Decision Frameworks

What this unit covers

Learn two or three real decision frameworks, like weighing how reversible a decision is, or asking what would make it a mistake, for any hard decision.

By the end you will be able to

• Sort a hard decision as reversible or irreversible and match your thinking-effort to it.
• Ask what would have to be true for a decision to be a mistake before acting on it.
• Explain why a decision is judged by its reasoning, not by its outcome.

How it starts: The Call You Cannot Take Back

1. An offer letter asks you to move your savings into a five year plan.
2. You have two days to sign, and 6 lakh rupees gets locked in.
3. You feel sure about it, but what exactly is that feeling based on?

Words you will meet

Reversible decision

A choice that is cheap and quick to undo if it turns out wrong.

Irreversible decision

A choice that is slow, costly, or impossible to undo once made.

In this module: Thinking Like a Professional

1. Decision Frameworks (this unit)
2. First-Principles Thinking
3. Probabilistic Thinking
4. Bayesian Thinking