A SMART way to choose a car, or anything else

businesswoman receiving keys of her new off-road carMy daughter needed a car to drive to college. It needed to be safe, cool, and inexpensive, among other things. Too bad there’s no really cool, really inexpensive car out there, so, once again, we needed to make trade-offs. We started by listing the major goals and considerations. This turned out, as usual, to be a mix of objective and subjective factors. We then identified some cars that seemed to be good choices. We filled in a matrix evaluating each car against each factor. It looked something like this (using made-up cars for the example).car choices

This alone is a useful exercise and often gets you to an answer. You’ve made sure you’ve considered all the important factors. Sometimes a clear winner pops out, but not this time. Each of the choices tops in at least one consideration. How can you compare these? Some of the factors are very specific and others are subjective. They involve big numbers, small numbers, or words. Sometimes more is better and other times less is better. To make things even more confusing, the factors are clearly not all equally important.

I used my all-time favorite tool for making choices. I’d been using it for years before I found out it had a cutesy acronym, SMART, for Simple Multi-Attribute Rating Technique. The first step is to make everything numbers. For example, yes is 1 and no is 0. Appearance is on a scale from yuck to cool, with yuck being 1 and cool being 5. Here’s what I got. car choices numerical

A simple weighted average (see earlier post) won’t work here because the numbers are so varied, but SMART is designed for problems like this. You can do the calculations manually—they’re simple but tedious—or you can use this spreadsheet, choose-a-car. You can change the factors and alternatives for whatever decision you’re considering. If you have fewer of either, just delete the extra rows or columns. Here’s how to do it.

Step 1. For each factor, enter the worst that you would consider and the best that you would reasonably expect. For example, I can’t get a new car for less than $9000, so that’s the best price. I’m not about to spend more than $20,000 for a car for this kid, so that’s the worst price. The consumer rating is on a scale of 1 to 10, and I don’t have enough faith in it to throw out a choice based on it, so the best is 10 and the worst is 1. Here’s what I got. car choices worst best

Notice that the worst and best are chosen without looking at the values for the choices at all. This helps you put the differences in perspective. Here, the consumer ratings are practically the same. Even the prices are very similar. Putting this all in the context of best and worst keeps me from worrying about minor differences.

Step 2. Next, for each factor, rate its importance using any scale you wish. Here’s where SMART really shines. Most decision techniques ask you to rate importance without reference to anything—what’s more important, price or appearance? It’s a meaningless question. How much price? How much appearance? SMART anchors it to something. The key is to compare the value to you of moving from worst to best. For example, ask, “Would you rather have the price go from $20,000 to $9000 or have the warranty go from 3 years to 6 years?” I rate the importance of the warranty only 10 and rate price 50, since I would much rather save the money. I give each of the other factors a preference rating similarly. It doesn’t matter what numbers you use, just so the ratios represent your preferences. For example, price is five times as important than warranty. Here’s what I got. car choices pref

Step 3. Finally, we’re ready to do the calculations. The easiest thing is to use the spreadsheet. Here’s what I got. car choices final

The scores for each choice are at the bottom. The Kumquat comes out on top with a score of 0.649, or 64.9% of perfect. If you didn’t get the winner you expected, check your preferences. If you change them, the answer could change. By the way, I had my daughter put in her own preferences, which included a lot for appearance and absolutely nothing for price, and got the same answer. Whew!

Where did these scores come from? What you see listed under each choice are the normalized scores. This tells you where the option lies between worst and best. For example, the prices are all about in the middle, the consumer ratings are all really good, and the appearance ratings are all over the map. This helps you see which of these factors is a big deal. If you’re interested, the formula to do this is (score – worst)/(best – worst). The score is the sum of these values normalized by preference. By the way, if you want to do this manually, or are just interested in the underlying formulas, here’s how it works. Get the weightings by dividing each preference score by the sum of the preference scores. This gives you weightings that add to 1. Then to get the final score for a choice, multiply each factor score in the column by the corresponding weighting and add them all up.

