Try This Method For Making Decisions

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blank page of notebook and tea cup

We’re constantly making decisions. From the micro decisions to the major ones, we are all keenly aware of how paralyzing it can sometimes be. Many experts have tackled this issue, but I just listened to author Cheryl Einhorn explain her AREA Method, decision-making system and felt like I needed to share her take.

Cheryl’s background in financial reporting for Barron’s gave her an intimate view of the intensity of the finance world. Her reporting also resulted direct consequences: the New York Stock Exchange putting stocks on hold, a drop in a stock’s price, and even a CEO put in jail. What she learned through making tough decision about what to report (or not), was that it is so important to be able to get to a place of conviction about your decision. But how to get there?

Her book, “Problem Solved: A Powerful System for Making Complex Decisions With Confidence and Conviction,” presents the AREA Method to help us do just that. How AREA works is that instead of feeling that immense pressure when we feel we have to make a decision immediately, we shift gears and take a step back and, as she describes, “… turn our problem upside down.” Look at it from the perspective of a question: What has to happen in the outcome of this decision for me to know that the decision has been successful for me personally? She also describes the need to identify 1-3 things that have to happen in the outcome for your vision of success to be complete.

A key emphasis for Einhorn is the absolute necessity of pausing to think. She uses a great metaphor for this: the “Cheetah pause”. I was unaware of this, but the cheetah’s awesomeness is not about how rapidly she can speed to her prey, but how fast she can slow herself down. Hence, the pause. Who knew? This process of slowing down is critical for decision-making as it builds agility, flexibility, and maneuverability.

The steps she lays out for the AREA method are:

  1. A – The Absolute. A close up on the target of your decision. Primary uninfluenced information from the source itself.
  2. R – The Relative. Secondary sources that are related to your target.
  3. E – Exploration and Exploitation. Exploration is information gathering. Exploitation is when you turn your lens inward and think about your own preconceived assumptions vs. the evidence you’ve gathered.
  4. A – Analysis. How does this all fit together?

I listened to a podcast of Einhorn being interviewed by Carol Fishman Cohen, the Founder of iRelaunch, a great organization that helps women who have taken a career break get back into the workforce. A real world example is when a woman wants to return to work. The clearer she is on what her vision of success looks like, the more successful she will be. Is it to be back in a team-environment? Finally pursue the work she really wants to do? To make money? Any of these would be the “absolute” and then the process would go from there.

I like having a process. There’s always an emotional component to decisions. How often have we “gone with our gut” and made decisions? And that is important. However, it’s also great to have a system that helps you to take a step back and bring in some rationality. You still might go solely with the gut, but great to have more tools in the toolkit, right?

Resources:

The Area Method

iRelaunch

 

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