Sometimes decisions aren’t worth the cost of deciding

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This article is a reprint of an episode of my new podcast. You can visit the site of the original episode here.

Stever Robbins here. Welcome to the Get-It-Done Guy’s Quick and Dirty Tips to Work Less and Do More.

Today’s tip is about decisions. The bottom line? If it costs more to research and make a decision than the impact that decision will actually have, flip a coin instead.

In my first corporate job, we needed a laser printer for our programmers. The executives met to discuss it. After all, a $600 laser printer would only save twelve programmers hours worth of hassle. The marketing department had one, true, but then, they needed one. Otherwise, how could they print drafts of the billboard they erected, celebrating the company’s “Great Beginnings.”

In the end, they didn’t buy the printer. The programmers would just have to make do. And at night, I lay awake wondered: was this somehow my fault? In retrospect, perhaps I overestimated my own importance.

Decisions cost money

But I didn’t overestimate the decision’s importance. The decision not to buy the printer took four executives three one-hour meetings to make. The executives made about $100,000 a year, apiece, which is $50/hour. Multiply by four executives and three hours, and we’re talking $600 worth of management time to make that decision. They should have just spent the $600 on the darned printer.

This was the first time I saw that decisions cost money. And if it costs more to make a decision than the amount you’re deciding about, it’s more sensible to flip a coin or spend the money without further discussion. That’s why some businesses don’t even require receipts for small expenses when employees travel. It’s cheaper to reimburse $5 than handle the paperwork to document the expense.

Indirect costs can mount up

In my example, the cost was the executives’ salaries, but indirect costs can mount up, as well — costs of delays while the decision is being made, the cost of the distraction of having to make the decision, the cost of gathering information, and so on. And sometimes researching one decision leads you to expand the issue way, way too much.

For example (hypothetical, hah!), imagine the motor in your front- loading washing machine burns out for the sixth time, and you decide to buy a new washer. You call a saleswoman and she recommends an $800 model. But you want to be sure you’re making the right choice. So you demur and research begins.

You subscribe to ConsumerReports.org, you print descriptions of dozens of washers, and compare them feature by feature. You call the store and ask about delivery options and service plans. And you realize you can have your dryer venting cleaned as long as the workmen will be poking around. And, you know, since you’re moving the dryer to get at the duct, maybe you should just buy a new dryer to match the new washer.

Soon, your $800 purchase has become a major renovation. Your research gave you so many overspending opportunities that now you’re spending thousands on an extra appliance, delivery, and duct-cleaning. Oh, yeah–and during the project, you’ll be driving your laundry to the laundromat and spending two hours a week doing laundry in bad lighting.

You just spent hundreds of dollars, twelve hours of research time, six hours of laundromat duty, gas to drive there, and the self-esteem nightmare of laundromat lighting, all because you didn’t want to say “yes” to the saleswoman’s $800 suggestion. When you add it all up, you’d have been way better off just buying the dryer.

Non-monetary costs are important

Some decisions have a non-monetary cost. When you and your husband/ wife/transgendered partner or polyamorous family unit decide to go to dinner, you might want a sandwich whereas they want to try a new ethnic restaurant where the food still has eyeballs. Should you graciously say, “Yes,” firmly say “No,” or debate? If you debate, it could become an argument. If you smile brightly and say, “Yes, let’s be adventurous!”, you get major relationship brownie points. Maybe even extra snuggling. If you say, “No, let’s discuss it,” even if you settle on the food-with-a-face, you don’t get the points. With interpersonal decisions, sometimes saying “Yes, dear” and bypassing the decision can be worth way more than getting your way. And you can always order the rice as a safe backup dish.

If my first employers had just made decisions and spent money, instead of spending money to not-make decisions, they might have survived. You don’t need to make their mistake.

Today, put it to work. Review the major decisions you’re making about things to buy, places to go, people to see, and all that stuff. Notice how much work goes into each decision, and ask yourself how important each one really is. Then for the decisions that aren’t worth the cost of deciding, just flip a coin. You’ll free up your mind and you’ll move things forward, and all for less than it would take to make a decision.

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Just Flip a Coin Instead

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