model (How to change viewpoints). The former model is fairly self-explanatory: it is about evaluating a team’s ability to successfully execute a planned task. The latter model describes how you and others can be lead to explore a topic from multiple points of view, resulting in a more holistic understanding.
Contradictory models are often are complementary
"The Pareto Principal—the idea that 20% of products rate 80% of turnover—may not always be right… Chris Anderson claimed that everything being offered for sale on the internet was being purchased."
The above quote contrasts the Pareto and the Long-tail Models. On the surface, it would appear that these two models are contradictory. One says (among other things) that only 20% of products should be considered successful. The other model suggests that almost all products will find a successful niche.
Which model is correct? Both are, actually. 20% of products represent 80% of successful products through traditional sales channels, but with niche marketing via the internet, almost all products can be successfully marketed because of the reach available.
It is important to understand what the models are telling you and understand the implications of examining more than one model at a time.
The future of decision making will rely on prognostication tools
"In the future, decision-makers will work with prognosis tools rather than with models. There is a problem…"
There’s a plethora of available data and more and more need for quick decisions in our business and personal lives. Taking time to pick one or more models and running all the data through them to get to arrive at an answer is incredibly time consuming.
The authors suggest that software based prognostication tools are the answer to get needed information in a timely manner. Prognostication tools, by their very nature, are constantly consuming the latest relevant data, running it though the model continuously, always providing the best predicted answer, based on the most current available information. Gathering and crunching data is no longer the decision makers. Querying the tool for the latest best approximation of the answer is readily available.
The Decision Book is best thought of as a handbook for decision makers. Whatever situation you face, you can find at least one appropriate model in this book that will allow you to effectively evaluate your situation and come to the best possible solution. But the call it just a handbook would be doing the book an injustice. The book is more than that. It is an invocation to think of models as tools. Where there is no best fit for a given situation, think about what a model would need to do to address it. Record and refine that model. As it becomes stable, consider sharing it with others. Help others solve their own problems with your model.