How to Make the Best Decisions for Your Career
What's worth more to you: a huge signing bonus with a West Coast firm or being close to your family in New Jersey? Is taking a job near your high school sweetheart worth a lower salary?
It's nearing the time of year when college seniors are weighing these types of questions, and the decisions that are made are as much a product of what's going on between your ears as with what's hanging in the balance. How you use your head-the process you follow to actually make a decision-is often overlooked in the rush to make up your mind before it's too late.
Even before the "what were they thinking?" investment choices that led to the global economic downturn in 2008, there was an impetus toward looking at how decisions are made in the business world-and how to make better ones. Applying some of the models from the field of decision science, which combines elements of statistics, psychology, and economics, can shine a light on your own career decision-making process, and hopefully help you improve your approach.
The decisions we make have a profound impact on our lives. As Ralph L. Keeney, co-author of Smart Choices and research professor of decision sciences at Duke University's Fuqua School of Business, says, making decisions is "the only way, as an individual, that you can have any purposeful influence on your life."
And few decisions are tougher to make than those that pertain to your career. Why? Well, the career decisions you make will have an impact on your family, your love life, the clothes you wear, and the place you call home, and vice versa. Yet we put little effort into honing the process.
In his book, Keeney puts forth a systematic approach to arriving at good decisions. While analysts in other fields take a normative or descriptive approach, decision analysts such as Keeney promote a prescriptive one. Rather than cataloging how people actually make decisions-an area of focus for social psychology and behavioral economics-prescriptive analysis posits how both individuals and organizations should make decisions. This comes down to minimizing poor alternatives and maximizing good alternatives.
From the prescriptive analysis point of view, decision making is the same for individuals as it is for organizations-and many big companies have a department devoted to decision analysis and risk management, assessing the possible outcomes of all their big decisions. Individuals, though, have their own insights to guide-we call it common sense. "People have been making decisions for thousands of years, and they were as good at making decisions thousands of years ago as they are today," says Keeney.
Common sense, then, is the key to making a rational decision. And a rational decision is one that Keeney defines as consistent with your values based on the information available. "The reason to make a decision is to achieve something. It's not just for the existence of a job. You could go down to McDonald's and get a job."
Break it Down
In Smart Choices, Keeney outlines the PrOACT model of decision making: identifying the problem, specifying fundamental objectives, creating a range of alternatives, understanding the consequences of each one, and looking at the tradeoffs between the alternatives. This approach to decision making can be applied when seeking a job to more clearly assess the situation and get where you want to go.
The first step of identifying the real problem in the decision-making process can often elude job seekers. "I think a lot of them frame this as a search process, not a decision process," says Keeney. "They let other people control the alternatives they consider. They don't back away and say, 'What job would I really like?'" Rather than asking "Should I take this position?" job seekers should frame the "decision problem" differently: "Where will my work be valued?" or "Where can I best put my skills to use?"
Most students have no problem grasping their objectives: pay, quality of life, proximity to family and friends. And some short-term objectives might take a back seat to more long-term considerations: the ability to make a contribution in your work, to keep learning, to have good colleagues, and overall job satisfaction.
After clearly identifying your objectives, the path is clear to explore different alternatives. For an IT engineering major, this might include working for an established firm (Infosys or Cisco, for example), a small business, a brand new startup, the government or a nonprofit, or even enrolling in graduate school. It could even mean off-the-radar choices such as setting up computer networks for schools in Africa. Any alternative that could help meet your objectives is on the table at this point.
From there, though, you have to consider the consequences of all the different alternatives. Relocation costs and living expenses in a new city become factors at this stage. Or maybe you should consider start time: Will a firm need you the day after graduation, or months later, in the fall? Will you have time to visit the city and search for apartments first? Just as the alternatives were numerous, it's important to try to rein in the possible consequences by listing them.
According to Lindsey Pollak, a career consultant for Millennial job seekers and author of Getting from College to Career, students today are finding this step difficult. What she is seeing is fear-an almost-debilitating uncertainty in the face of making career decisions, and the worry of making the wrong choice and having to live with the consequences. "This is a generation that's had a lot of attention from parents, teachers, tutors, and guidance counselors. They haven't had to make a lot of decisions."
One client of Pollak's was torn between an offer from a Fortune 500 company and a position with Teach for America. After accepting the offer from the prestigious firm but before starting work, he decided he couldn't live with the potential consequences; he changed his mind, backed out, and went with Teach for America. Pollak says the student worked harder than anyone she has seen, interviewing company employees and current TFA members, but a better process could have saved him that painstaking, intermediate step.
Add It Up
With all the alternatives and consequences in mind, how can you decide between them? It's a matter of making value trade-offs, the tricky balancing act in which you have to try to quantify scenarios such as what it's worth to be close to your family or being in a city with an active nightlife.
Comparing personal relationships to salary may seem like a matter of apples to oranges; however, business students have to make this kind of calculation all the time. Matthew Bailey, assistant professor of business operations and analytics at Bucknell University's School of Management, employs these value balance exercises in his classes, as well as in his advisory role outside of the classroom. "They have a set of skills that can be applied to any decision they go through. Benefit versus risk is a big thing they're going to see when they get their jobs."
For both classroom exercises and his students' real-word decisions, Bailey frequently tells them to "quantify what you can"-salary, insurance and other benefits, cost of living, transportation-and then to weigh the difference between alternatives based on those terms. Students may not be able to put a price on being close to their families, but they can tell from a balance sheet of the quantifiable factors whether it's worth, say, $3,000 in pay. "They might not know what it's worth to them," Bailey says, "but they can say, 'I know it's worth more than this.'"
Even after these first five crucial steps of the PrOACt process, there's plenty more to consider. As the decision-maker, you must still clarify the relevant uncertainties of your decision, figure out the risks involved, and how much risk you're willing to accept. Questions about job stability may come into play here: For example, if you're going to work for a startup, could it go belly up in less than a year? If yes, then it's probably not worth the trade-off of a $5,000 higher salary.
Or you may need to consider the implications of interrelated decisions, such as the effect of an initial job choice on long-term career trajectory-weighing how an initial job choice could prepare you for another position later on. After all, today's economy isn't producing lifetime employees; more workers have multiple jobs in their first five years out of school than ever.
The economy is limping along, reducing the number of available jobs and changing the way companies decide to hire, but Keeney's emphasis on common sense endures. He feels the PrOACT model from Smart Choices is as valuable now as it was ten years ago-pre-dotcom crash and pre-subprime mortgage crisis. "Your personal values may change, but the fact that a decision comes from your personal values is not going to change."
The key is to step back, break down the decision process, and use your noggin.