I’m Dr. Hassan, a Board-Certified Physiatrist and Independent Practice Owner. I help physiatrists start and grow their own profitable practices so they can achieve financial independence and live without limits.
When building a profitable practice, you must learn to make decisions quickly, and you must develop a system to effectively make the right decisions. Decision trees can help you make the right decisions. Decision trees are tools used by people to help them make competent decisions. It helps them lay out several alternatives in a tree-like format. They can see most, if not all, the decisions available and can even set a rating on each choice.
The concept of a decision tree is an extension of a mind map.
A mind map lets you create ideas and connect those ideas. The decision tree is much like this concept, but there is a score added to the branches of the tree. The scores often represent probabilities. If you have three choices, you may assign two branches with 40% probabilities and the third branch would receive a 20% probability. The total of the branches should add up to 100%. However, it is your decision tree, so you are free to use whatever allocations you like, if any. If your system makes sense to you, then it is correct.
Some project managers use decision trees to determine the cost of projects. When they assign probabilities to branches, they’ll multiply the total budget by the probability. For instance, if a branch has a probability of 35%, and the total budget is $100,000, the branch will be estimated to cost $35,000 (35% times $100,000).
Decision trees don’t have to be this intricate to be useful. You can use them to list out the alternatives for a decision and end your efforts there. You could also choose to update the percentage of completion for the path that you select. Again, there are no right answers when using the decision tree for your purposes.
When others rely on your decision tree, and you are formally calling it a decision tree, you may need to follow the protocol of assigning probabilities and figuring out the percentage cost. However, if the group agrees to other conventions, then again, that is the right answer for the group. A decision tree is simply a way to convey information to yourself or a team.
Decision trees will have a certain amount of subjectivity associated with them.
In most cases, coming up with probabilities is quite subjective. It’s only through experience that you’ll be able to refine probabilities. If the project you are working on is a one-time deal, you won’t get the benefit of refining those probabilities and will have to start over with a new set of subjective probabilities on the next project. However, some branches may carry over to the new project and you’ll have a better feel for what to assign to those.
I am Dr. Hassan, a Board-Certified Physiatrist and Independent Practice Owner. I help physiatrists start and grow their own independent practice so that they can achieve financial independence and live without limits. Please go to businessofrehab.com\contractnegotiations to pick up the free guide to help you negotiate the contract of your dreams.
Making decisions requires critical thinking skills. Check out our blog here for ways to strengthen your critical thinking and save more time when making decisions.
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