February 21, 2013

SLT 016: Making Decisions Like a Fighter Pilot & Frugal vs. Cheap

52 minutes

Making Decisions Like a Fighter Pilot & Frugal vs. Cheap

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Dan’s Topic: The OODA Loop

Our Decisions, Our Future

You’ll recall that the 5 pillars we focus on for OUR simple life together are Faith, Family, Finances, Fitness and Future

Well, our Future is determined every single day by decisions that we make

We make decisions all the time…daily in fact…most of them without any effort whatsoever

But isn’t it funny how simple these “automatic” decisions are when other decisions lead us to hours, days, and sometimes months or years of contemplation and struggle and hemming and hawing?

Introducing the OODA Loop

Today I want to talk about decision-making and a very simple framework that you can use to help with your decision-making

This process is called the OODA Loop, as in O-O-D-A

OODA stands for Observe-Orient-Decide and Act. The OODA Loop is a recurring decision-making process…a cycle, if necessary…developed by Col John Boyd, who was a fighter pilot and later a Pentagon consultant after he retired. Col Boyd is also credited with being the key planner for Operation DESERT STORM

While Boyd’s OODA loop concept began in fighter pilot circles, its also pretty popular in other combat ops units, too. It’s become so popular, in fact, that it has since spread to the civilian word…becoming popular in business, sports, and becoming quite popular with attorneys in the litigation process

So, if you’ve never heard of the OODA loop before and are wondering how this little tool can help simplify your life…well, I’m here to share that with you.

What’s the Scoop on the OODA Loop?

The premise of the OODA Loop is that through a recurring cycle of OBSERVE-ORIENT-DECIDE-ACT you can “get inside” an opponent’s decision making cycle and gain the advantage.

But it’s not solely for use against what would traditionally be called “opponents”. In business, competitors would be a more appropriate term than “opponent’ or “enemy” and even more generically, in life, “situations” can be our opponent when we’re trying to achieve our goals.

And, well, we all know that clutter and complexity are our enemy, so I cover how the OODA loop can help you out there, too!

So, with the OODA Loop, if you can get through the observe-orient-decide-act cycle quicker than your opponent or faster than the situation unfolds, you’ll come out on top!

So, let’s break it down…

OODA Loop Phases

First, let’s talk about the phases of the OODA Loop

The first step is OBSERVE. Essentially, this is when you notice a situation that is a potential problem. It’s simple, you see something, you observe it. No judgements are made in this phase.

The next step is ORIENT. This phase is the biggie…this is where your entire past comes into play. We have to put what we’re seeing into a context so we can later make a decision. In the ORIENT phase, we use our hard-wired instincts, intuition, our history, our knowledge, our experience, new information, split-second analysis…even our mental predictions of what the outcome or impact of potential decisions could be…all to orient ourselves as to what we’re observing

Once we’ve OBSERVED and ORIENTED, we can then DECIDE. We make decisions every day, and when we do, our decisions aren’t just based on the current situation, as I just mentioned in the ORIENT phase, they’re based on everything we’ve soaked in over our lifetime. But our decisions are often limited to a reasonable, limited set of choices. We’ll get to that in a moment.

So…now it comes time to ACT. Acting is just following through with your decision. Simple as that.

But the OODA loop process doesn’t stop there. Remember, it’s a loop so it can be repeated over and over again until there’s a final outcome. Of course, in Colonel Boyd’s model, this would likely take place at altitude with two pilots dogfighting until one of them is the victor. In my former world it takes place on the ground as you and you enemy fire and maneuver until one no longer returns fire. Each step in these battle scenarios requires another cycle through the OODA Loop.

OK…So Here’s an Example

In your world, the OODA loop may help you as you battle your clutter or as you fight your consumeristic tendencies.

Let’s say you’re doing the Edit & Forget It Challenge and you’re going through a storage area. With each item, you can use the OODA loop to help your tackle the whole job.

With each item you’ll go throughout the phases…

Observe: OK, here’s a widget

Orient: Do I need this, have I used this, do I love this, can I see myself needing this soon, what will I do if I don’t have it, can I borrow it…etc

Decide: Keep it or not. If not, what am I going to do with it? KEEP-TOSS-RECYCLE-DONATE-TRASH (each one of these may require it’s own OODA loop

Act: Follow through! Don’t make the mistake of waiting!

oo-oo-oo you know what that is?

How Can I Use the OODA Loop?

Remember…this is a decision making framework. You can use this for decision making of almost any kind, not just in battle or in editing…in almost anything!

