A decision is the act of choosing between different options or courses of action, often after considering various factors and potential outcomes. The process of decision-making involves evaluating available information, considering different options, and ultimately choosing one.
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​Making a decision takes time and energy - both of which are limited. And when we're faced with thousands in a day, we eventually come face-to- face with decision fatigue. Everyone has their own tolerance for how many decisions they can handle and resolve confidently. But eventually, we'll hit a point where our ability to come to a rational and sound conclusion. 
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​Bottom line - we are more likely to make bad decisions. Plus, we deplete our energy that could be spent in better ways. 
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​The first step in streamlining this process is figuring out what type of decision you're making. Not every decision is worthy of boundless time and energy.

Operational decisions are the day-to-day, short-term decisions that mainly focus on executing your daily activities. The impact of these decisions is usually minimal, immediate, and short-lived. They include things like what to have for dinner, what to wear, or what show to watch tonight.
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​A key question to ask yourself to identify an operational decision: "Will this matter in the next 10 minutes?"

Tactical decisions impact the medium-term and can often be in support of long term plans. They may not matter several years down the road, but require more thought than choosing what shoes to wear today. Decisions in this category could include choosing a vacation destination, picking a class schedule, deciding to train for a race or event, or buying an expensive household item like a computer or couch.
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​A key question to ask yourself to identify a tactical decision: "Will this matter in the next 10 months?"

Strategic decisions are the long-term, high-level decisions, and usually set an overall direction for your life. We don't know the outcomes of these decisions, and often take careful consideration of our options. Getting married or divorced, having a kid (or not), buying a house, or changing jobs all fall into this category.
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​A key question to ask yourself to identify a strategic decision: "Will this matter in the next 10 years?"

​These terms are used mainly in business or organizational settings and don't really make sense for our personal lives. You'll never hear anyone say, "Honey, let's discuss the strategic decisions for our household."
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​Fortunately, James Clear, the habit expert has a more relatable metaphor for how to look at our decisions. He thinks of decisions in three ways: hats, haircuts, and tattoos - which perfectly correlate to the business terms operational, tactical, and strategic.

Like hats, a hat decision is low stakes. You try one and if you don't like it, you put it back and try another. The cost is low, and it's easy to try several.
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​A haircut decision has a little more permanence. If you get a bad haircut or make a bad haircut decision, you can fix it. It might not be quick, and you may have to go through an awkward phase. You can take on some risk even if it might not work on, knowing you can move past it.
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​With a tattoo, it's a decision that you have to live with. If you get a bad tattoo, you'll see it every time you look in the mirror and be reminded of the poor choice. Even if you get it removed (or cover it up), there will still be a mark.

All decisions can be addressed with three steps:

Identify the type of decision
We run into problems when we treat all decisions the same. Hat decisions shouldn't be approached like a tattoo decision. That's why the first step in the decision-making process is to identify the type of decision you are facing.
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Pick the right approach​
Once you identify the type of decision, you will move on to the second step - Pick the right approach. Each type of decision has approaches that are best suited for that category. Keep scrolling for more info...
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​Review and release
​The final step has two phases:
​First, review the outcome of your decision. The level and frequency of the decision will determine the complexity of the review. It could be as simple as I like the outcome or I didn't like the like the outcome. Some decisions may not warrant a review. For instance, you probably shouldn't evaluate whether having children was a good move. The realization that it was a mistake isn't likely to provide value or make you a better parent.
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​The second phase, to release, is a must. Whatever the outcome, you have to let it go. Whether you like the results or not, you need to accept it and move on. Accept it and figure out what you are going to do about it (if anything).

