A few weeks ago, a founder friend of mine asked me how I made decisions. In that moment, I realized that I had never consciously thought about my personal decision making framework. I do have evaluation frameworks for evaluating companies and for business decisions (typically along the lines of some form of statistical analysis). But I hadn’t thought about the core of my decision making methods when it comes to opinions or qualitative decisions.
When I find a topic, my first stop is general research. I typically read as much as I can until I’m able to put together a well-informed opinion about the space. I typically start with trying to understand how something works, and then move on to why it matters.
During that “why it matters” research, I specifically focus on finding patterns. Any sort of patterned opinion, topic, statistic or focus gets its own consideration, and I will write these as bullet points in my notebooks.
My next step is to turn my research outward. I’ll start talking to “experts” in the space — sometimes it’s the founders of the company, people working in the space, PhDs, researchers, people living it, etc. It’s from these conversations that I’ll evolve my opinions about the patterns I’ve found.
My goal in identifying patterns is to identify the strongest and most relevant patterns, and decide if I’m going to follow the patterns or break from them.
In some arenas, it makes sense to follow patterns because it leads to success. There was certain framework to building a newspaper business back in the 50’s that made sense. But consider that TV, Radio, Blogs, and Twitter broke from the existing pattern and resulted in multi-billion dollar industries and companies.
In the context of investment — people will bucket this pattern breaking into areas of bundling/unbundling, centralizing/decentralizing, etc.
Ironically, I realized that I’ve been looking at patterns for as long as I can remember. When I was 13, I entered an imaging technology competition, and I won first place at the regional event and made the top ten at the state event. When I made it to nationals, I got absolutely destroyed and didn’t think it was possible to win, but then I looked at all the entries and realized they all looked the same.
The next year I entered the competition, I decided that I was going to completely break the pattern. I read the rules inside and out and figured out every way in which I could push the envelope and deviate from the existing pattern so I would stand out in a sea of entries.
I ended up being the national champion the next year, and was always in the top three, if not the national champion for the next six years.
Since identifying my personal framework, I’ve started telling people about it and I’m working on evolving it. A few people have suggested putting my patterns into a decision matrix, other people have suggested breaking it down into buckets. Either way, the evolution of the way in which I make decisions has helped me figure out how to ask the right questions and how to be able to have analytical reasons for why I’ve made the choice I have.