Decision Making Traps

One of the decision making traps a lot of leaders will fall into is when they think they know what the outcome will be before doing the analysis.

Don't make that mistake because it could cost you your reputation and/or significant dollars.

Take the time to go through the decision making process, which in most cases means some type of research. Don't assume anything.

I know many years ago our company was trying to decide whether to switch over to a new product. In our case it was as simple as paper towels.

Keep in mind though we had several facilities so we went through a lot of paper towels each month. Any savings, even if it was a small one on each case we purchased, could translate into a large sum of money.

Currently we were using a very nice absorbent paper towel that cost more than the towel we were considering switching over to.

We made a decision to do a very controlled study of both types of towels over a very specific time frame. The time frame would be a four week period in a large area of the facility where the employee population was fairly constant and could be measured.

We first tracked very specifically the number of current paper towels we placed into service in that area over the four week period. We kept very good track of the employee population by recognizing in numbers only the individuals on vacation and/or sick leave so that we knew how many individuals had utilized the facilities over the controlled time frame.

After we felt comfortable that we kept very good track of the number of paper towels and how many employees had been in the area with an opportunity to utilize the towels, we recorded those numbers.

We changed completely over to the new towel which was considerably less expensive. We did the same exact study and recorded those numbers.

I was absolutely positive we would determine that the less expensive towel would surely end up saving us thousands of dollars over the course of a year.

Well it was a good thing we did the study because as we did our analysis it showed that significantly more of the less expensive towels were used. They were less absorbent which caused people to have to use more. Once they got into the habit of pulling more out automatically, it really didn't matter if they needed them or not. We also determined that they tore much easier so there ended up being more debris on the floor around the waste containers, which was a turn off to our employees. Finally, we also determined that because more towels were used it caused us to have to use more waste liners and increased our waste removal costs. We did not measure this in exact amounts since the cost of just the towels showed that we should stay with our original choice of what we thought was the more expensive towel.

So don't fall into the decision making traps of not doing your research. I'm glad I didn't allow them to just make the change without doing the study first.

Thanks!

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