Do you ever find yourself in a quandary when trying to choose between several options? Do you ever make a list of pros and cons to help you decide which path to take in life? Do you ever wish you could be sure you were making objective decisions and not just being driven by emotional preferences?
I use a technique called the decision matrix to help me make important decisions. It’s something I learned and then refined over the years to help me make important business and personal decision like:
- which vacation location to visit
- which candidate to hire for a job
- which job offer to accept
- which apartment to rent
- which software to purchase
- whether to lease or purchase a car
You can use the decision matrix to make any decision you face in your personal or business life. There is no limit to how you can harness the power of the decision matrix other than your own imagination.
This process takes a bit of time, so you won’t want to use it to decide how to spend your free evening. However, if you have an important decision to make and you want to reduce or eliminate the chances of second guessing yourself later, you should give a decision matrix a try.
Note: Now you can view or download a copy of the Make The Perfect Decision Every Time free ebook.
Here are some benefits you can expect from using the decision matrix:
- You understand how and why you choose an option.
- Your decision fits with your priorities.
- You evaluate each option on its own merit without comparing it to other options.
- You use logic rather than emotion to make the decision.
- You get a chance to think about what you really want.
Many people do a list of pros and cons when making decisions. I think that is always a bad idea. Here’s why. When you take the time to make list of the cons for each option, you make a list of the things you don’t want for the option you end up choosing.
I don’t know about you, but I’d rather not fill my head with all of the things I don’t want about the choice I’m about to make. Staying focused on the benefits of each option seems like a smarter and happier way to live.
Decision Matrix Process
The decision matrix process is simple.
- Define your ideal solution. Spend a few minutes thinking about the ideal solution. How does it look and feel? Try it on for size. Make a list of the key characteristics for your ideal solution.
- Set Your Priorities. Which of these characteristics of your ideal solution are the most important? Assign a weight (percent) to each key characteristic. The weight establishes your priorities.
- Assign The Points. Evaluate each option and give it a raw score for each key characteristic. You look at each option by itself and rate it according to how it meets your key characteristics.
- Calculate the weighted scores. Use the raw score and the key characteristic weight (percent) to calculate a weighted score. This combines the facts from your option research with your priorities for the decision to give you an objective measurement.
- Add up the total scores. Add up the weighted scores to get the total score for each option. The option with the highest score is closest to your ideal solution.
The decision matrix can be done on a scrap piece of paper. But because I use this so often, I’ve developed and refined a form that I use to collect the information.
I’m going to walk you through an example using the decision matrix to decide on a family vacation destination. I’ll take you through each process step. To help you out, I’ve attached both a blank form, and one that I’ve filled in for the vacation example for you to follow along. You might want to download them now to follow along with the example.
Step 1: What Is Your Ideal Solution?
Before you can start evaluating options, you have to know what you want. Sometimes, figuring out what you want is the hardest part of making any decision. Give yourself plenty of time for this step. Get a cuppa and a tablet and brainstorm. Jot down your ideas. You can pretty up the list later.
For our vacation example, here are some things you might consider to be the key characteristics of your idea vacation.
- Warm climate
- A beach or other swimming and sunbathing option
- Someplace where they speak English (since you only know English)
- A great cultural experience, not just museums, but different foods and a different lifestyle
- Recommendations from friends or high ratings on review websites rather than going in cold
- Something that fits into your vacation budget
- Kid friendly
- Someplace where the travel isn’t a hassle (because of the kids)
If this isn’t your idea of the perfect vacation, just play along. From this example, you learn how to use the decision matrix for your own decisions using your own choices.
After you make your list, your partner reviews it and suggests a few changes based on her expectations of the ideal vacation. This is the time to compromise and negotiate a solution in very general terms. In the end, your list looks like this:
- A swimming option. An indoor pool is okay, but being at the beach is ideal.
- English is spoken. Or, English-speaking tourists are welcome.
- Rich cultural experience. You want some place that is not like home and not a tourist trap.
- You want recommendations. Information from friends is ideal, but good online ratings are okay.
- Within budget. You have some flexibility, but would prefer to come in under budget this year.
- Kid friendly. Either visit a kid-friendly location or have great kid activities available most days.
- Minimal travel hassle. Less than a day of travel each direction is ideal. You don’t want to be exhausted during the trip or after you get home.
To make the decision process as simple as possible, you should try to keep your list short. Somewhere between five and eight key characteristics is ideal.
Step 2: How Important Is It, Really?
Now that you have agreed on these seven key characteristics, the next step is to assign a weight to each one. This lets you rank the characteristics in order of importance. For this, you use a percentage so that all characteristics add up to 100%.
In this vacation example, you have seven characteristics. If you rated the characteristics as all being of equal importance, they would be weighted at about 15% each (100% divided by 7 characteristics equals about 15%).
This number (15%) gives you a starting point for your weighting process.
Of course, you don’t want to weight each option at 15%. Why not? First, because it adds up to more than 100%. And second, because everything doesn’t have the same priority in your ideal vacation scenario.
You and your partner sit down and discuss how important these are for each of you. Here’s a hint: start with the most important characteristics first.
