Learning to make effective decisions is a competence and requires practice. The art of decision making is to accept that there will be an opportunity cost attached to it. It is about choices and given the resources we have; we make the choice that is best at the time. Therefore, it is important that we make a well thought out decision. Decisions once made are many times difficult to reverse and therefore, it is important to evaluate all our options well before making one.
The decisions that we make could range from simple ones like going to see a movie with friends during the week or buying that fancy pair of new shoes or playing a video game. Every decision that we make comes with an opportunity cost. For example, instead of playing a video game, the time could have been used with family, or for exercise or for reading etc. All those activities that could have been done but were not done is the opportunity cost of the decision that was made in favor of playing the video game.
But all decisions that we take during the day do not really matter. Like where to buy coffee from or where to sit at lunch time in the school refectory because the consequences of these decisions are not critical. But some decisions can have a lasting effect for years. These are critical decisions.
The two significant factors that may need to be considered when making a decision, specially the critical ones are time and money and therefore, keeping these factors in mind when making decisions will always be helpful.
When in high school the one critical decision that all students face is to decide which college offer to accept. Or, which all colleges to apply to for admissions.
One way to help make good thought out decisions is to use the right mental models. The decision-making model PACED can be one model that may support you in making a well thought out decision. But do remember that not all decisions need the same model.
Let us unpackage the model PACED
P– Define the Problem
Why do you need to make this choice? Write down the problem statement.
A– List the Alternatives
What all possible options do you have? Write down all the alternatives that you are considering in individual columns.
C– Determine the Criteria
What are the things that are important to you? Write down all the criteria that you are considering for evaluating the alternatives.
E– Evaluate the Alternatives
How does each alternative meet each of the criteria?
You can evaluate the alternatives by adding a plus (+) or minus (-) sign in the cell and then totaling to see which alternative comes out stronger.
D– Make the Decision
Which option has the most favorable trade-offs? Whatever be the decision, the other options available will be the opportunity cost of selecting an option.
As students plan the selection of their college in high school, using PACED model could be helpful in making a responsible and informed decision.
An Exemplar (only some possible criteria have been considered to explain the strategy)
Problem: Deciding which college to attend
|Name of Colleges (Alternatives)|
|Criteria||College A||College B||College C||College D|
|Size (in terms of student numbers or space. I have taken size for small student numbers)||–||–||+||+|
|Sum of all criteria for all alternatives||4||4||3||4|
|College A, B and D both meet some of my requirements and have scored the highest. But as academic offerings and career services is of paramount importance to me, I will go in favor of College A.|
Victor Franklyn in his book, Man’s Search for Meaning, states that how one chooses to react to a situation can never be taken away from the person whatever be his situation. He goes on to say that even in despair and when there is nothing left the one thing that a person has control on is the decision that they make on how to react to a stimulus.
Therefore, decide well and own your outcome.