Spreadsheets are a framework for evaluating choices! Which brand of jeans should I buy? Which restaurant should we go? To which colleges should I apply? In our tutorial video and post, let’s discover how to create a model-based decision-making process with spreadsheets!
How do spreadsheets improve decision-making? Spreadsheets provide us with a logical framework from which to base our decisions. The number of choices and criteria can often be overwhelming. Using our spreadsheet framework, we can define a set of relevant criteria and then score each choice by the criteria to select the highest ranked.
More often than not, you may prefer or value one criteria over another. That is, criteria or factors are not equally important to you! For instance, if deciding among backpacks to buy, perhaps the “durability” criteria is more important to you than the “price” criteria. We can easily add a preference factor to our spreadsheet decision-making template before aggregating final scores.
This framework is simple, easy to use, and can lead us well-informed decisions grounded in reason, logic, and soundness.
Should you always follow the decision generated by the framework? Not necessarily! Our gut or intuition need not be ignored. If the outcome from the framework clashes with our instinct or gut, it’s a great idea to then re-evaluate and think about whether certain factors or issues were excluded from our framework.
See this framework live in action in this 3-minute video:
How to create this framework:
To view the spreadsheet, please click here: Decision-Making Spreadsheet. Remember that if you wish to edit it, first save the file on your Google drive.
In building this decision-making spreadsheet, you’ll discover 2 important formulas:
- sum
- sumproduct
Once you understand these functions, you will have the tools to create this decision-making framework.
Sum
Remember that whenever you want to include a formula in a spreadsheet, click on the cell and type in =. After the equal sign, you can then enter in your formula. The sum formula is straightforward. As you’d expect, the sum formula will add up all the data in the cells you reference.
Sumproduct
The sumproduct formula may sound more complex but it is not! It combines 2 simple steps: multiplication and addition. In the example below there are numbers in columns 1 and 2. The first step is to multiply the numbers in columns 1 and 2 (like 1 x 2 in Row 4). Do the same for rows 5 and 7. After you get all the products, add them up, and you’ll get 100!
The sumproduct formula does both steps in 1 swoop. Using the sumproduct formula, first reference the first column, then the second, (e.g. sumproduct (B4:B7, C4:C7)), and you will get same answer as above, 100.
Now it’s your turn! Once you understand the SUM and SUMPRODUCT functions, figure out how to apply them in the decision-making framework!
Did this framework help you out on a decision? How did it work out?