I’d be interested in hearing from you if you use this great technique to make a complex choice of your own. Any questions? I’d love to hear from you.

Imagine that! And that and that and…there’s your answer

viz alts

What on earth does imagination have to do with decision-making? Yes, it helps you come up with more alternatives, goals and constraints. But then, it’s just a matter of evaluating each of your alternatives against your goals and making a reasoned choice, right?

Actually, this is the one step in the decision process in which imagination is most needed. Evaluation of alternatives is tricky, since it’s all about what happens in the future. What will the new job be like? How will I like the new house? How will the customer respond to the ad? What will the competition do? Have you ever made a choice and later thought, “Well, this isn’t at all what I expected”? I know I have. Some of this is unavoidable, of course, but visualizing the future and playing it against your goals and constraints helps to guide you to a happy choice.

Let’s say you’re planning a vacation, deciding where to go. You’re considering Maui and Paris. You’re interested in adventure and scenery, but want to minimize cost and hassle. To help you think about it all, lay out a grid with your options across the top, including staying home. (Remember that doing nothing is always an option). Run your goals and constraints down the side.

Now take each alternative in turn. Imagine that the alternative has been selected and carried out. What are you doing? How well is it working? What have you given up? What have you gained? What have your stakeholders gained or lost? Describe vividly and as precisely as possible. Are there further (unintended) consequences? Note anything you’re unsure about.

Start with Maui. How do you get there? How long does it take? How much does it cost? How much vacation do you take and how is your job covered while you’re gone? What do you eat and where? What do you do for entertainment? Imagine snorkeling in clear waters. See the scenery in your mind. Imagine the luau with the hula show. Feel it. How do you enjoy it? How does your traveling companion enjoy it? What’s fun? What’s a hassle? Now make notes in the Maui column for each of your goals and constraints. Was there anything significant that you imagined that should have been a goal or constraint? Consider adding it to your list.

Now do the same with Paris. Finally, imagine staying home. What do you do with the money you save? What do you do with your time at home? Is it a vacation or do you finish some projects?

See the sample table above. The question marks highlight where you need to learn more. You need to find out more about costs for both trips (hotels, airfare, local transportation). Fill in those holes, then compare across the rows. Maui seems to win in the last two rows. If we’d listed art and cuisine as goals, Paris would have won, but we didn’t. It’s all about matching the solution to the key goals. Staying home wins for the two constraints. Now balance. Is the adventure and scenery worth the cost and hassle? Yes? Maui it is.

You may get an answer using these simple text assessments, or you may want or need to dig deeper. In future posts, I’ll give some techniques for making a choice when you have multiple, conflicting goals.

Do you have any techniques for making choices when you have multiple goals?

Go for the goal! No, it’s too big!

Open air paintingGoals are often so lofty that they overwhelm us. The choices seem to be all-out pursuit or nothing. Often we take the “nothing” option rather than face the enormity of the task. Here are some ideas for a broader list of alternatives.  As I’ve said before, you always have more than two options. Try these.

Go for it completely
Go for a more accessible version of it
Go for an intermediate goal
Go for a different goal with similar satisfaction
Do a trial run without committing
Do nothing

Let’s look at these more closely. As an example, imagine you have a good job, but you always wanted to be an artist. What can you do about that goal?

—Go for it completely

One obvious choice is to pursue the goal fully, setting aside everything else. 

  • —  Quit your job, rent a studio and devote your life to your art

—Go for a more accessible version of it

Is there a scaled-down version of your goal that gives almost the same amount of satisfaction without the sacrifice? Yes, I know this goes against all the motivational speakers and writers who tell you to shoot for the moon. But do you really want to give up many of the other important aspects of your life to work toward something you may never reach? In our example, rather than working toward becoming an internationally acclaimed artist for the ages, it might be almost as good to get a local following.

