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Building a Toolbox of Decision-Making

Recently I was introduced to the idea of the Cynefin Framework. It’s a concept used to aid decision-making, and was created by Dave Snowden who used to work for IBM. I’m still learning and processing the idea, but I find it immensely interesting as it applies to decision making - financially related and in other realms. 

I think what intrigues me the most is the fact that each circumstance or decision requires us first to try and establish a “domain” the circumstance is happening in which we need to think and act (or act and think) through. 

A Simple domain has a clear relationship between cause and effect. Do This, expect That. Generally the connection is somewhat linear and limited in potential outcomes. Advice in this space is to sense > categorize > respond. 

A Complicated domain still has a clear-ish relationship between cause and effect, but there are a range of potential outcomes or effects that may require some diagnosing or decision-tree exploring. Advice in this space is to sense > analyze > respond. 

A Complex domain is less clear, and oftentimes the relationship between cause and effect can’t be known until after they are examined in retrospect. Only analyzing won’t lead to a lot of progress, and so often we have to take small actions to explore their effect. Advice in this space is to probe > sense > respond

A Chaotic domain is even more unclear regarding cause and effect, and sometimes the relationship between the two isn’t fully known even in retrospect. Too many variables cannot be known or analyzed before acting, and so the advice is to act > sense > respond. 

What’s so fascinating to me about this is how it provides a toolbox of sorts to make good decisions - financially, relationally, economically, etc. It’s tempting to apply the Simple domain to everything, but the reality is it’s not always that easy. It’s also tempting to think we can always analyze enough to the point of knowing precisely what we need to do, but the reality is sometimes we have to take action first. 

The old saying of “if you only have a hammer, everything looks like a nail” comes to mind. But if we instead build our decision-making toolbox out with these different frameworks, we can end up making better decisions. 

Interesting Resources

Quote
Proverbs (10:8, ESV)
"Do not reprove a scoffer, or he will hate you;
reprove a wise man, and he will love you."


Today vs Tomorrowland
5 min read | CalibratingCapital (me) 
I wrote this over a year ago, and it remains probably my personal favorite piece I've written. I think about this balance between Today and Tomorrow almost on a daily basis, and although I don't maintain the balance perfectly, I feel I've made a ton of progress. I recently reread it, and at the risk of total self-promotion, might encourage you to do the same. 
Hopefully the decision of you reading this week's Fident Friday was a Simple one, and that its own cause-effect relationship is obvious. And even more, I hope that it at least introduces, in a rudimentary way,  the idea of applying these different domains to making decisions in your own life. 

Gratefully,
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