The Four Types of Decisions

Some members of our team (me included) were recently stuck on a decision, and that led to us getting stuck in a discussion vortex. After a couple weeks, we found ourselves scrambling to choose a path in the face of a looming deadline. We got it resolved, but that kerfuffle reminded me that there are always only four types of decisions.

From less to more involvement of team members, those decision types are:

1. Command – leader takes charge, asking no questions and just directing (mainly used in crisis);
2. Consultative – decision maker gets individual feedback from team members, then makes a decision;
3. Collaborative – team has a discussion, after which decision maker makes the call; and
4. Consensus – everyone has to agree or majority wins. This is only used for things like where to go to lunch.

90% of decisions are either #2 or #3. #1 through #3 require decision maker to be named before launching into the process.

Staying mindful of the four types is empowering for everyone who participates. When we aren’t mindful of which type of decision we’re making, frustrations can emerge. For example, people might think something is a consensus-driven decision, but others actually understand that it is really collaborative. Then people become upset because the decision maker simply made a decision without calling for a vote or without consensus being reached. But when we are mindful of the decision type, each person knows their role to play, and instead of trying to get their desired outcome, they are more apt to focus on fulfilling their role (giving thoughtful counsel).

Trust and a clear understanding of who is ultimately making the decision are big requirements for us to make good decisions and for everyone to feel good about the process. The participants need to trust the decision maker’s judgment, and also trust that the decision maker will thoughtfully consider their input.

Within a trusting team, choosing a decision maker is almost always easier than reaching agreement.

Thanks to Craig Johnson for introducing me to this idea.

Identifying our beach head

In GuildQuality’s earliest days, virtually all of our prospective customers came from my personal network of homebuilders, remodelers, and real estate developers. That network carried us to a couple dozen customers and enabled us to flesh out a real product that solved real problems and created real opportunities for quality-minded contractors. From there, we had to figure out how to expand.

Our first meaningful market expansion opportunity came via a referral from one of our earliest customers. They suggested we get in touch with a company that organized roundtables and provided consulting services for more than 100 design-build remodelers all over North America. 100+ companies may not seem like a lot, but it just so happened that these remodelers were among the most respected remodelers out there. Our relationship with this new network not only helped us to quickly expand beyond my 1st degree network, but it also helped establish GuildQuality as the type of service that exceptional companies choose to work with.

Not long after that, we developed similar relationships with organizations that introduced us to networks of homebuilders and neighborhood developers, and our customer base grew to nearly a couple hundred remodelers, builders, and developers. Around then, we began asking ourselves: What does a great GuildQuality member look like?

By “great”, we meant, “Who, when they learn about GuildQuality, is most likely to sign up pretty quickly?”

We settled on three characteristics:

1) They were a member of a network within which we had some reasonable penetration. This meant that they were likely to know at least a little about us, especially with networks that had a formal relationship with GuildQuality and who helped to market us to their membership. Building product manufacturers’ preferred contractor programs are the most common example of this sort of network.

2) They were in a geographic market where we had at least a few very reputable customers. This meant that they almost certainly had heard of (and respected) some of our customers, and were more inclined to give a salesperson the time of day.

3) They were the type of company that was interested in technology solutions that could help them improve their business. Back then, this meant that they had a website, though today that standard has risen a good bit.

We found that if they matched any one of those three characteristics, there was a decent chance that they’d sign up. Two out of three meant a very good chance. Three out of three meant they would almost certainly sign up.

We used those three characteristics as our beach head, and spent almost all of our sales and marketing efforts targeting companies that matched at least two out of three.

To this day, those three characteristics are still excellent indicators of whether or not a company will be interested in our service. And as our membership has grown, our networks have grown, and the percentage of contractors who are investing in technology solutions has grown. That means there are now considerably more companies who are hanging out on our beach head.

The cutting room floor

A couple months ago, GuildQuality introduced a new service that helps homeowners or prospective homebuyers find a builder, remodeler, or home improvement contractor. Internally, we’ve been referring to it as Find.

This is a pretty big expansion from our core bread-and-butter service of customer surveying for contractors. Since 2003, the best contractors in North America have relied on our surveying to help them deliver great service. When we launched way back when, we focused solely on surveying homeowners and homebuyers on behalf of builders and remodelers. We quickly found that our information was useful to anyone interesting in learning more about the great companies we work with. So that led to us in 2004 to introduce company profile pages for our members. Over the years, we added more and more to those pages: pictures of work, social media integrations, public reviews. Etc. etc.

We realized that there were byproducts from serving our GuildQuality members that we could repurpose in new and valuable ways. We created member profile pages after we realized that we had a ton of feedback that, if repackaged, was really useful for the prospective clients of our members. We introduced reviews after we realized that we were already going to the effort of prompting a customer to share their feedback in our surveys, and we could easily give them the chance to share a review as well.

Now, years later, we find ourselves with tons and tons of great information from both homeowners and contractors from all over the United States and Canada. We have enough that we can now share powerful information about who’s doing what sort of work in which locations. If you’re in Seattle and need a new home or renovation, we can help. If you’re interested in finding a Charleston remodeler, we’ve got you covered. If you’d like to replace some windows in your Bethesda home, we know who you need to speak with.

We’re really excited about Find. Check it out, and don’t hesitate to share your feedback.

What are your byproducts? What assets are you developing that you’re not leveraging? What are the sorts of things that you’re leaving on the cutting room floor?

P.S. Here are some more ideas about using your byproducts from the folks at 37signals, circa 2009.