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Insights of How To Decide by Annie Duke
Insights of How To Decide by Annie Duke
of How to Decide by Annie Duke
Great decision‐makers know when to decide quickly and when to slow down to gather more information. Decide quickly if a decision
passes ANY of these three tests:
Happiness Test
If you decide to order the salmon instead of the tuna for dinner and you hate the salmon, what effect does that decision
have on your happiness a week from now? Many decisions, like what to eat, watch, and wear, will have little impact on
your happiness a week from now (i.e., you quickly recover from a bad outcome).
The next time you’re stuck on a decision, conduct The Happiness Test by asking yourself: “Will my happiness, a week from now, depend on
this decision?” If not, decide quickly.
Only‐Option Test
Most decisions are threshold problems: gather options and determine which options meet your standards (which
options are satisfactory and which are not). However, once you have two or more options that meet your standards,
the decision is easy ‐ just pick one. Spending hours to determine which option is BEST is usually a waste of your time. If a
vacation to Paris has a 90% chance of being a great vacation, but a vacation to Rome might have a 91% chance of being a
great vacation, stop wasting your time and flip a coin. The faster you pick, the more time you’ll have to prepare for your vacation.
The next time you’re stuck between two great options, like going to Paris or Rome on vacation, isolate one option and ask yourself: “If this
were my only option, would I happily take it?” If so, decide quickly.
Two‐Way Door Test
“Some decisions are one‐way doors… If you walk through and don't like what you see on the other side, you can't get
back to where you were before. But most decisions aren't like that ‐ they are changeable, reversible ‐ they're two‐way
doors. If you've made a sub‐optimal two‐way door decision, you don't have to live with the consequences for that
long. You can reopen the door and go back through.” – Jeff Bezos
Determine if a decision is a two‐way door decision by routinely asking yourself: “What is the cost of quitting?” If the cost of quitting is low,
decide quickly.
The happiness test, the only‐option test, and the two‐way door test are three quick methods to help you be more decisive. But occasionally
you’ll run into a decision:
That could have a significant impact on your happiness.
Where no one option you would be happy with.
In which the quitting cost is high.
If this is the case you need to go slow, collect information, and construct target estimates.
Construct Decision Targets
Every decision depends on your estimate of the future. Deciding to take the freeway or a side road to work will depend on your estimate of
each option. If you believe the side road will take 15 minutes and the freeway will take 20 minutes, it’s a no‐brainer. Unfortunately, Google
can’t provide precise estimates for many decisions. Therefore, we need to exercise our estimating muscle and construct estimating targets
for significant decisions.
First, quantify a successful outcome. If you’re deciding to change jobs, success might
be the number of years you expect to work at the new company. Once you have a
success metric in mind, construct a target – the bullseye is your “best (educated)
guess,” and the width of the target is the space between your upper and lower
estimate (upper and lower bounds). For example, if you think you’ll stay five years at
the new job but believe you could stay as long as ten years and as little as three
months, your upper bound is ten years and your lower bound is three months.
Determine the upper and lower bound for any estimate by conducting The Shock Test.
Ask yourself: “Would I be shocked if the result was higher than my upper bound and
lower than my lower bound?”
Search for information that will refine your target: adjust your upper bound, lower bound, and best guess (i.e., shrink your target width
and adjust your bullseye). When you search for information, share your upper bound, lower bound, and bullseye estimate with people who
have relevant experience. Put whatever information you find while refining your upper bound, lower bound, and bullseye in a notebook
labeled “Knowledge Tracker.” When you write down everything you learn during the pre‐decision phase in your “Knowledge Tracker”
notebook, you are less likely to beat yourself up if you get a bad result since you can look back and see that you went to great lengths to
make an informed decision.
There will come a point when you need to stop researching and estimating and make a decision…but when? I like to follow Jeff Bezos
advice: “Most decisions should probably be made with somewhere around 70% of the information you wish you had.”
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