Loading summary
Transcript1 lines
- [00:00]
A
Hey, this is Sharan Srivatsa. Welcome back to the Business School podcast. In this episode I'm going to teach you how to make decisions. In fact, most people in the world make decisions based on their experience or seeing someone else make decisions or what is probably good for them or incentives or say things like, oh, this doesn't serve me, but what I've learned over time. And I'm going to give you a billionaire story around this. Learning to build a framework for how to make important decisions. I'm going to break it all down step by step, starting right now. One thing is for certain, just because it's tried and true doesn't mean it's working right now. So the big question is this, where can you learn what is working right now? The strategies, the tactics, the psychology and the exact how to, how to grow your business, how to blow up your personal brand and supercharge your personal growth. That is the question and this podcast will give you the answer. My name is Sharan Trivatha and welcome to Business School Foreign. To break down for you the decision mapping method. So essentially the main premise of this episode is this. Our lives are just a compounding machine of the decisions that we make. If you choose to have a burger and fries every day for the next 30 days, you are a compounding machine of those decisions. If you choose to wake up at 5am and meditate and work out, you are a compounding machine of that. You know that decision framework. If you choose to work hard, you are a compounding machine of that work for the next 30 days. But if you choose to work smart, as in you know exactly what you need to work hard on, but you still work hard, then you have the compounding machine of those decisions, which means that how we make decisions is really important. So I want to tell you a story of how all of this came about. And I didn't know anything, anything it got to do with anything. But it makes me think of this quote which is the quality of your life is determined by the quality of your decisions. And that's a Tony Robbins quote and I never realized what it meant until much later in life. And so when you have like a 19 year old listening to this and saying, oh yeah, you know, I can, I can conquer the world. Well, you just, you don't have any perspective for these quotes because I don't understand what they mean now. I do. Because your life is just a compounding machine for all the decisions that you made. So it's probably makes sense to have some kind of framework for making these decisions. So let me tell you how all of this came about. After we sold our first company, I spent a few years teaching tennis, and my first stop was in the Caribbean, where I got to meet Richard Branson on Necker island and got to play tennis with him. And so I was playing tennis, and, you know, it's kind of weird to ask him about stuff and ask him questions, et cetera. So I'd probably spending a good 30, 60, 90 minutes thinking about a good question to ask on a changeover when we're sitting between games. And finally, I asked him a question. I asked him, hey, so how do you make decisions? And he took a sip of his carrot juice, and I will never forget, and he responded with a story, not a formula. And that's very apropos for Branson because he never gave any specific, go do this thing. He just talked about a story or an experience on what he learned and how he made decisions. And I will save you the story, but I'll give you the insight. The big insight was this. He. He explained to me that the biggest mistake that people make is not knowing their own process for making their decisions. So if I asked you, hey, what process do you make to make decisions? What would you say? Now, you may be using the same process naturally, over and over. You may always make good decisions. I guarantee you there's probably a decision that you made that you're not happy with. Did you use a different process for that, or did you use the same process and it not work? Was that because your current process is flawed, or was that because you were not ready? What was it? We don't know. And there's a lot of advice on the Internet, just super pithy advice that, like, how do you actually make good decisions? But I think that we want to take Branson's advice here. The biggest mistake that people make is not knowing their own process for making decisions. So what I did, I wrote down a hypothesis because I didn't know what the process was, what process I use. So I wrote down a hypothesis, and I said, hey, this is how I make some decisions. And, like, what is good for me? Does it make me money? Am I happy? You know, do I get paid? Like, am I doing it with my friends? There's some people are like, oh, I want to do epic things with epic people. Like, what does that mean? That's not how you make decisions. Like, that's. That's a cool, cute thing to say. But we don't know what exactly that means. So I Want to give you a four step process for how I came up with over the years for what I use right now to make decisions. And let me tell you what, what that is. Step one, understand the context. Step two, isolate the issue. Step three, accept the risk. And step four, map the decision. Please, please, please let me explain so you understand it and you can just do all of this in your head. Because the first step is to understand the context. And I will tell you, there's nothing more important than understanding this. I will tell you I'm a big reader of the Harvard Business Review because they do a good job of like doing a lot of research around this. And so there's some form of like research and statistical significance to this process. And they say, hey, leaders who ask more clarifying questions before deciding on how to improve a decision make better decisions by over a third. So you probably have heard this Einstein quote, which I will never forget, which is, if I had an hour to solve a problem, I'd spend 55 minutes thinking about the problem. Why? Because you let the neural patterns form and you think through the problem and then you let the decision flow. And I think that the, the number one mistake that amateurs make is they jump straight into fixing things. But the number one thing that the pros do differently is that they zoom out. So my question is, can you force yourself to ask a context revealing question upfront even though you know the answer is even