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How to Make a Decision: Top 5 Decision-Making Tools

Making decisions can be difficult. These 5 frameworks can help you land on the best decision for you!

how to make a decision

We’ve all made a bad decision or two:

  • Texting your ex
  • Having Chipotle right before a job interview
  • Starting a new show at 11:30 p.m. (It’s never just one episode).

Business leaders, college students, nighttime vigilantes — we all have to make tough decisions. But strangely, many of us make decisions without any kind of framework to guide them.

Would you build a bridge without a blueprint? Or write an essay without an outline? (Okay, bad example — we’ve all done that last one). 

The point is that decisions come up too frequently to just play them by ear. That’s why we will go over five frameworks that make the decision-making process more manageable.

5 Excellent Decision-Making Frameworks


The Decision Matrix


A decision matrix is a powerful tool for decision-making because it forces you to weigh your options, like the red pill or blue pill. (See what we did there?) 

You should use it whenever you have many options to weigh against multiple criteria. It’s convenient if you like to take a numbers approach to your decisions.

The core idea is to rate each option on different factors and then choose the option with the best overall score.

We’ll start with a simple example — let’s say you’re deciding on a new phone to buy. You have two options:

  • The iPhone 13
  • The Samsung Galaxy S21

Your decision matrix is a table. Your options are the rows, and your columns are the factors/attributes. The ones most important to you may be:

  • Price
  • Storage space
  • Camera quality
Price Storage Space Camera Quality Total Score
Weight
iPhone 13
Galaxy S21

Next, you want to weigh the importance of each factor relative to the others. Maybe the price is the most important factor, followed by camera quality, then storage space. You can choose any scale, but let’s do 1 – 5 for simplicity.

Price Storage Space Camera Quality Total Score
Weight 5 3 1
iPhone 13
Galaxy S21

We’re almost done! Now you need to score each option by how well it achieves each factor. Again, you can pick any scale, so we’ll go with 1 – 5.

Price Storage Space Camera Quality Total Score
Weight 5 3 1
iPhone 13 2 4 4
Galaxy S21 3 4 3

Now it’s time for some math. Multiply each score by the corresponding weight, then add them all up to get a total score. For the iPhone 13, this would look like this:

(5 × 2) + (3 × 4) + (1 × 4) = 26

(Weights are bolded)

Price Storage Space Camera Quality Total Score
Weight 5 3 1
iPhone 13 2 4 4 26
Galaxy S21 3 4 3 30

The option with the highest score is your best choice! If you feel like you got the wrong answer, don’t worry — it’s not your math skills. You probably just weighed some factors incorrectly, or maybe you’re missing some others.

Want to try it yourself? You can find a free worksheet here or use a spreadsheet tool like Google Sheets or Excel. There are a bunch of great templates available online as well! For an all-in-one solution, Ruminate comes with templates for all sorts of decision types.


Pareto Analysis


Pareto analysis is also called the 80/20 rule because it says that
20% of your efforts lead to 80% of your results. It’s based on an idea by Vilfredo Pareto, who noticed that about 20% of people owned about 80% of all wealth in Italy when he was studying it (the 1880s).

In fact, you’ve probably seen this in your own life: 

  • An essay you complete in the two hours before it’s due. 
  • The three or four songs that make you download the entire album.
  • In businesses, 20% of factors frequently contribute to 80% of an organization’s growth.

Pareto analysis is helpful if you need to narrow down priorities. Maybe you’re part of too many clubs, or you’re spending too much on bubble tea toppings. If you have to make many decisions, it also helps you decide which ones you should make first — 20% of them probably have 80% of the impact.

This decision-making technique is more of a mental model than a mathematical one like the decision matrix. When business management uses it, they’ll apply it to strategic planning.

If you want to use it, just ask yourself which decisions, activities, or bubble tea toppings drive the most impact. (The correct answer is tapioca and coconut jelly, by the way). Then simply prioritize those above all others.


T-Chart (Pros & Cons List)


You’re probably very familiar with the T-chart (or pros and cons list). It’s a bit like a cost-benefit analysis but much more applicable to real-life than business decisions.

When making a T-chart, list the positive aspects of a choice in one column (pros) and all the negative elements in the other (cons). This is most useful when you have a single big decision to make, often a choice between doing or not doing. T-charts are also easy to collaborate on, so team members and friends can join in too.

Let’s try it out:

Should You Text Your Ex?

Pros:

  • They’ve started going to the gym
  • You miss their dog and could get to see them again

Cons:

  • Just.
  • Don’t.
  • Do it.
  • We’re serious!

Just kidding — if Ross and Rachel have taught us anything, it’s that pros/cons lists are not suitable for your dating life. Here are some general tips:

  • Tip 1: Pros should be uplifting and exciting. They might not be super compelling if you have to think too hard about the pros.
  • Tip 2: Cons should be realistic. Hypothetical cons can be helpful, but they don’t hold much weight.
  • Tip 3: You can change the order of pros or cons so they’re in order of importance. One big con might be more important than five weak pros.

You can use anything to make a pros and cons list; a Google Docs or Word document, or even pen and paper. For a more advanced helper, try Proco. Proco lets you add weights to your pros and cons like the decision matrix here.


