Business

The Agony of Choice

Written by Lis Meitner

A beagle, admittedly not the cleverest of dogs, loved two things passionately; his food and his human friend. Seeing his dinner and his friend appear at the same time from different directions, he froze: looked back and forth between them for a moment; then raised his head and just howled. Generally people can cope with having a lot more options to choose from, but eventually we reach howling point too; when the number of choices becomes overwhelming and we can’t make any choice at all.

Some people avoid the problem by basing their decisions on just one factor, for example price; although this is often not the only, or even the most important aspect. The chances of making a bad decision this way are high, but if the potential consequences are minimal it doesn’t matter much.

Risk Assessment

But when there is a lot at stake, if we are spending a lot, or stand to lose a lot if we make the wrong choice, we have a strong motivation to spend some time at least trying to arrive at a good decision. This can be particularly important when we are choosing services rather than goods. There can be more variation in the type of services offered and especially in the quality of services delivered. And the potential consequences of a bad decision are often far greater than just the cost of the service.

However if we want something delivered to a customer for example, and Google ‘courier service melbourne’ we get 39 pages with 384 results. We just don’t the have time to look at and assess all of them. To decide how much time we should allocate we need to do at least a basic risk assessment, the more and greater the risks, the more important it is to make a sound decision. If are going to trust a courier with a lot of our valuable goods on an ongoing basis, the risk is far greater than if it’s just a couple of one off parcels. There are a number of potential risks, direct and indirect. If the courier doesn’t turn up on time or the goods aren’t delivered as promised, or are damaged in transit, we risk defaulting on our contract with our customer and of damaging our business reputation. Even if our courier is unprofessional or impolite it will reflect on us.

Risk Minimisation

The risks we identify also help us develop criteria that will minimise or avoid these risks, which helps us narrow our search. Sometimes we look for reviews or referrals, other times we make assumptions based on our own perceptions and experience. We may want a locally based business because we think they will take more care or respond faster. We believe a long established firm will be more reliable. Sometimes it’s just that we are familiar with the name of a firm through their advertising; but hey, if they have the money to advertise, they must be doing something right? Of course we also look at what the firm has to say on their website or in their brochures. Not that we believe everything, but what they say indicates what they think is important as well as providing details of their services.

Types of Decision Makers

Even so the choices may still be daunting; and the less time we have to make the decision and the more choices, the greater the pressure. People tend to towards being one of two types of decision makers, the maximisers and the satisficers. The maximisers are perfectionists wanting to research every choice thoroughly to ensure they make the best decision possible every time. They worry that, whatever choice they make; there might have been a better one. The satisficers on the hand just want to find a service that meets their criteria: they don’t worry that there might be something better. Good is good enough.

Far better to be a satisficer than a maximiser. Maximisers are likely to find making decisions psychologically daunting, often to howling point. Sacrificers are far less stressed and will probably have enough time to make another five decisions before lunch.  And when you consider that the average person makes about 70 decisions a day; at home, in the supermarket and in business…

About the author

Lis Meitner