  • —  Keep your job and devote your weekends to your art
  • —  Get to know the local galleries

—Go for an intermediate goal

Your first action in achieving the goal may be to reach a key step along the way. Think about what you will need to do to reach your goal. Any of these may be satisfying goals in their own right. In our example, to become a great artist you will need to hone your technique, produce art and get it seen.

  • —  Take art classes in the evenings or on weekends
  • —  Seek out places to get your work seen by the public
  • —  Devote your weekends to producing art

—Go for a different goal with similar satisfaction

Think about what it is that you find attractive about your goal. Can you get that same satisfaction some other way without disrupting your life? In our example, you may be able to steer your current job in a direction that better uses your artistic capabilities.

  • —  Seek a transfer into the graphics department of your current company

Do a trial run without committing

Rather than jumping into the goal with both feet, you may want to put your toe in the water first. Go after the goal, but make sure you can get back to where you were, if it does not turn out as you would like.

  • —  Take a six-month leave of absence from work to pursue your art

—Do nothing

No matter what all those motivational speakers will tell you, this should always be on your list of alternatives. You have a choice. You may have moved on since you set that goal. In our example, perhaps you now have a family and find spending time with them more enjoyable and rewarding than creating art. It’s OK to choose a new goal over an old goal. People will accuse you of letting your dreams pass you by. Let them. You know you’ve made a deliberate choice by comparing the costs and rewards of going for the goal. Free yourself from old or unreasonable goals.

Opportunity knocks. What do you do?

Sign this contractPeople faced with an opportunity usually figure they have simply a decision of yes or no, take it or don’t. The challenge here is to come up with a richer list of alternatives, built around the opportunity and variations of it. As with all decisions, there may be even better options out there if you open your mind to them. Before you try to choose, give yourself a rich list of choices. Here are some ideas to get you started when you have an opportunity.

—Run with it

Taking the opportunity exactly as offered is clearly always an option. Here’s an example. You’re an independent consultant and you enjoy the flexibility and the chance to work in a variety of industries. Susan has just offered you a full-time, permanent job with a financial institution. You have one clear alternative:

  • —  Accept the job offer as is.

—Use part of it

Are there pieces of the opportunity that are attractive, without committing to the whole thing? Perhaps you see a little nugget in the larger opportunity. Perhaps there are parts of the opportunity that you’d prefer not to pursue.

In our example, maybe you’d like to pursue the job, but maintain your independent status and the chance to work in other areas.

  • —  Accept a part-time, temporary or on-call position

—Negotiate a variation

Is the opportunity all you want? If anything is lacking, can it be added? See if the opportunity can be enhanced to meet all your needs.

In our example, you may seek more money to compensate for giving up your consulting practice, or you may wish to maintain the amount of vacation you have been giving yourself.

  • —  Accept the job if Susan meets your salary demands.
  • —  Accept the job if Susan gives you five weeks a year of vacation.

—Pass it on

If you decide that you have no interest in pursuing the opportunity, would it be of interest to someone else? Someone else might find it the perfect opportunity and you would be doing her a favor to tell her about it.

  • —  Tell one of your colleagues about the job opening

—Do something related

Does this opportunity suggest other opportunities that might be even better? If this opportunity comes from a surprising direction or an unexpected area, what else is out there? You may want to do some exploring before you commit. In our example, you may never have considered financial work.

  • —  Seek out consulting in the financial field

Do something with a similar payoff

What is it that you find attractive about the opportunity? Are there other ways you can get it? Think about each attractive aspect in turn.

In the example, you may not have considered full-time work before. It’s attractive because of the steady paycheck and administrative and marketing support.

  • —  Investigate other full-time, permanent positions

— Use it as a springboard to other opportunities

Even if you don’t take the opportunity, it may lead to further opportunities. In our example, Susan has contacts who may be interested in hiring a consultant. She clearly respects your work and so could put in a good word for you.