Inversion


Inversion is a technique that involves inverting the problem and seeing it from a different perspective. Since many problems become easier when we think about them differently, this is a beneficial technique.

It’s helpful when you’re facing several decisions, and you need to decide which choices to avoid — kind of like a map that shows you where all the land mines are. In this way, inversion is more like a guide than a decision-making framework.

To use inversion, just take whatever you’re trying to solve and flip it around. It takes three steps:

  1. Start with the very end result you want.
  2. Imagine the opposite.
  3. Ask yourself everything you’d have to do to make that opposite happen.

Now, just avoid those things!

Let’s use an example. Say your goal is to become physically healthier. The two end results you’re looking for are:

  • A steady sleep schedule
  • A consistently healthy diet

What are the opposites?

  • An inconsistent sleep schedule
  • An unhealthy diet

How would you achieve those things?

  • Doing activities with unpredictable hours
  • Buying fast food very frequently

Now we know your Kryptonites, but how do they help you make decisions? Let’s use two hypothetical scenarios.

  • You have two job offers. One of them is a part-time remote gig that requires 20 hours a week. The other one pays better, but it’s an on-call job, so you never know when you’ll need to work. According to inversion, you should avoid the latter.
  • You’re moving apartments. One is closer to a grocery store and has slightly higher rent, while the other is near a fast food plaza. Since you want to avoid situations where you buy fast food, you should choose the former.

Of course, a lot more goes into decisions this big. But inversion can help guide your formal decision-making process. You don’t need high-tech to use this model: writing down your ideas as we did here will work just fine.


Second-Order Conditions


Second-order thinking (or second-level thinking) is a tool that separates great decision-makers from good ones. The best part? It all comes down to one question:
And then what?

First-order conditions are the immediate consequences of your actions. Second-order conditions are the things that happen because of those consequences. 

Since big decisions usually have the most significant ripple effects, you’ll want to use this particular strategy for crucial choices.

Let’s use the apartment example again.

  • Apartment A is near a grocery store and close to campus but doesn’t have any lease signing bonuses.
  • Apartment B is by a fast food plaza and further away from campus but has a lease-signing bonus.
Options First-Order Second-Order
Apartment A
  • No sign-up bonus
  • Buy more groceries
  • Quicker commutes to campus
Apartment B
  • Sign-up bonus
  • Buy more fast food
  • Longer commute to campus

(Here, we’ve underlined the positive consequences but left the negative ones alone. You can also colour code or highlight.)

Apartment A has short-term drawbacks but long-term benefits. So while moving to Apartment B has more short-term benefits, it may be the wrong decision in the long run. Look, we’re here for a good time, not a long time — but prioritizing the long-term is usually the right way to go.


6 General Decision-Making Tips


No matter what decision you face, here are some tips that you can always count on:

  • Don’t make too many big decisions in one day. Decision fatigue is a huge problem, and you can only make so many good calls in a day.
  • Keep records of the big decisions you make and how they turn out. This way, you can evaluate the decision-making techniques you used.
  • Consider all possible scenarios when making a big decision. Learn from your mistakes and develop a plan for the future.
  • Always ask yourself, “Am I in the right place at the right time?” This is a fundamental question that can change everything.
  • Use visualization to help you make decisions in everyday life. It’s also a great way to stimulate creativity.
  • Occam’s Razor is that the simplest solution is usually the best one. If you’re struggling with complex options, sometimes the one with the fewest moving parts is ideal.


You Can Make Better Decisions Today


Let’s do a quick recap:

Decision matrix

  • Uses a weighted-factor scoring system. 
  • It’s best for decisions with multiple options.
  • Not for fast and inconsequential ones. (Like choosing your character in Smash Bros., for example).

Pareto analysis

  • The principle says 20% of your efforts lead to 80% of your results. 
  • It’s suitable for prioritizing decisions and options. 
  • If you’re applying it to daily life, don’t bother making it too mathematical.

T-Chart

  • A list of pros and cons that you can use when decision-making. 
  • It’s good for do/don’t do decisions. 
  • It isn’t very in-depth.

Inversion

  • All about avoiding the choices that lead to the opposite of your goal. 
  • It helps guide your overall decision-making
  • Not for specific choices.

Second-order thinking

  • Forces you to think about what happens next — the consequences of the consequences. 
  • It’s helpful for big long-term decisions.
  • It’ll require some strategic thinking on your part.

Now that your brain is filled with elite decision-making tools, you’re ready to make choices like business leaders and experts. So get out there! Chocolate or vanilla, red pill or blue pill, to be or not to be — you’ve got it in the bag.

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Frequently Asked Questions (FAQs)


What are the 5 decision-making tools?


There’s no set list of universal decision-making tools, but these five are helpful in many situations:

  • Decision matrix
  • Pareto analysis
  • T-chart
  • Inversion
  • Second-order thinking

You can use these decision-making tools for business decisions, everyday life, school, and more.


What are the best decision-making tools online?


You can use most decision-making tools with just a pen and paper, but these templates and apps make it easier:


How do you decide between two jobs?


You can use Pareto analysis decision-making to break down each job, factor in salary and other circumstances, and see which one is more beneficial. For this method to work, don’t skimp on the math. Include all factors that might affect your decision-making process, so you know what you’re getting into.

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