Decision-Making Strategies: How to Evaluate Highly Predictable Outcomes

The first state of ambiguity you might find yourself in is one with highly predictable outcomes.

As we make decisions, there’s always the unknown out there. We face ambiguity in every decision we make. There are four states of ambiguity that you need to appreciate and understand, as you’re trying to make decisions. The first state of ambiguity you might find yourself in is one with highly predictable outcomes.

Let’s imagine I’m going to deal you some cards. I give you the two of clubs, three of clubs, four of clubs, five, six, seven, eight, nine of clubs. If I gave you a hundred dollars to bet on what that next card would be, what are the odds you’re going to pick the 10 of clubs? It’s highly predictable. You don’t need a lot of incremental information to say what’s going to happen next. The next outcome is reasonably easy to forecast. You require little incremental input to eliminate that ambiguity and decisions can be made with fewer parties involved because you don’t need additional information.

Now, let me offer an example of a situation with a highly predictable outcome and how you could react to it. Let’s imagine you have a service and you’re going to make a very small change to a long standing service offering. The source of ambiguity is how are customers going to receive that change? How are they going to react when you make that change? And how many are going to buy that modified service?

What if I told you your customer counts have been stable and predictable for years and that change you’re making is based on an existing and very popular service. You know what’s going to happen in this situation. Now there’s some additional ambiguity you’ll need to resolve. You’ll need to confirm your customer count, but it’s pretty easy to forecast and you may want to do a small focus group to see how that service offering is going to be received once you make those changes.

So again, you don’t need to gather a lot of additional information and you can make the call pretty quickly in a state of ambiguity, where there are highly predictable outcomes.

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