The 40-70 Rule

Boy oh boy, have I loved making hasty decisions. Impulse control is one of my lowest EQ traits, but over time I’ve adopted (stolen) better tools for decision-making. While there are plenty of mental models for HOW to make decisions, there are very few for WHEN to make decisions.  

I know little to nothing about geopolitics, but I know that if you’re the US Secretary of State, you’ve got to make a lot of decisions, and those decisions have considerable implications tied to them. Colin Powell said he had an equation for when to make a decision…

Part I: “Use the formula P=40 to 70, in which P stands for the probability of success and the numbers indicate the percentage of information acquired.” 

Part II: “Once the information is in the 40% to 70% range, go with your gut.”

Making a hasty decision with less than 40% of the total info is more likely to result in an unfavorable outcome. Waiting until you have more than 70% of the information, means that the decision is more likely to be made for you by someone/something else.

So then, how the H do I feel comfortable making a decision before having 70% of the info?

If its in my wheelhouse of experience, then I rely on the trust instilled from Blink (Malcolm Gladwell), on the power of the adaptive unconscious, and trusting yourself to make decisions in a seemingly short time frame, especially when your brain has hundreds/thousands of prior situations to call upon subconsciously.

I love it when smart people echo the same advice, just phrased in different ways. My gut says to trust these guys and make decisions this way.

Colton is the chief strategist at FoxFuel and makes both good and bad decisions. At this stage, most of his good decisions are business related, and 90% of his bad decisions are fashion related.