Comparing upsides and downsides

4x4 diagram showing bubbles A to E with different mixes of upside and downside

A time of change forces us to get better at taking decisions based on little information and without knowing how things are going to turn out.

One way to do this is by finding more opportunities and choosing what most inspires us. Another is to apply our purpose and values. And a third is to learn from our past, our future, and from people we admire.

If none of these bring clarity we can also use a final, more analytical approach.

To apply this, first make a short list of the few preferred options that you are trying to choose between.

Then remind yourself of the key factors that are shaping the context of your decision. These might be thing like:

  • Why does this issue matter, compared with your other priorities?
  • Who are the key stakeholders (including yourself)?
  • What will most inspire you/them
  • What do you/they most want to avoid?
  • When do you need to take a decision by?
  • How quickly does a solution need to be implemented?
  • How long does the solution need to last and how robust does it need to be to changing circumstances?
  • What resources are appropriate and available?

The balance between these competing priorities will shape what is the best option for you. It might not be the ‘perfect’ outcome you might hope for but it will be the best option available. And it will enable you to move forward.

Now examine each of your preferred options in turn:

  • What are the Upsides of this option, the benefits and advantages it might bring?
    (Rank them as “very high, high, low, or very low”)
  • How likely or achievable are these and how easy will they be to implement?
    (Rank this as easy (green), difficult (red), or medium (amber).)
  • What are the Downsides of this option, the disadvantages and difficulties it might bring?
    (Rank them as “very high, high, low, or very low”)
  • How likely are these to happen and how easy are they to avoid or mitigate?
    (Rank this as easy to avoid/mitigate (green), difficult to avoid/mitigate (red), or medium (amber).)

By this stage you may already have decided which option you prefer.

If not, map out your preferred few options on a grid like the one above. This will force you to get clear on why one option has more Upsides or more Downsides than another. (And if you’ve already made your decision it will bring you a deeper understanding of why you’ve chosen that option.)

 

There are no right answers apart from what is best for you:

In the example shown above I chose Option B, even though it was the most difficult to implement. This was because it brought me the biggest Upsides and the smallest Downsides, and that was what I wanted at the time. I was willing to take the risks to get the potential benefits.

This matches Elon Musk’s attitude to risk. He says:

“When something is important enough, you do it even if the odds are not in your favor.”

But there are no rules here — the best option for you depends on your situation and your attitude to risk. (This is why it is important to review the ‘context’ questions first.)

In a time of change all ways forward will be difficult. Thinking through the Upsides and Downsides is yet another way to find the best way forward for you and to make yourself and the people around you antifragile.

Are you currently choosing between alternative ways forward? Do you have a shortlist of your best options? Have you thought through the Upsides and Downsides of each?


Adapted from Inner Leadership: a framework and tools for building inspiration in times of change.

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(And remember: you don’t learn to swim by reading about swimming, you also need to practice.)

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