People love the rewards of being rich but want to skip the process of getting there. When people talk about decision-making, most people only focus on what is the best result? Or, how do we get the best result? However, people usually do not pay much attention to their processes to get there. Appropriate decision-making is the veracious route to attain your goals. So, what is a good decision-maker and what is a poor one? Making good decisions consistently involves choosing options that have the best chances of leading to favorable outcomes. Instead of just relying on your intuition, applying a rational decision-making model can be more effective.
So, what is the rational model of decision-making? It is a rational model of decision-making that uses logical steps to select the best possible solution. In short, it means that before you decide to do a great thing, you should analyze multiple alternatives and use credible data or facts to choose among options. Rational decision-making is a precise process when you have time to research solutions and discuss the possible outcomes with your partners. It aims to maximize the benefits and minimize the costs of decisions by being objective.
Now, let's talk about each step of the rational decision-making.
Step 1.
The first step is to identify the problem. This is a tricky one because once you set the wrong topic or you actually don't know what exactly your problem is, you will fail and trap yourself in the darkness that doesn't even exist. For example, suppose that you want to purchase your first house. And, you identify your first step is to where should I live? Or, what kind of house should I purchase? However, the correct topic is to identify whether you actually need to buy a house or not.
Step 2.
When you actually need to buy a house, the next step is to understand which factors are important to you. How many members will live with you? Where do you want to live? Which location is suitable? How's the climate? Crediable constructors? You probably only have a certain amount of money saved, and you don’t want to take on too much debt, so price range is an important factor as well.
Step 3.
Now, you have listed many factors you care about. The next step is to figure out which factor is much more important for you than others. If each factor is equally important, then there is no need to weigh them. For example, if you truly care about the weather over how big your house should be, the rank of the weather is higher than a big house at the location which is frequently in bad weather. It is similar to writing down a to-do list with a priority order.
Step 4.
In the step 4, which is also the tricky one, requires you to generate ALL alternatives about your options. But, how do you know you have listed all the possible options? Moreover, it is also time-consuming. Therefore, ensure you do have much time for this process.
Step 5.
Now, you have many options on your hands and you have to evaluate each alternative against the criteria you have established. You are now considering each house's pros and cons.
Step 6.
Okay, it is time to make the choice and pick up the best alternative.
Step 7.
Then, you implement the decision. You go out and sign the contract to own it.
Step 8.
After you have owned it, you are now evaluating the outcome of your previous decision. Why? Because it will influence the next decision you made. You probably think that it is the final choice you made on purchasing a house. But, who knows? Many people own two or more houses during their lifetime.
Conclusion
Overall, I think one of the key differences between a rational decision and a regular one is that although there are still many feelings involved in a rational decision, it still takes time to consider more options rather than just impulse buying and purely relying on emotion. Poor decision-makers often make decisions while they are getting emotional. Another common problem that occurs frequently on poor decision-makers is they often identify the topic incorrectly. For example, they FEEL they need a car and then jump into the step two to consider which one they should buy. However, they probably do not even need a car at all in the first place. Good decision-makers must identify their issues correctly.
Reference
Chi, C. (2018, July 18). Rational decision making: The 7-step process for making logical decisions. HubSpot Blog. Retrieved March 4, 2022, from https://blog.hubspot.com/marketing/rational-decision-making
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