  • —  Thank Susan and ask her to let you know if she hears about any consulting opportunities

— Do nothing

Ignoring the opportunity is always an option. Make it a conscious choice. There’s a huge difference between failing to seize an opportunity and actively choosing to let it go. The first case indicates laziness, cowardice or obliviousness. The second shows that you’ve taken charge of the decision and determined that the drawbacks outweigh the benefits. In the first case you may feel regret or helplessness or that the world is passing you by. In the second you feel empowered.

There is an important reason to include the do-nothing option as an alternative in any decision. Every choice has drawbacks and that often makes people afraid to make a choice. Considering doing nothing as a choice forces you to examine the drawbacks of the current status and pushes you toward action.

  • —  Turn down the job offer

What else?

What other options can you think of for taking advantage of an opportunity?

Choices for Change

Woman Riding Bicycle in BerlinYou always have more than two choices in any decision. A lot of decisions come out of a problem or dissatisfaction. The temptation is to jump in and do something right now, especially if you’re angry. Before you do that, settle down and make a list of possible alternatives that will remove, mitigate, or otherwise deal with the problem. Remember that the idea is to generate as many alternatives as you can. Some will be clearly ludicrous or even unsavory. Don’t worry about that now. You’ll get to throw those out later. Right now, open your mind to the full range of possibilities.

Here are some general possible alternatives.

  • Hope for someone else to change (Good luck with that!)
  • Help someone else to change
  • Remove the problem
  • Remove the source
  • Remove yourself
  • Change the problem
  • Change the way you deal with it
  • Accept it

— Hope for someone else to change

This is usually the first alternative people think of when they’re dissatisfied. “The problem is my boss.” If not your boss, it could be your spouse, your coworker, or some seemingly incompetent service worker. Even though this is the most obvious solution, it’s generally the least likely to succeed. Often people get stuck taking this as the only solution. Then the only action they can take is becoming increasingly annoyed with the other person. The result of your decision process must always be what you are going to do.

Here’s an example. My coworker Bob rides his bike to work and keeps it in the hallway outside his cubicle, making it hard for me to get to my own cubicle. One alternative would be silent resentment toward Bob for causing me inconvenience.

Help someone else to change

Come up with alternatives on how you can get the other person to change their behavior. This could be simply talking to them. Better yet, think of alternatives that you can undertake to remove barriers that they face. Remember that people are not going to change just because you want them to. You may need to offer to do something for the person in exchange. Here are some other alternatives for our example.

  • —  Ask Bob to keep his bike out of the hallway.
  • —  Help Bob find a better place to keep his bike.

—Remove the problem

Focus first on the problem, not the people. Once the problem is well framed, think about how it could be removed. Ideally the problem can be solved to the satisfaction or all.

In our example, the problem is the bike in the hallway. Here are some possible alternatives (clearly, some better than others, but right now we want a rich list).

  • —  Throw the bike out the window.
  • —  Get management to institute a rule against storing bikes in the building.
  • —  Put the bike in Bob’s cubicle.
  • —  Find someplace else to store the bike.

—Remove the source

Think about what is causing the problem, then how it could be mitigated. Do a causal analysis. That is just a fancy way of suggesting that you look for the causes of the causes. In our example, Bob has caused the bike to be in the hallway, so he is the source of the problem. But if we dig deeper, we find that Bob stores the bike in the hallway because there is no other safe place to keep it. Also, the problem arises simply because Bob rides a bike to work. Perhaps he has no car or he wants the exercise. Here are some more alternatives:

  • —  Get Bob fired.
  • —  Have the company install secure bike storage.
  • —  Buy Bob a car.
  • —  Buy Bob a gym membership.