Use OODA Loop on your Inbox, when shopping, buying a new car

We have a good friend John over at LetsReverseObesity.com whose goal is to control the forces that allow him to overeat…anyone trying to change behavior or start a new habit will meet challenges and obstacles along the way

Each one of those is a decision point…and having a decision-making framework can help you make decisions that are aligned with your goals

The OODA loop can easily become a nearly instantaneous cycle or you can use it to make more detailed deliberate decisions

Don’t Forget the End State!

So, armed with your news OODA loop, let’s get back to where I started when I said “our Future is determined every day by decisions we make”

If you’re a regular listener, and we hope you are, then like us you’re on a journey to simplify your life

And hopefully you’ve taken some time to really reflect on your life plan…what you want your life to look like down the road

We always talk about the “desired end state” or what you want things to look like in the end as the best place to start out.

Imagine starting out on a long road trip without a destination in mind. It’s kind of hard to plan things out, isn’t it? Why take that chance with your life?

The reason I bring all this back up is that if “our Future is determined every day by decisions we make” then we need to keep that desired future in mind when we go through our decision making process. So, in the OODA loop, our desired end state should certainly be a consideration when during the ORIENT and DECIDE phases.

Just like your personal values and morals shape your decisions, so too should plans for your future as they’ll be directly effected by those decisions

Final Thoughts

So, give the OODA loop a shot and see if it works for you

Maybe having your goals well thought out, and a solid framework in place will lead you further down the path on your journey with a few less stumbling points along the way

So, give the OODA loop a shot and let us know how it works out for you!

Vanessa’s Topic: Being Frugal vs. Being Cheap

A couple of weeks ago I was with a group of women and the subject of makeup and the best facial skin care products came up. One of the gals said the best lipstick was made by Chanel. When I asked her how much it cost she said $38…with other lipsticks up to $50! I was like….that’s nearly half my electric bill for this month! I can get 3-5 decent lipsticks for the price of one!

I was shocked at the price because I just can’t justify (personally) spending that kind of money for lipstick. Probably because I came from humble beginnings and was never really exposed to high-end/designer labels and such. Let me just say…just because I don’t shop high-end designer labels, doesn’t mean I don’t care about how I look or about quality. I do! But just on a budget.

The whole situation got me to thinking…do I sound like I’m being cheap? Do my friends and colleagues think I’m cheap because I don’t have designer sunglasses, handbags, or shoes? Do my clients judge me? Well I decided to jump on the internet to see if I could answer the question: “Am I being frugal…or am I being cheap?”

As I sifted through the various articles I found a few that for me, clearly explained the difference, so I thought I would highlight some of the better explanations and examples of what I found….because I think it’s bound to be a question or topic that comes up with this type of lifestyle that we are living or striving to live.

Definitions of Being Frugal and Being Cheap. Here are a couple of definitions I found on a couple of different sites:

“Frugality is in the center of the money spectrum, between cheapness and extravagance. Like most good things, frugality taken to either extreme is not a good thing. It is the wise and intentional use of money whether saving or spending.” (from Life Renewed)

“Being cheap is a reluctance to spend money, even on things that are necessary and needed. Cheapness is selfishness and often results from fear; fear of running out of money and not being able to take care of yourself and your family. Cheapness is only concerned about spending the least amount of money possible” (from Life Renewed)

“Cheap people care about the cost of something; frugal people care about the value of something.” (from AskMen.com)

Examples of Being Cheap vs Being Frugal (From Life Renewed):

“Cheap is buying stuff on sale just because it’s probably the best or only time to get this item at such a cheap price….Frugal is buying only what is needed, wanted and by researching the best deal.”

“Cheap is buying the cheapest food (restaurants or grocery stores) without any care for quality or nutrition…Frugal considers cost of food but with regard to quality and health benefits.”

“Cheap is not tipping at restaurants or not paying your share of the tip on a group ticket…Frugal budgets for eating out which includes tax and tip.”

“Cheap is suffering living in a hot or cold house because you don’t want to spend too much on the utilities…Frugal finds the right temperature that is economical and within a budget and not wasteful.”

“Cheap is lying about your kids’ age to get a discount…Frugal is planning and budgeting outings with your family that consider the costs of such outings.”

Examples and Thoughts on Frugal vs Cheap from Mr. Money Moustache:

“It’s all in your head….many of the worst spending addicts do so because of their imaginary fantasies about social status.”

“Frugal doesn’t mean owning mostly crap. Cheap people will keep things like old appliances even though they are not efficient, energy efficient or even safe. They just don’t want to buy new. A frugal person will buy a newer one product because it’ll probably save time and energy.”

“Frugal doesn’t mean you don’t spend on yourself.” You should still enjoy a date night here and there with your spouse…treat friends or family to dinner every now and again…get a massage every once in a while….just don’t become a pamper-me addict!

