A framework for decision making - type 1 and type 2 decisions and RAPID
In his 2015 annual shareholder letter, Amazon CEO Jeff Bezos categorizes decisions into two types: type 1 and type 2. Type 1 decisions are irreversible and have a large impact on your organization/life. Type 2 decisions are reversible and of smaller consequences. You can be quick in making decisions that are type 2. You need to take more time, effort, and focus to make type 1 decisions. One framework of decision-making that can be applied to either decision type is RAPID. Developed by Bain & Company, RAPID breaks down the decision making process into specific responsibilities and individuals:
- R for “recommend”
- A for “agree” (formally agrees to a decision)
- P for “perform” (performs a decision once made)
- I for “input” (provide input for the decision)
- D for “decide” (the person making the final decision)
When addressing a problem, the RAPID framework can be helpful in a team, where a lack of structure may reign over defining a solution to the problem at hand. Defining a D (decision maker) avoids the bureaucratic process of trying to achieve consensus. Consensus is not necessary unless that is a precise policy you may have in your team. The decision-maker is he/she who has the final word on the decision. Every stakeholder’s input is taken into account by a good decision-maker. And the final decision is made by completely letting go of one’s own biases and limiting beliefs. That’s why the RAPID framework is helpful: everyone’s opinion must be truly taken into account—not with manipulative intent, but wholeheartedly and dropping any expectations.
When it comes to deciding on potential routes to take when addressing a problem, the recommender (R) is to not only raise the problem but also define it exactly and propose a solution for it. Then every other stakeholder can chime in to provide their input. Everyone is eradicated from the complacent mindset of “there’s someone else deciding” and fully moved into the mindset of problem-solving. This ensures everyone has skin in the game and truly participates in the decision-making process. That is important because the main value of teamwork is to openly get exposed to ideas from a diverse range of people with varied belief systems and wisdom.
When it comes to personal life, I find it worthwhile to learn the ability to discern between type 1 and type 2 decisions. Most decisions in life are type 2, and such an implicit mental model allows you to move fast. Do you need to decide which restaurant to go to on Thursday night? Merely pick one—that’s not an important decision. You can always pick another restaurant next time if you don’t like this choice. When there is a type 1 decision, instead, you can attentively sense it and can act on it either following the RAPID framework, or by using another decision-making model such as this “Decision Journal”, or the process I defined in this article on problem-solving.
Ultimately, your life is a by-product of the decisions you make on a daily, weekly, monthly, and yearly basis. Decisions compound. Finding a sweet spot between being attentively thoughtful and rapidly agile is key in order to navigating life with a calm mind and body. Knowing when it is best to dig deep and when velocity is necessary is a skill worth pursuing, and I hope this newsletter issue can spark interest within you to dig deeper into the topic.
"Can you imagine yourself in 10 years if, instead of avoiding the things you know you should do, you actually did them every single day? That’s powerful."
Thank you for reading,
Simone