- You both agree that staying within your budget is the most important thing, so budget gets the largest percentage (weight). If the average weight (in this example) is 15%, you decide that the budget is worth 25%.
- Your second priority characteristics is kid friendly, and that is almost as important as the budget, so you weight it at 20%.
- After some discussion, you decide that a great cultural experience is the next most important, and you weight that at 15% based on the weighting of the other characteristics.
Here’s what you have so far:
1. Budget 25% 2. Kid Friendly 20% 3. Cultural 15%
These characteristics use 60% of your weight, leaving you only 40% to distribute between the remaining four key characteristics. You can adjust the weights at this point if that doesn’t seem like the correct balance.
After some further discussion, you decide on the weighting for the remaining items.
4. Travel 15% 5. English 10% 6. Ratings 10% 7. Swimming 5%
After you complete the weighting, you should review your list and do any fine tuning. These weights drive the process for evaluating your options, so you should be very happy with them before moving on.
Add the weight for each key characteristic in the Key Characteristics Ranking table. Next, fill them in at the top of the Decision Matrix table in weight order (highest percentage first). Again, I’ve done this for you in the example forms.
Step 3: Evaluate Your Options
Roll up your sleeves and get ready to work. In this step, you research each option so you can rate it according to each of your key characteristics. You give each option a rating from 1 to 10 based on how well it meets the characteristic, with 10 being the perfect fit.
In our vacation example, you have some ideas of where you might want to go on your vacation. Some of them may be new places, and others may be places you have already visited. Here’s the short list of possible destinations you have to evaluate:
- Mexico (Rocky Point)
- Santa Fe, New Mexico
- Camping in the Redwoods (California)
You must research each option thoroughly, including costs, travel options, and the other key characteristics you identified.
Before digging in, you know intuitively that Disneyland is going to rate high on kid friendly and very low on cultural experience. It may be the happiest place on Earth, but it is one big tourist trap.
Assign The Points
Think of the ratings as points on a sliding scale. Start with 5 as the average. Decide in advance what the average rating for each characteristic means. This way, you make sure that you evaluate the options fairly and objectively. Don’t be afraid to use the full range of numbers available for rating each characteristic
For example: Average for the budget means that this option costs the amount you budgeted for the vacation.
- Assign 5 points for options that meet your budget.
- Assign 1-4 points for vacations that are over your budget but still doable.
- Assign 6-10 points for vacations that come in under your budget.
After doing your research, you give each of the options the following ratings:
Budget Kids Travel Culture Recom. Eng. Beach 1. Mexico 8 5 10 9 6 5 10 2. Disneyland 5 10 5 3 10 10 10 3. Santa Fe 4 5 4 9 8 10 5 4. Redwoods 6 4 3 7 5 10 10
Compare the numbers for each option in the same category and make any appropriate adjustments. Use these numbers to fill in the raw rating row for each option in the Decision Matrix table. I’ve filled in the example form so you can see how this works.
Step 4: Do The Math
After you have given each option a score for each key characteristic, you are almost done. The last step is to calculate a weighted score for each raw score.
To calculate the weighted score:
- Multiply the raw score (Raw) by the weight (percent) for the key characteristic. This gives you the weighted score.
- Write the weighted score in the weighted (Wt.) score row for the option under the appropriate key characteristic column.
For example: To find the weighted rating for Mexico for budget, you multiple the raw score (8) by the key characteristic weight (25%) and get 200 for the weighted (Wt.) score.
Complete this procedure for all of the raw rating scores in the matrix.
Step 5: Spot The Winner
To find the winner, add up the weighted scores for each option and write it in the Total column. The option with the highest score is closest to your ideal solution.
With all of the math completed, you can easily see which option has the highest score. As many times as I have used this tool, I am always surprised at the results. Applying a bit of logic to the decision-making process always gives a different result than my gut-level emotional choices.
At this time, you can go back and tweak the numbers a bit if they seem unbalanced when you look at the results as a group. You can go back and change the weighting for a key characteristics, or adjust the ratings for individual option characteristics.
The point of this review and possible tweaking is to perfect your weighting and ratings. It’s not a license to cook the books or force the option you want.
If logic selects a different option than your heart, you have a choice to make.
- Are you willing to be open to a different experience that has the potential of being the nearly ideal solutions?
- Are you willing to take the risk to do what you want even though you can see that it isn’t the most logical choice.
Only you can decide that. And no decision matrix will be necessary for that choice.
Decision Matrix Forms
I’ve included two forms for you with this post.
- A blank form (two sided). Use this form to process your own decision matrix for any choice you must make. I’ve granted you a Creative Commons license so you can copy and use this form. There are some limitations to what you can do. Check out the license details for a quick explanation.
- An example decision matrix for the family vacation example. Sometimes, it is easier to see the form filled out than to try to figure out the instructions.
Feel free to use these forms in your personal and business life. I would love to hear your stories about how you used the decision matrix to make a choice in your life, and how you feel about the results.
Added February 20, 2009: You can also view or download the contents of this blog post as an ebook. Make The Perfect Decision Every Time ebook also contains the decision matrix forms listed above.