—Remove yourself

It’s sometimes more effective to avoid the problem than to fix it. Leave a bad relationship. Check out early from a dirty hotel. Quit a dead-end job. Avoid a business that gives your poor service. Often this is hard to do, especially if you’ve put a lot of yourself into trying to fix the problem. We don’t like to be quitters. That’s why it’s especially important to add this option to your list of alternatives. Empower yourself to walk away if it makes sense. Here are some more alternatives for our example:

  • —  Quit your job.
  • —  Work exclusively from home.
  • —  Ask to be moved to a cubicle in a different location.

— Change the problem

Try to think of ways that the problem can be less of a hindrance. Suppose you can’t solve or remove the problem and you’re unwilling to leave. Can the problem somehow be contained or reined in?

In our example, if we accept that Bob will always be leaving his bike in the hallway, is there anything we can do to make it less of a hindrance to those walking by? Here’s a possibility:

  • — Find a way to mount the bike to the side of the cubicle or otherwise get it out of the flow of traffic.

— Change the way you deal with it

Again, suppose you won’t be able to remove yourself or the problem. Can you change your own behavior to keep it from bothering you so much?

Accept that Bob will always leave his bike in the hallway next to your office. Is there a way that you could avoid it or make it easier for you to get by it?

  • —  Find a way to approach your cubicle from the other direction, avoiding the bike.

— Accept it

This should always be on your list of alternatives. It’s remarkably liberating. Accept that people won’t change their behavior and the problem will persist in its current form. Choose to live with it.

—Accept the fact that Bob will always leave his bike in the hallway and you will need to squeeze past it to get to your cubicle.

Two of these alternatives, the first and last, are superficially the same. You can wait for someone to change or you can accept the situation. In either case you do nothing at all about the problem. But there is a world of difference in how it makes you feel and how effective a decision-maker you can be. In one case, you waste a lot of energy on something that may not change, resenting the person causing the problem and building stress. On the other, you have the peace of knowing that you made a conscious choice for acceptance and can focus your energies elsewhere. On one hand, you are at the mercy of someone else’s choices. On the other, you have taken charge by making your choice after considering all of your other options.

When you put together your list of alternatives, you’ll be tempted to drop some of them immediately. Many of the alternatives in the example are intentionally ludicrous. Buying Bob a car or destroying the bike is clearly overkill. For now, resist this temptation to throw out options. You want to keep yourself in a mode of divergent thinking. Evaluating the options is convergent thinking, which inhibits the open-mindedness you need right now. A good list will include one or two preposterous ideas. You’ll get to evaluate your options later.

Some of these options appear ridiculous when looked at dispassionately in an exercise. For example, it would be stupid to wait passively for Bob to move his bike and build up a level of resentment and anger to the point that you throw the bike out the window. Yet people do things like this all the time. You can probably think of several examples in which a petty problem led to rage and destructive behavior far out of proportion to the original annoyance. Take charge of your decisions before the rage builds.

You always have more than two options

two choicesMany of the decisions you face ostensibly have only two choices–often simply yes or no. That makes it easier to consider, but greatly limits your decision-making power. One technique people use to control other people is to offer them limited choices. I used to do this with my daughter when she was young. I’d give her two choices, and either one would get her to do what I wanted. This worked for a few months and then she figured it out. Some adults never figure it out. You may have other choices beyond the ones presented to you.

If you have a yes-or-no decision you’re already considering a change or action. Are there other possibilities that may be even better choices? Of the seven steps of decision-making, the step of choosing alternatives  does the most to lead you to some really good solutions.

There are always more than two choices. There are choices beyond the first ones you think of. There are choices beyond the ones presented to you. Often these less-obvious alternatives turn out to be the best. Use divergent thinking to search for them. When you put together your list of alternatives, you’ll be tempted to drop some of them immediately. If you’re really using divergent thinking, your list will include some items that are impractical, even ludicrous. Resist this temptation to throw them out for now. You want to keep yourself in a mode of divergent thinking. Evaluating the options is convergent thinking, which inhibits the open-mindedness you need right now. A good list will include one or two preposterous ideas. You’ll get to evaluate your options later.

