THE DECISION MATRIX

When I am planning new ideas for my business or for my life, I like to use a tool I created called the Decision Matrix. It helps me decide which ideas or options fit into my value plan. This decision matrix can be used for any kind of decision you need to make in your life. I have used it to help me decide which jobs I should take, where I would like to live, and, yes, what businesses and scale ideas I should pursue. I love to use this model to appease the left hemisphere of my brain, which is the logical side. It does not always tell me exactly which option that I want to take, but it does help me weed out the options that are best not to take. It is really straightforward and simple.

Here’s how it works. Across the top of the paper, spreadsheet or whiteboard, I compose a list of the top 10 or 15 (maximum) things that are important to me for the particular decision I am trying to make. For example, in a business some of the things I might want that business to do would include making me a lot of money, allowing me flexibility of lifestyle, giving back to society, or requiring international travel. If I were making a decision on where to buy a new home, I may list across the top things like location, quality of schools, safety, friendliness of neighbors, quality of the construction, yard for the dog, a good view, and so on.

Once I have made my list across the top of the things that are most important to me in this decision, then I rate them in order of priority as to how important they are to me. The most important item would have a rating of 2. The next item would be ranked a 1.9, then 1.8, all the way down to the least important item.

In the business example, I may give “flexibility of lifestyle” a 1.8 rating and the “international travel,” which I love but which may not be as important to me as my lifestyle, a 1.5 rating. If I were moving to a new house, I would rate the quality of schools a 2, where I might rate the view I desire a 1.2.

Once I have my values of what I desire listed across the top and weighted in order of priority, then I list down on the left side all of the options I am considering. If I am thinking of ideas that would scale my business, I would list all of those down the left side. If I were purchasing a house, I would list all of the different property options down that left side. If I were deciding which job opportunity I wanted to pursue or which college to attend, or whatever it is I am deciding, I would list the options down the left side.

After my chart is complete, I ignore the weight factor of those important items and I fill in the blanks. I just go through really quickly and assess to the best of my judgment how my idea or decision would rank with my important item. I use a score of 1 to 10, with 10 being the highest. After I have filled out the chart, I simply take the score of the idea to the important item and multiply it by the weighted factor of that idea. I then sum all of the important items together for a score of each idea.

If there are several people involved, then I have each person do their own weight factor. We add up the weight factors and then use that number to score the spreadsheet. Together we decide the score between 1 to 10 of how well that idea would fit our needs. If my wife wants a good view and I want a shorter commute to work, we would weigh those items differently.

I like to do this exercise when I am relaxed and calm. It takes about an hour or so, but it is a really precise and fun way to sort out my ideas. Oftentimes, I’ll get the top four of five scoring ideas. These scores are not the only factors in my decisions, but they do usually tell me which of the options are not the ones that I want to pursue. It helps me to hone in a little bit to where I want to take my next zig or zag.