The key to an easy Hat Decision is to acknowledge what it is. Per its definition, at the end of the day, the outcomes have very little long-term impact. By acknowledging this, it can alleviate any perceived pressure. Hat decisions take up the bulk of out daily mental tug of war and make us most susceptible to decision fatigue. Save that energy for something that truly matters. Here are other approaches to lighten the load:
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​Automate
​When you have an automatic response for a particular situation, a decision is no longer necessary. The most classic example is President Obama's decision to wear the same suit every day. He knew he would be faced with many critical decisions as president, and he didn't want to waste any extra energy on picking out a tie. You make not want to resign yourself to wearing a "uniform" every day, but you can streamline the process by having and Monday outfit, a Tuesday outfit, and so on. You can also automate meal options in a similar fashion (Meatless Mondays, Taco Tuesdays - you get it). Financial decisions are a prime area for automation with established transfers to savings or retirement funds and auto bill pay.
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​Batch
​Batching involves making several similar decisions in a set time period. This could involve planning meals or workouts for the week, or setting aside time to make decisions for a specific project, such as a home renovation. Batching decisions is especially helpful when the outcome involves other people. Do you really want to have the "what's for dinner conversation" on a daily basis? Tip for success: Pick a time for batching when you are fresh (not tired, or hungry)
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​Delegate
​Let someone else decide. Set parameters if you need to, but otherwise, be hands off and accept the decision. Can't decide what to order at a restaurant? Ask the server to pick. Just make sure it's someone you can trust and then fully accept the decision (no take backs!).
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​Create guidelines and filters
​Guidelines are best for binary decisions. For example, a guiding principle could be, "If it's not a hell yes, then it's a no." Trying to decide to attend a future event? If you wouldn't say yes if it was happening tomorrow, then don't say yes to attending in the future.
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​Set up guidelines for certain situations where you decide to always say yes or always say no. A new flavor of Oreos to try? Always a yes. A second glass of wine? Always a no.
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​Filters work well with a decision with multiple choices. Think of it like shopping on Amazon. You filter your search results based on preferences. And you are probably already doing this with TV shows, books, and music. 

Haircut decisions can require careful consideration, but not so much analysis that you curl into a ball unable to make a move. And there are ways to make them easier.
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​Past experience
​Use past experience to make future decisions. Even seemingly unrelated evaluations can provide insights into your current decisions. It helps to know yourself well and understand your reactions to the outcomes of past experiences.
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​Consult experts or professionals.
​Experts and professionals can provide valuable advice based on their area of expertise. While they can't make the decision for you, they can guide you toward a choice that can provide the best outcome. The type of professional you would consult depends on your particular situation.
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​Weight pros & cons list
​We're all familiar with a pros and cons list. Make a list of all the possible benefits and disadvantages of picking one option. Then do the same for the second option. Choice the option with the most benefit with the fewest disadvantages. A weighted pros and cons list upgrades the process by ranking each criterion according to its value to you. The more importance, the more weight an element is given.
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​Heuristics
​A heuristic is a mental shortcut or "rule of thumb" that can lighten the cognitive load. Heuristics are good and bad. They can enable quick decision-making, but can lead to over-simplified decisions that won't account for all available info - which is acceptable for a medium-term decision, but you wouldn't want to rely on for your "tattoo" decisions.
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​We use heuristics all the time because without them, we would have to weigh the costs and benefits of every option. And considering we make thousands of decisions a day, this would quickly become untenable.
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​Here are a few to look out for:

Tattoo Decisions are the BIG decisions with BIG impact and not easily reversed (if you're able to reverse them at all - like having kids). Because of the weight of these decisions, you want to take your time and follow a process. This is where decision making models come in.
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​Rational Decision Making
​This is a multi-step decision-making process that requires you to take a structured and systematic approach to the situation. Depending on the reference source, the entire process is usually five to eight steps. The main premise is a focus on logic and evidence.

Bounded Rationality Decision-Making Model
​The Bounded Rationality Decision-Making Model is also referred to as The Satisficing Decision Making Model. The idea behind this model is understanding that you will come to a result or conclusion that is satisfactory, rather than optimal.  Because as humans operating in a world where we are limited by several factors - like time, access to information, and money - we still need to make the best decision possible.
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​You might find yourself in a situation where satisficing is optimal if you have to move to a new city for a job and your first day of work is coming up quick. In this situation, you probably don’t have time to take trips to the new destination and scope out all the neighborhoods so you make do with virtual tours and endless googling. A satisficing solution may be to rent for the first year in your new location, then make the more permanent house buying decision.

Our rationality is bounded by our knowledge, cognitive capacity, and time limits, so we are being as reasonable as we can within these restraints. This model receives some criticism, but it’s honestly how we make most of our decisions. And at the end of the day, we’re just doing the best we can.

The 6 Thinking Hats
The 6 Thinking Hats, developed by Edward de Bono, is a method of decision-making that approaches decisions from six different perspectives. It divides the issue into clear functions and roles, with each being identified by a colored symbolic "thinking" hat.