though you know how to actually do it? So for example, right, let's say someone presents an idea to you and it's a potential problem, the first thing you should do to force yourself not to solve the problem, just scoot back and say, okay, so ask the question about context, zoom out and say, well, can you help me understand why we're talking about this right now, or can you help me understand like the three things that happen that make this important right now? Oh, can I actually recap for you what I know about the situation? What am I doing here? I'm just ensuring that I understand the lay of the land. I'm ensuring that I have enough context. I'm literally understanding the context of this. Because once you understand the context, what it does is it primes you neurally in your brain to start activating the knowledge that you have in that context. Otherwise you're just making, you're making the decisions. The key question I want to ask is I want to figure out what don't I know yet, right? And so by the way, the easy way to run through this is like you've heard various versions of this. There's no order specific to this. It's the who, what, when, where, why? Right? Hey, why are we talking about this? What exactly is the problem? Who's involved in this? Where did this happen? When is the timeline important? I just ask those questions. So after I ask those questions, then it's easy to say to go to the next step. But the job, whenever you're presented with something, is ask the clarifying questions. Because a lot of times when people bring problems to us, what they do is they truncate, they make a lot of assumptions. Now, I want to make a very, very simple statement here. If you just did this for yourself, you may say, well, Shiron, I don't. I don't work closely with a lot of people. I kind of make decisions on my own. I'm kind of in my head. I have all the context. Why do I need to do this? This is even more important to know this because you. You've not. I. You've not kind of managed the context. So what I would do in a situation like this is if I. I always think about this. Whenever I have a tough decision at. At hand, I write a document, essentially a memo describing that situation to my coach. Now, the reason I do this is because I, I don't need to send her the. The document. I just write it so that as and when I'm ready to send it to her, I send her something that she has full context on, and I don't have to rewrite everything or get the information around it. So what I do is I write this document as a context document. I literally, I. I write it, you know, as I'm explaining it to her, I'm like, hey, here's what it is. Here's what happened. Here are the things you need to know. I know that she has no context, so I start to give her all the context. That whenever my decisions are big, that the issue that happens is I understand that even I may have forgotten a lot of the context, but if I'm sharing that context with someone else, I put all the context into one container. That allows me to look at the. Look at it and not freak out about it or not have some visceral reaction to it or not be emotional about it overall, right? So I think that is super, super important. The main part here is you want to figure out how can you get more context so that the step one is understand the context. Now this leads to step two, which is once you understand the context, you want to figure out how to isolate the issue. Right? What does isolating the issue mean? There's clearly a problem that needs to be solved, so I need to isolate that issue. So the context has 20 pieces, but we're isolating the thing. So you're saying, hey, we ran this event. We're doing all of this, but the event sales slowed down. Okay? The event sales slowed down. I'm isolating the issue. Right? So the. If you. The. I would tell you, for most people, just isolating the issue alone will give you a lot of confidence because you know exactly what you're talking about. Otherwise, you just want to talk in circles. I will tell you, poor definition of the problem leads to more than 80% of strategy decisions. If you're isolating the wrong issue, you will actually make the wrong decision because you're, you know, you got knee pain and you're working on the shoulder, right? It doesn't matter. And. And there's a great quote by Charles Scuttering, and he says, a problem well stated is a problem half solved. Probably one of my favorite quotes ever. A problem well stated is a problem half solved. And what we're doing is isolating the issue. Right? So in a lot of ways, if you work with our teams@acquisite.com, you will hear this word often. Which is the constraint. What is the constraint that we're trying to solve here? And that is the real bottleneck, because what is the job of business? Every business works fine, but something is stuck. Some. There's a bottleneck somewhere. That is the constraint. And our job is to isolate and find the constraint and then put massive energy to solving that constraint. And as soon as you solve that constraint, the constraint will move and there will be the next constraint in the business. Then our job is to isolate that constraint correctly and put massive effort and energy into solving that constraint. Then what do we do? We find the next constraint. And our job is to put massive energy and focus into solving the next constraint. Welcome to business. Every business in its different levels has a different constraint. And the reason why someone ahead of you can answer a lot of these questions is because. Is because of one single thing is because they can isolate the constraints for you. Right. Sorry for the background noise. You got a little parade coming here. Now the big question is like, okay, so you want to isolate this constraint. So the question that I would ask is, okay, what is really holding us back? And then they'll say, well, it's the ticket sales. I'm like, okay, is it the ticket sales, or is there something else? And So I think writing the problem in one sentence before you're deciding on an action is really important. I will tell you the crazy part in all of this. We have gone through several meetings as a leadership team@acquisite.com where the entire goal or job of that meeting is to do only one thing, is you spend 60 to 90 minutes not solving the problem, just isolating the constraint. We do a 60 minute or 90 minute meeting just to agree on what the problem