When you think about it, every single decision you make is, in a way, a gamble.
Stepping out to cross the road, could mean you get run over by a bus, if you made a good decision based on how you have judged distance or speed of the vehicle. Deciding to take out a loan to buy a house could be a major problem if you lose your job.
This article isn’t meant to scare you, but simply to let make you aware that there is a degree of risk in every decision we make. We simply cannot control every factor involved.
So, what do you do when you have to make decisions in situations where you know that the risks are high?
It could be that you lack sufficient information.
It could be that you are making decisions in a chaotic or volatile situation.
Whatever the case may be, there are some risk-mitigating strategies you can use to help you make smarter high-risk decisions.
The next time you have to make a decision where the outcome is vague, apply the following methods:
Make Uncertainty work in your Favour
In cases where you lack sufficient information, make a list of what you don’t know rather than what you do. This is a counterintuitive but brilliant approach.
We think we need to be certain about specific facts when we make decisions. But sometimes, analysing the uncertainties can lead to better decision-making.
You can make uncertainty work for you by weighing up the unknowns and deciding how seriously they will affect the outcome – you may be surprised to find that the impact is less serious than you thought and that the risk is worth taking.
Think Process rather than Outcome
Assessing outcomes does matter, but what really makes for a smart decision is the process.
This process should include assessing our own knowledge, consulting others if necessary, on working with both the knowns and the unknowns.
This makes for a quality decision, which is basically the best you can do in risky situations.
Even if the outcome is undesired, it doesn’t mean the decision was wrong.
Having a through process and focusing on that rather than just the outcome gives you the confidence to make decisions that are more or less a toss-up.
Consult with Others
Don’t hesitate to consult with others and even confess your doubts and uncertainties. Never try to be ‘right’ all the time. In risky situations, this is a recipe for disaster.
When you consult with others, lay out all the facts but don’t state the outcomes you have reached.
Instead, let them formulate their own outcomes and see if they agree with your own.
Honest communication and collective brainstorming lead to more thoughtful and effective decision-making.
Put in Perspective
Ask yourself what the impact of the decision will be in 5 weeks, 5 months and in 5 years.
This is the best way to put it into perspective and more importantly, give you an indication of how much room you have for risk. Think through the scenarios in each of the three cases.
If a decision will lose its impact in 5 weeks, then there is certainly more room to gamble. If it will still impact in 5 years, you need to spend more time on it and decide if the gamble is worth taking.
We can argue that in today’s fast-paced unpredictable world, making decisions has become harder – and in many cases, riskier.
Making thoughtful, effective decisions when the outcomes are vague is challenging but making these types of decisions is an inevitable part of life.
Use the strategies discussed here and when you practice them often enough, you will learn to see decision-making as an opportunity to test your skills, knowledge and self- confidence.
More importantly, they are an opportunity to gain experience and learn invaluable lessons.
- Make uncertainty work in your favour
- Think process rather than outcome
- Consult with others
- Put in perspective
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