Good Enough Beats Optimal
When does more analysis start making the decision worse?
The idea
Beyond a point, more analysis costs more than the improvement in the decision is worth.
In the real world
Three more weeks comparing vendors to save 4% on a small contract.
Going deeper
Analysis has a cost and a diminishing return, and the point where further analysis costs more than it improves the decision arrives earlier than most people expect.
The cost is also usually uncounted. Three weeks comparing vendors to save 4% on a small contract consumes several people's attention and delays whatever the vendor was needed for, neither of which appears next to the saving. Setting the criteria and the deadline before starting research is what prevents the analysis expanding to fill the discomfort of deciding.
Where it stops applying
For decisions that are large, irreversible or where the options genuinely differ, extended analysis is correct. The failure is applying uniform effort regardless of stakes.
Why it matters
It makes deliberation itself a cost to be budgeted rather than a virtue to be maximised.
Try this today
Set the deadline and the criteria for your next decision before you start researching.
Test yourself
A team spends three weeks comparing vendors and saves 4% on a £20,000 contract. What did the analysis cost?
Show the answer
£800 saved against three weeks of several people's attention and three weeks of delay in whatever the vendor was needed for. The analysis was competent and the decision to keep analysing was not, because its cost was never compared with its yield.
Learn this in the feed Answering from memory, then again days later, is what makes it stick.