Often the very statement of the question limits your options. Here are some typical examples

  • “We just had a baby and our house is now too small. Should we add on to the back or add a second story?” (Another option might be to buy a different, larger house.)
  • “I don’t want to move, but the company I work for is shutting down our local branch. Which of their branches in other cities should I transfer to? My family lives here and I want to be able to visit them easily.” (Another option: Get a job at another company in the area.)
  • “Production costs are too high. How can we get our employees to work harder?” (Another option: Redesign the product for more efficient production.)

Do you ever find yourself boxed in by limited options? How do you break out?

Thinking Power Times Four

“Heart,” “Mind,” “Yes,” and “No.” If you can get your head into each of these modes, you can multiply your decision-making power by four in the new year. Let’s look at them one by one.

Funny hippie man holding a love heart and pointingHeart. Get into this mode by listening to your heart and your gut. Use your intuition. Bring out your feelings. What’s your immediate reaction? What’s your first impression? How do you feel about each option? Don’t try to explain or justify anything. Some people find this hard to do, thinking it’s irrational and flaky. For a long time, I prided myself in being totally rational and ignoring intuition. Lately, though, I’ve started to trust my gut. It’s even helped me be a better mathematician, if you can believe that. It turns out that all those instant gut reactions are not just random thoughts with no substance—they’re the expression of all your years of experience that you’ve internalized. Listen to them. For more on this, see Blink! by Malcolm Gladwell. This viewpoint also helps you prepare for the emotional responses of others. Have you ever had really good plans scuttled by someone else’s seemingly irrational reaction?

Businessman holding a laptopMind. Get into this mode by looking for factual data. Question everything. What do we know? How do we know it? What can we infer from that? What else do we need to find out to make a rational decision? Are we being swayed by irrational biases? How can we justify our decision? The “head” people will find this tedious and time-consuming, but it’s often the only way to sort out the complexities and do the trade-offs of a major decision. Humans are prone to a great many thinking errors, such as the sunk cost fallacy that I talked about a few blogs back. We also find it difficult to focus on more than a few things at a time, so a gathering of all the facts and an analysis of them is just about the only way to pull it all together. As a bonus, you get a rational justification for your decision that you can use to make your case.

Beautiful African American woman happy thumbs up isolated on whiYes. Get into this mode by looking for the positives. Start with a big smile and a thumbs-up. Look for opportunities and new ways of using what you have. Give yourself or your team a pep talk. What’s the best that can happen? What do we have available to us? What can we learn from our mistakes? How can we use this? How can we meet this need? You might think this is just empty cheerleading or the genial nodding of an unthinking yes-man, but this is an essential mindset for moving ahead, working through difficulties, comparing options, and seizing opportunities.

Young men expressing disgustNo. Get into this mode by looking for negatives and problems. Start with a scowl and a thumbs-down. Give the optimist a kick of reality. Get some grim realism into the discussion. What can go wrong? What are the problems? Why won’t it work? What’s the worst thing that could happen? You may be wondering why you would want this downer of a guy in your work group or in your head, talking smack and shooting down your ideas. Well, for one thing, he may be right. Better to anticipate the problems while you can still fix them. Better to know what might go wrong so you can have a work-around plan if it does. Much of decision-making is balancing what can go right against what can go wrong, so you need to understand the worst as well as the best. Finally, the “no” person acts as a devil’s advocate, asking the “yes” people to justify themselves.

You may find some of these modes more comfortable than others. Try them all on the next time you have a tough decision and see whether they help. If you’re working in a group, make sure all modes are represented. Value their contributions. That annoying guy who is shooting down every idea is giving a valuable “no” perspective. The nerd with the boring charts is giving you the “head” view. The hippie with no justification for various feelings is all “heart.” The cloyingly bubbly cheerleader is giving you the “yes” view. You need them all.

Have you ever tried taking on all these modes when making a decision, either alone or in a group? Was it hard? How did it affect the outcome?