is, because the problem will state it as a problem have solved, right? So step two is to isolate the constraint. Here's step three, which is to accept the risk. And what do I mean by accepting the risk? Every decision is a trade off. You're, you're saying yes to one thing because. And you're saying no to something else. That, that, that is why this is really important, because you can make an informed decision. But it comes from a long tradition of guessing and then blaming others for these inadequate results. It's crazy. Like there is no, there's hardly any decision that you can make. A decision is what a decision come the, the, the etymology or the root of the word decision is to be decisive. That the way the word decisive is to cut off. You're cutting off other options. You're cutting off other choices so that you can make a specific decision right now that is what the most important thing is. The inability to assess a risk is one of the top three reasons why businesses fail. So you're probably saying, okay, I'm cutting off these decisions, I'm making a choice and there's some risks in doing this. What is the risk? And we may call that judgment, but it's really about trade offs, right? If you make this decision, what else are you saying no to? What else get affected? I will tell you, this is inversion, right? So you know, the inversion is a great concept by Charlie Munger. He says, hey, if you want to make a lot of profits in your company, what do you do? Well, just take the opposite pain. Hey, if you want to ensure that you make no profits in your company, what do you do? And then you outline all those things and then the problem is you just don't do those things. I'll tell you a very simple reason away on how you can be a very good person, right? You think of, instead of saying, how do I become a good person? You just think about all the people that you don't appreciate, right? Think about the person that you don't appreciate and you say, okay, that guy, I don't appreciate him. Why? Well, because he does this, this and this. Great. Well, just don't do those things. Most of the time it is not doing those things that actually make us make us better. And so that is the risk. It's like what are the things that you that are going to break down based on this decision? And if I can identify those risks, then I can make peace with those risks. I know that that becomes a non negotiable and I'm like, okay, I'm okay with saying yes project because it's going to make me say no to these three other projects. I know that those are the risk. And so what do I do? I accept the risk. And that is step three. Most people don't accept the risk and they want to win in every scenario and they don't realize that the trade off is the decision. A decision is the trade off. If you're going to make a decision. I'll give you a simple example. If you want to grow your business, you may say, well, let's say you want to get more media out. Well, if you want to get more media in your business, say making more content, well, you have one of two options. You can either hire somebody, so spend the money to make more content. Which means that in the short term you're going to write a check to spend somebody, spend some more money to get more content. But for a while you're going to get no ROI from that. Which means the risk is that you're accepting the risk that you're not going to take home that extra profit overall. And most people can't deal with that risk, right? Or if you don't want to take that risk, now you have a different option which is if you want to keep that profit and you want to keep that money and it's required for your lifestyle or your expenses or whatever. Then you say, hey, know what? To make more content, I'm just going to work an extra 20 hours this week. Well, if you're already working 60 hours and you want to work an extra 20 hours, you're probably working another. You know, you're probably waking up early and you're, you're working 4:00am to 7:00am now you know that you're going to work 4:00am to 7:00am but what is the risk of that? The risk of that is you don't sleep enough. The risk of that is you're cranky at night. The risk of that is you're not friendly with your family. The risk of that you get, you know, you, you get some health issues. The risk of that you don't. You get poor sleep. The risk of that, you midnight snack. So you understand that those are the risks that you accept. But you get to keep the money, right? So you, there is no free trade. You're going to trade something for something else. Life is all about trade offs and that is what a decision is. But if you understand the risks upfront and you accept them, then it's easy to understand the decision. And step four is to map the decision. What do I mean by map the decision? I will tell you that a decision without action is just a thought. You agreed on something and people forget it's just a thought. So the two questions to ask whenever, like let me give you this. And whenever you are going to leave a meeting with your team, you should ask a question like this. What did we decide and what happens next? Right. What did we decide and what happens next? Hey, we decided on these three things we're going to spend on media. We're going to get a content person and you're going to shoot for an extra hour. Great. That's what we decide what happens next. I'm going to find the person, you're going to change your schedule and we're going to come up with a budget. What did we decide what happens next? And the reason is always finish a, a meeting or with a decision summary and the next steps. Because now I will tell you what I write. You know, when I write to my coach, I just write out big. I probably my goal in my role, I probably have to make 10 big decisions a month. And I write down all my decisions in a memo format because at the end I can go back and see or I can share that memo with my partners or with my coach and be like, did I make, did I think through this the right way? And every time I do that, the next time I write that I'm better at making the decisions. But I follow the same process, right? You can use it as a checkpoint to review later. And whenever there are big decisions, I will tell you this. You should never make. You should always make big decisions on paper and you should write it in such a way that you're explaining this is this decision to someone else. And I always think