Example from Choosing Voluntary Simplicity:

“Frugality has become almost synonymous with deprivation and denial and understandably, this kind of negative frugality turns most people off….when frugality is base on your own values and what You want out of life, it can only be a positive influence. It’s not about spending less money…how you choose to spend your time and how you choose to conserve other resources should all be part of the total equation.”

Frugality…What’s It All Worth?

“It is balancing your needs and wants of today with those needs and wants of tomorrow…it is not a destination but a journey.” (Life Renewed)

I totally agree with this! I say all the time that it’s ok to spend money on things you need and even want…as long as it’s deliberate, thoughtful and won’t hurt you or interfere with your long-term goals. It’s the spending every dime you have the second you get it with no regard for your future…or saving every dime you have and not enjoying a damn thing in life….that’s what will get you in trouble or living a life of regret.

My Thoughts:

Being frugal helps you to have a better understanding of, appreciation for and relationship with your money. Being frugal usually means that you’ll have a better understanding of what “living within your means” really means…with benefits of avoiding debt, avoiding bad purchases, avoiding foreclosures, etc.

It helps you to analyze, and focus on your “important goals and priorities.”

I also think that when you’re frugal..you usually end up with more time and means to do things you really want to do…not just living paycheck to paycheck. It can allow you to allocate those resources (time and money) to other causes or priorities….donating to charities…giving your time to help others…etc.

Yet again, we come to an idea or concept that isn’t “cookie-cutter” perfect. Frugality is different for everyone. But after reading these articles and many ideas on the topic I’ve come to conclude that the idea of being frugal is a concept of being in control, being more mindful, and being deliberate so that you can live a life on purpose…without the pressure of trying to achieve what society or mainstream America defines as success. It’s about living in the moment (responsibly of course) and also looking forward to the good things that lay ahead. It’s not about being selfish, stingy or living in fear. It’s all about defining life on your own terms and securing your freedom to live a life with meaning.

The “Thing” Segment:

Dan’s Thing: The GOOD-FAST-CHEAP Conundrum

I’ve noticed in life that products you need typically only meet 2 of the 3 criteria on the FAST-GOOD-CHEAP model.

You can have Good/Fast: Usually that’s usually an expensive option…so be prepared to pay

You can have it Good/Cheap: But typically not available within your timeframe…so planning is a must

The worst products typically fall into the Fast/Cheap category: They usually also end up as a “clutter producing” option…or are the result of an “impulse buy”

The best way to avoid the FAST-GOOD-CHEAP conundrum? Identify your true needs, do some research, and plan in advance.

Vanessa: Brene Brown’s book: Daring Greatly.

In the book she was talking about practicing courage and facing our shame and vulnerabilities…in particular she was describing a moment where she experienced shame and that her advice to people who experience the same thing is to “own the story ” and not bury it. She quoted Carl Jung (famous psychotherapist) who said, “I am not what has happened to me. I am what I choose to become.” I thought that was so powerful because too often we let shame control and silence us. By owning your pain, and admitting your vulnerabilities, somehow you become stronger. Highly recommend anything by Brene Brown…I’m a total fan!

Edit & Forget It Update!

Lots of new folks to the Facebook Edit & Forget It page this past week! So if you signed up for Edit & Forget It, join the fun over on FB, too! It’s never too late to join the Challenge, it’s going on all year so if you’re ready to edit 2013 things from your life, head on over to SimpleLifeTogether.com and sign up!

A special shout out to Former President George Bush for his support in the video he did for the Edit & Forget It Challenge Facebook page. Regardless of your politics toward the former Prez, it’s nice to know he supports our efforts at Simplificatin’.

Feedback:

Thanks so much from the following for leaving such amazing feedback!:

Lisa Johnson, Mohamed Tohami from midwaysimplicity.com, NicJames, Tawny_lynne, Angora from the UK, Mark from London, UK, Eren from Brazil, Erin who heard us on Joel Zaslofsky’s podcast Smart and Simple Matters, which you can also find on iTunes or at ValueOfSimple.com.

Wanted to thank everyone that has given us fantastic feedback on iTunes, thru email, on the website and even several “shout outs” on different blogs and podcasts. It’s great to hear how you enjoy the podcast and to get your ideas and suggestions for future ones as well. Thank you so much!

Closing Thoughts:

We’re blessed to be able to share some ideas and some of our experiences as we journey toward a simpler life in the modern world and we’d like to hear some of your experiences, too.

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Connect with us on Twitter, Dan is @DanielHayes and Vanessa is @GetSimplifized. You can find links to our Twitter and Google Plus profiles on the left side of the home page.

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Here are the links we mentioned in the show:

Life Renewed

AskMen

Mr. Money Moustache

Choosing Voluntary Simplicity

Brene Brown

...more

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By Dan Hayes & Vanessa Hayes, Daniel Hayes

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