A friend of mine recently bought a house with her husband. It wasn’t their ideal house. The kitchen and bathroom hadn’t been updated since the seventies.
A friend of mine recently bought a house with her husband. It wasn’t their ideal house. The kitchen and bathroom hadn’t been updated since the seventies. And they weren’t ready yet to make an offer—their old house sat on the market. But they had researched and looked at a couple dozen houses and knew this was a rare opportunity. So they pounced.
We often think of house buying as a multiple choice decision, with all our options laid out in front of us. We weigh and evaluate each option, then pick one to make an offer on.
More often, house buying follows a conveyor belt pattern, with options appearing and disappearing continuously. At any given point, we might only have a handful of options we’re evaluating. But there are always more options on the horizon, or old options we can re-evaluate, if they’re still available.
The decision-making process can go on…forever sometimes. Knowing when to make a decision for a good outcome, or even what a good outcome is, can be tricky.
Read on to learn more about the conveyor belt pattern, dangers to watch out for, and strategies that can help when you find yourself making this type of decision.
The Conveyor Belt
Conveyor belt decisions occur when you have multiple individual decisions spread out over time that represent the same overall decision.
Pick One decisions, where you select one option from a set of choices, can turn into a series of Go/No-Go decisions when your options present themselves over time. Likewise a single Portfolio Selection decision might turn into a series of Portfolio Selection decisions that need to be made in context with one another.
The Conveyor Belt pattern occurs frequently when dating, finding a job, selling a business, buying a house or investing.
Unlike a traditional Pick One decision, where you have a set of static options that don’t change, Conveyor Belt decisions involve options with varying levels of timing, spacing, visibility and uncertainty:
Options stay available for a limited amount of time and the windows of availability for different options can have varying levels of overlap.
Options rarely are evenly spaced, often appearing in clusters with long periods when fewer to no options are available.
Options often exist that you are not aware of, or only have limited information. This creates an information inequality among your options.
Options may appear to be real options, when unknown factors may preclude them being so. Options can disappear for unknown reasons before you get a chance to investigate or choose them.
Learning to understand the timing, spacing, visibility and uncertainty of how options appear to you in a given decision can help you make better decisions.
For instance, the housing market is seasonal, with more options available in the spring and summer than in the winter. In the current market, houses can stay available for months. But in a hot market, you may only have days. Rarely are houses on the market for more than a year. Conversely, in dating, people can easily be available for years, while others get snatched up immediately.
When buying a house, visibility tends to be high, since MLS sites list most of the houses on the market in a given area (but not all—so doing additional research into For Sale By Owner can increase your options). In dating, visibility is low. From dozens of bars to dozens of dating sites to people who hang out at neither of these, being able to see all your options at once never happens (which can be frustrating or encouraging, depending on your perspective).
Types of Options
Think of your options as items on a conveyor belt. Some exist directly in front of you, some you’ve chosen to let pass on, while others roll toward you. The ones coming toward you may be close, so you can see their details, far away, or even hidden in the next room.
These options can be grouped roughly into:
Options no longer under consideration. These may be options you discarded, that others took or that simply expired.
Options under active consideration that you have the ability to choose right now.
Potential options that may become an active option soon. Near options often require only a little time or effort to become an active option and you have detailed information about the option.
Potential options that you are aware of, but are not near options. Distant options often require more time or effort to become an active option and you have only vague information about the option.
Potential options that you are not aware of.
As you move from past to unknown options, visibility lessens and uncertainty increases. Generally, the closer the option is to you, the more you know about the option and the less chance the option will disappear or cease to be an option for you.
As an example of these types, imagine you are searching for a job. Your job options can be classified into:
|Unknown||Jobs not yet posted or that haven’t come up in your search|
|Distant||Posted jobs you’ve seen, but you haven’t applied to yet|
|Near||Posted jobs you’ve seen and applied to|
|Current||Jobs you have an active offer for|
|Past||Jobs you turned down or decided not to apply to|
Now that we know the attributes that affect a Conveyor Belt decision and the types of options to look for, let’s look at some of the pitfalls to watch out for when making these decisions.
When making a decision, we strive to obtain the best possible outcome. Or, at least, a good outcome.
With a Pick One decision, where you have a fixed set of options, you can have a high confidence once you’ve made your decision that you picked the right option. Often you can take your time to weigh all the factors to make an informed, balanced decision.
With a Conveyor Belt decision, you have no such luxury. There are always more options to choose from and your options are often time-limited. This introduces several pitfalls into the process.
- Phantom Options
Dreaming up options which do not, or cannot, exist. Imagining what unknown options may exist can be a useful way to broaden your focus. But don’t let your ideal option become the standard by which every other option gets measured–especially when your ideal option doesn’t exist outside your head.
- Shiny New Options
New options have an allure older options lack. A new option can make us forget our criteria and rationalize why it’s the best option. Don’t forget old options were new once too. Treat new options with extra care and aim to have objective criteria that can tell you if an option truly is great.