It doesn't matter how good your process is, if the foundation you are building on it's sound, the resulting decision will not have the outcome you want. Here are the pieces of your decision-making foundation:

If you haven't taken the time to find your values, what are you waiting for? Values are the guiding light for everything in your life. For more on values, check out Episode 32: Finding Your Personal Values.

While some decisions will only effect you personally, many will involve others. Early in the decision-making process, identify the impact it will have on others. Ask yourself if these people need to be included. Keep in mind, just because they will feel the effect doesn't mean they get a vote. For example, your mom will feel the impact of you moving far away for a better job, but she doesn't necessarily get input. Your partner, on the other hand, especially if you share a household, their participation is needed.

Certain decisions have specific timelines and deadlines. You don't want to miss an opportunity because you spent too much time waffling on a conclusion. Stay mindful of your decision time limits.

Time isn't the only limitation you will bump up against when making decisions. Money is a common limitation, so know what your budget is (if applicable). But even more common is the limit of how much information you can handle. In our modern world, lack of available information is seldom the problem. We now have information overload. You can spend hours pouring over reviews, forums, and articles. Eventually, you will reach a point of diminishing returns and analysis paralysis. Know your limits and stop your research before you hit it.

As you are taking time on the decision-making process, the world is moving on. Things are still happening and life continues. Can't decide to get a haircut or not? Your hair is still growing. Should I get this couch or that couch? Either way, you still have your old couch (or no couch at all). You're giving control to someone or something else. You are letting life happen to you. And that's fine - just acknowledge that you are doing it.

Even with a good foundation and processes, there are influences and limitations on our decision making.

Like heuristics, cognitive biases are mental shortcuts, but they can lead us astray. They are systematic patterns of deviations from the norm or rationality in judgment. Cognitive biases can lead you to make decisions on subjective reasoning rather than logic. Here are a few you may encounter.
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​Anchoring Bias
​Anchoring bias is the reliance on the first piece of information encountered when making decisions, and we interpret any new info using the initial info as a reference point.
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​Scarcity Bias
​Limited time offer! Only 3 left! We encounter this all the time in our consumer-driven world. It's FOMO and loss aversion. We think we have to act now instead of thinking through a decision for the optimal result.
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​Confirmation Bias
​This is the tendency to search for, interpret, and remember information that supports what we already belief.
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​Overconfidence Bias
​The overconfidence bias is also called the Dunning-Kruger Effect. It is the tendency to overestimate your own abilities or the accuracy of your knowledge.
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​Survivorship Bias
​This bias occurs when focusing only on solutions that have generated success in the past. The concept was first coined during World War II when the military was trying to figure out how to best reinforce planes that were returning from battle and reduce losses to enemy fire. They were initially focused on the areas of the plane with the most bullet holes as needing reinforcement. Statistician, Abraham Wald pointed out the flawed thinking. He noted that the returning planes weren't hit in critical areas (duh, because they were able to return). Instead, the reinforced areas should be the parts of the plane with the fewest bullet holes, as these were the most critical and the planes hit there were unable to return.
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​A more salient example in modern times is deciding not to go to college because Mark Zuckerberg dropped out and is a billionaire. But you don't hear about the thousands of people that didn't get a secondary degree and are struggling to make a living.
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​Halo Effect
​The halo effect is when positive experiences with or impressions of one aspect of a possible solution cause you view the entire solution positively - like a coworker's poopy attitude may get dismissed since they produce good work that always meets deadline.
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​Framing Effect
​How a decision is presented can affect the choice made. We are swayed by whether an outcome is framed as a gain or a loss. For example, people are more likely to choose a surgery with a 90% survival rate than a surgery with a 10% mortality rate, even though they are the exact same thing.

We are influenced by those around us - whether it's friends, family, or social media influencers. It can work bidirectionally. We may decide to do something because that's how we were raised, or everyone else is doing it. Or it works in opposition. We resist cultural or social norms and actively fight against them.

The field of behavioral economics studies how our environment plays a role in our decisions. This is sometimes called choice architecture or nudges. It’s when the physical design of a place subtly pushes us toward certain choices. For example, if you want people to take the stairs, then a building can be designed with the stairs clearly out in the open and easy to climb, while the elevator is tucked back in a corner (maybe poorly lit and a little creaky) - which is the opposite of what a lot of buildings to where the elevator is easy to find and you have to hunt for the stairs and you worry if you are going to set off an alarm or get locked out.