about, you know, I always. My best advice that I got from my mentor early on was he said always assume you have a board of directors who love you and care about you, but you still have to get permission from them so that you can get their advice right. So you got to just run things by them. And how do you run things by your board of advisors. I was like, well, if it's an imaginary board, I'm writing this letter to my board. So I'm writing this memo for my board. I write it to that. A lot of times I've told people, I'm like, hey, you should write this idea down. They're like, well, do I write in first person or second person? Well, how much detail do I explain? That's why the reason you have a struggle like that not knowing what to write is mainly because you don't know who you're writing to, who you're writing for. So when I always think about I'm writing to my personal board of advisors or I'm writing to my coach, I know that I have to. One, I have to understand, you know, I really have to understand the context. So I have to give them the context. Second, I'm going to have to isolate the issue. Literally. I follow this format. I'm like, here's the context, and I give them all the context. Then I'm like, here's the issue. Then I isolate the issue because a problem will state it as a problem have solved, right? I say, hey, even before I get to the solution, I want to accept the risks that are going to happen based on this issue. I give them the risks, and then I say, based on that, this is the decision I'm going to. I want to make. And then I say, well, here's the decision, here's why, and here's what happens next. Now when someone reads through it, they're like, okay, have you considered this? Or that they're able to think through that process? The reason I'm bringing this up is Branson's point. Richard Branson was very subtle when he said, but I think it was very huge. It's not about making the perfect decisions because you're not gonna be able to do that, but it's about knowing your process. I'm not saying that you should use my process, but. But I really think that decision making is a leadership meta skill. Probably the leadership meta skill. Probably. When people say he has good judgment, what does that mean? That his judgment just means that he is a process for making decisions. Literally. What is judgment? Oh, he's good judgment. What is that? What does it mean? Well, he has a. He has a good process for making decisions, and you don't know that process. And he's really good about. He or she's really good about the process. If you know your method, you can scale it, you can delegate it, you can Adapt it, you can learn it, you can iterate it, you can get better. I will tell you this process that I came up with, which is, number one, understanding the context, number two, isolating the issue, number three, accepting the risk, and number four, mapping the decision. I came up with this for myself. So when I get stuck and I'm writing my memo to my coach, I write under, here's the context, here's the issue, here are the risks, here's the decision. Right now. You know what the next steps are. If you do this, you will make. If there's any big decision that you have in your life, you can just do this. By the way, let me tell you how to do this without you having to write a word. You get in front of your computer with AI, maybe go for a walk and say, or you can just literally, the transcript on this of this audio is going to be on the show notes, just copy the whole thing, feed it into AI and say, hey, I want to follow Shaun's process for making decisions. And then say, interview me on these steps. And then the AI will just interview you. And then you just hit AI into talk mode. And you just talk about the context. You just talk about the isolation. You just talk about, you know, the risks, and you just talk about, you know, what you're going to do for next steps. And what the AI will do is it'll map this decision for you. It will build a memo that you can send to an advisor, a coach, me, whatever, in this process, because now you've actually thought through it and you see all the, you see all the data in front of you because it allows you to make a good decision. That is what you know, the decision mapping framework is. And I will tell you this, if this is what Branson thinks is the biggest mistake, you got to give him a little credit, right? Like, he's seen a lot of businesses. And if this is what I'm telling you, that helped me and it's probably my superpower, which is what do people call judgment? That having a good process for making decisions, you probably should consider yours too. Now, I'm going to wager that yours is pretty good. If you're. If you've done made good decisions in your life, you're pretty good. But it's worth kind of articulating and writing it down. Maybe you take parts of my process. It doesn't want. You don't want it to be seven steps, but it can be quick and easy. But you need to be able to run through in your head, understand the context, isolate the issue, accept the risks, and map the decision. Right? That way you know what the next steps are. Hey, I hope this is helpful to you. Like if, if you have a mastermind group or if you have a coach or consultant, or if you, you know, want your team members to be doing the same thing, drop it in the Slack channel. Have them do the same thing because they can do the same thing as well. That way they understand this. And if you want to share it with somebody, please do. Because I think that we can all benefit from having better judgment, which is having a good process for making decisions. So if you like this, please do me a favor, screenshot this and tag me. That way I can make more like this for you. So please, if you like this, screenshot this and tag me. And I'd be excited to make more like this for you. Hey, this is Sharon. I have an awesome free gift for you just for listening to the podcast. As you may know, I've got a chance to build $2 billion companies the hard way. So if you like this, this episode, you will love getting the exact playbooks from those wins. It's on my substack called My Next Billion. It has the exact frameworks I wish someone had given me when I was figuring it all out. Now you get the real lessons from the trenches as I go for a three peat and build the next billion. So everything's free at my next billion dot com. Please check it out. My nextbillion dot com.