- Waiting Too Long
A consequence of phantom options is that people aim for their ideal option and overlook good, and even great, options. They let these options pass by until decision fatigue kicks in. Then they either avoid the decision entirely, or make a decision when their option pool is limited.
- Acting Too Soon
Others make a decision immediately, out of fear that no good new options will appear or because they don’t have a yardstick yet to figure out what a good option looks like.
- Decision Fatigue
Making decisions takes mental energy. Make too many of them and you deplete this energy, causing you to make decisions irrationally and impulsively. Because the conveyor belt involves a lots of individual decisions, instead of one big one, it’s easy to get fatigued.
These pitfalls all come from valid ways of making a Conveyor Belt decision.
To make an effective Conveyor Belt decision, consider employing some of these strategies.
Research the Space
Develop an understanding of the timing, spacing and visibility parameters of your decision.
Ask others who have experience in the area you are making your decision what these parameters look like, or examine historical data, if available.
Calibrate Your Criteria
Knowing whether an option is bad, good, great or off-the-charts freaking amazing can be difficult when you start out and have only seen one or two options.
To develop a good yardstick, start out looking at a large number of options and talk to others to understand their yardsticks, keeping in mind that what’s important to others may not be important to you and vice versus.
Aim to understand what determines if an option is bad, good, great or ideal. Jump on options between great and ideal, and seriously consider all options between good and great.
The faster you can calibrate what a good option looks like, the better chance you have of making a good decision.
Prioritize Your Criteria
As part of your calibration process, prioritize what’s important to you and what isn’t. Rarely will you find your ideal option, so you need to know what compromises make sense to you.
Aim to understand which criteria are critical, important, minor or insignificant. Don’t merely rank your criteria, compare them against each other to determine their relative priorities. Consider using a process like paired comparison to determine a weight for each criteria.
Expand Your Options
Increase your number of options in two ways: find new sources and mine your existing sources better.
Search for other option sources. Buying a house? Check out For Sale By Owner web sites in addition to MLS sites. Dating? Check out other dating web sites other than the one you’re on. Or expand beyond online dating entirely and explore an activity club or dating service.
Question your assumptions about what qualifies as an option to discover new sources. Instead of buying a house, what about buying land and building, buying a houseboat or renting instead? Loosen your criteria to see if other options may be appealing.
Learn to search your existing sources more effectively. Try new search criteria or techniques. Looking for an employee? Besides posting your job in various places, consider varying your job title or description.
The more options you see, the better you can calibrate and make a good decision.
Change the Timing of Options
Try to convert the multiple decisions within the Conveyor Belt process into a single decision by backlogging, accelerating, and timing your options.
Create a backlog of potential near options that you can quickly convert to current options. When selling a business, research buyers, but wait to approach them until you can approach several at once. This increases the chance you’ll be looking at multiple offers simultaneously.
Do extra work to move options along the conveyor belt faster. Try to uncover as many unknown options as you can quickly, then take action to bring those options closer to being current options.
Constrain Your Options
Real constraints, like the amount of money you have, can constrain your options. Constraints act as filters to help you find a reasonable set of options faster. Fewer options give you time to research and gain greater visibility into those options.
Consider putting artificial constraints on your options . Set a deadline or impose specific criteria for your options. Search in only certain markets initially.
Even if you eventually expand your search, setting initial constraints makes the task of finding options more manageable, and allows you to gain a deeper understanding of those options. That deeper understanding helps you to more quickly evaluate new options as you expand your search.
Certain market-based decisions, such as those where options get taken off the market once selected by others, present most of their options when you first start evaluating the decision. Examples of this include buying a house, finding a job and registering for a new dating site.
When you first start the decision process, you can evaluate all the options on the market, both older and newer ones. Once in the process, you will tend to only evaluate new options that didn’t exist when you started your process. The quantity of new options appearing can be significantly lower than the quantity of all open options in any given market.
Don’t make a quick decision thoughtlessly, but be aware that the quantity of your options tends to be greatest when first entering a market. This can skew your idea of the chance of getting a great or ideal option, and cause you to delay your decision looking for a better option. Better options do appear, but often not at the rate you anticipate.
The Conveyor Belt pattern introduces additional complexity into the decision-making process. Decisions that may look like simple Pick One multiple choice decisions, may actually be Conveyor Belt decisions that require more thought and consideration.
When you find yourself in a Conveyor Belt pattern, be aware of the pitfalls and apply the above strategies to improve your decision.
Finally, avoid waiting for the ideal option. With Conveyor Belt decisions, you will never know if you’ve picked the best option, as there are always more options coming down the line. Aim to pick a good or great option, not the best.
What decisions have you encountered that follow the Conveyor Belt pattern and how have you approached those decisions?
Credits: The photo used in this article was taken by YL Tan.