Making Better Decisions


In our last post we talked about the Sunk Cost Fallacy and how we, as decision makers, sometimes have a propensity for using the wrong information to power our choices. We thought it would be prudent to offer some ideas on how to overcome these obstacles. Not just for your home improvement business, but for your everyday life as well.

To be clear, The Sunk Cost Fallacy is only one of a host of other mental hurdles that get in the way of your decision-making daily.

What we’ve found to help guard against all these mental hurdles is: don’t go it alone. Teams are important. Having different points of view with which to find solutions is really the key to solving any problem…including your business problems.


Dissenters Wanted

Empowering your team members to voice opposition to proposed changes (or the status-quo) is probably one of the best ways to hedge against opening yourself up to the risk of falling prey to something like the Sunk Cost Fallacy. Your “team” is probably bigger than you are thinking. Don’t just consider business partners and managers, but also your sales people and project managers in the field. They see where the rubber meets the road and can warn you when there is a systemic problem in the business. We know what you’re thinking, “The sales team always complains! I don’t want to sit through all the whining.” Even if that is the case, let them complain. On a basic level you are giving them the opportunity to work through a frustrating situation and making them feel heard. But listen closely, if you hear similarities from multiple people, and some management, you may be able to identify a fixable problem in your system.

Remember, when you actively suppress people’s divergent opinions, you are training your staff to never speak up when they see a potential issue. Suppressing ideas can be anything from actively berating someone for an idea to passively blowing it off. Different people tend to look at a problem from different angles. They may see an issue you aren’t considering.

One way you can model HEALTHY dissent is to vocalize your own hang-ups over a certain issue. This would empower your employees to voice their own opinions. It turns out, many people hold back their feelings of doubt because they feel like they are the only ones WITH that doubt. Everyone else then takes the resulting silence to mean that everyone agrees. This could end in a decision being made that NO-ONE believes in. This is called Pluralistic Ignorance.


Every Train Needs a Good Track                                                       

home improvement softwareAlong with promoting group input on decisions, it is also important to set strict rules on how decisions are made. Lay out the criteria that need to be met and set rules on how to judge that criteria. This will essentially serve as a constitution for your own company. A set of rules that can be followed in every decision; to make sure the right choices are being made.

This can be tricky though. Sometimes looking at your teams’ input in different ways, can net you different results.


After demoing a new software platform for your home improvement business, a 3-member team sits down to figure out if they want to stay with their current system or switch to the new one. So, they set the two criteria that must be met to make the switch.

  1. Does the current technology require further investment?
  2. Is the new technology likely to improve the company?

For the member’s vote to be a yes, they MUST answer yes to both criteria. The team members vote.


As you can see, depending on how you count the votes, your decision changes. If you tally by employee, the decision is to stay with the old platform, since most of the votes were no. (Remember, the answer to both criterion had to be a “YES” for the final vote to be a “yes” for the employee). However, when you look at the individual answers by criteria, you would most likely go with the new system.

The point is, choosing how you will read the results of your teams’ input is key to how your decisions will be made. In the graph above, the difference is what will be weighted more – The employee or the criteria. The bigger your company gets, the more important this becomes, as the more voices there will be to be heard.

There are so many things to consider when making decisions for your remodeling company. The important part is to know yourself, and the biases you bring with you when you come into a new situation. Also, to surround yourself with people you trust, so you never have to worry about whether you’ve considered all the possibilities. None of this will completely eliminate the risk inherent in any decision. However, it will set you up for your best opportunity for success!