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Friday, November 7, 2014

Why we should choose to have less choice

[Also available as a podcast]

Everyone likes to have choice

No, that's not quite correct. These days people demand choice, especially in the arena of consumer goods and services.

The more choice the better, it would seem - or at least the manufacturers would have you think so, as you try to pick out a new cell phone from the hundreds of similar models available on any given day. 


But the truth is we don't handle choice all that well. Choice means change and uncertainty - and offering too much choice can literally stop you in your tracks - or make you leave the shop dazed and confused, without buying anything.

Let's look at another example - a common product consumed by millions every day, to which many seem utterly addicted.

Of course, I am talking about coffee.

Up until the late 1970's / early 1980's in North America, there was just coffee. Plain old coffee with a few, limited choices - filtered, or percolated. You could add milk (homogenized, 2% or skim), full cream, or just black - and a few lumps of sweetener if you preferred (sugar, honey, or artificial sweetener).

Somehow, people managed to get by - for hundreds of years - with simple coffee choices. However, if you think about it, there was actually a lot of choice to work with.

2 brewing styles
5 liquid mix type options
3 sweetener type options
= (2 x 5 x 3) = 30 basic combinations to satisfy your caffeine cravings.

Well, of course it was not really that simple. You also needed to consider quantities - large, medium or small coffee, how much milk, and don't forget whitener powders - and how many spoons or sachets of sweetener. Oh, and don't forget the different types of coffee beans, and a few flavored coffee beans.

Suddenly, you could easily have 300-400 different combinations that somehow need to be filtered through before you finally get your cup of coffee.

It's enough to make you quite anxious - so you'd better have a coffee to settle those nerves.  Agh!

However, we all managed pretty well with that level of caffeine choice. Because once you had tried a few variants, you generally found one you liked, and most people stuck with that. Suddenly, there was no more "choice" when you ordered coffee - you selected your preferred combination, and all would be well until they ran out of one of your ingredients, and you had to make do with 2% instead of full cream. For many, it was an unsettling event, because they had to make a new choice, and choice meant change.

Getting that old cup of coffee was pretty quick too - someone usually had a pot on a warming plate, and a waitress would come and 'warm up your cup', then you carried on your conversation while sipping your plain, old fashioned cheap cup of coffee.

Because plain and cheap it was - and frankly, pretty horrible compared to much of today's coffee.

Thank goodness for the widespread adoption of expresso-based coffee - it definitely changed our lives. But aside from the huge increase in price and upward trend in quality, was it really for the better?

A Better Cup

Today, the pace of change has us rushing around trying to do more things with less (and less time) than we have ever experienced before. We are expected to produce our outputs faster - and so in turn, we expect those who serve us to be faster too.

That might be fine except for one big problem.

At the same time that more demands are being placed on everyone, everyone also wants to have more choice while they are at it. We want it all, in seventeen color options, twelve sizes to choose from - and we want it to be the best quality, the cheapest price and we want it delivered this afternoon, between 3:45 and 4:05pm (otherwise the delivery will be free, it says so on the sign).


Or at least, we think we want that much choice.

Think back to your projects for a minute. Are you more successful in getting a change request approved when you provide the project sponsor twenty-seven different options and costs - or when you offer them only two or three options to choose from?

It must be twenty-seven options, right? Because we all want as much choice as possible.


Your sponsor does not want to work that hard - they simply don't have the time to review all of the combinations, because they have other priorities and projects to attend to. So they leave the meeting in disgust, confused about all of the options, and uncertain about your ability to lead the project. Not a great outcome.

So what do you do? You sift through those twenty seven options, rationalize them at the project team level, apply some stringent criteria, a dash of cost-benefit analysis, and you manage to whittle the list of potential options down to two or three (but no more than four). Better yet, as you reduced the set of options, you also spent more time discussing and documenting the various costs, benefits, risks and other factors that apply to each option.

So the next time you meet with the project sponsor (giving them ample reading time ahead of the meeting), you sit down with them, discuss the smaller set of options, and the pros and cons of each. The sponsor quickly makes a decision, and signs off the request. They leave the meeting ten minutes early with a smile, because that's just enough time to get a nice coffee from the cafe on the corner before their next meeting.

More choices cause anxiety, stress and uncertainty - because most people simply can't handle a large number of options very well at all. We want it simple, and we want the decision to be easy.


Not only does too much choice cause anxiety and stress, it also wastes a lot of time. Think of all the time you stood staring at the shelf when you were shopping for an item that had a lot of choices available. You would take one box off the shelf, stare at it, read the details, then pick a similar looking box off the shelf. You would study that one, hesitate, put one of them back, then pick an other. Thirty or forty minutes later, you have only managed to move a few steps along the aisle, and are no closer to making a decision. Twenty-three more options left to consider.

"But wait," you say - "The more choice there is, the longer it takes to consider the options. That's just straight math. And you don't want to make a bad choice!"

Well true, but how do you know if you will actually make the best choice anyway? Plus, standing there for so long just makes a person thirsty. Time for another coffee.


Years ago I was in Houston, heading off to the customer office with three colleagues. It was a bit of a ritual to stop and get a good expresso coffee on the way to a customer site; especially as the coffee was covered under your daily meal expense limit. Otherwise it was too expensive to have every day.

We were running a few minutes behind, but the driver pulled into the drive-through lane of a popular expresso coffee chain anyway, driven to have that quality caffeine fix. The line of vehicles moved very slowly, which made us more and more anxious as we realized we were going to be late - the question now was by how much.

"They are so sloooow," one colleague complained.

"It would have been faster to go in," commented another.

"What's taking so long?" asked the driver, banging one hand on the steering wheel.

Finally, we got up to the window, and I realized the nature of the problem as my colleagues placed their orders.

"Grande Trim Half-Caf Mochachino, two sugars and a twist of lemon."

"Vente Caramel machiatto, triple shot, full foam, with the caramel swirl on the top."

"Vente triple shot americano, whipped cream on top and three sugars on the side."

Then it was my turn.

"Vente. Hazelnut. Latte" I quickly rattled off, then turned to my colleagues.

"You know, the reason the line takes so long is because coffee orders like yours are so complicated. It's your fault!"

They were not impressed, but I had learned something important.

Sometimes too much choice can be a bad thing. This is especially true when the customer is upset you are late, and even more so because you wasted that extra time getting your fancy coffee.  As the meeting starts, they sit glaring at you, sipping the filtered office coffee they had made especially for you. Not the best way to start the first day of meetings with a new customer.

The Simple Choice

A year later, I was in Memphis working for another end client. My colleagues who had been working there for a while took me out for dinner and to see the sights. We wandered into the famous Peabody Hotel, which is well known for its house ducks who live on the roof. Every day they are escorted down the elevator, then waddle out onto the red carpet and over to the fountain in the lobby. They spend a good portion of the day paddling about in the fountain, and then in the late afternoon, they hop out of the fountain, and follow the bellman back into the elevator, and back up to their other home on the roof. 

I never managed to be there at the right time to see the ducks, but I loved hearing the story.

As we exited the lobby, we crossed the street and began walking down a poorly lit alley. I had worked with these people for several years, so I was not overly concerned, but something did not feel right walking down an alley in Memphis in the evening. Memphis was known at the time to have some violent neighborhoods, and I didn't know enough to tell if we were going into one. So I held back, just a bit.

But my colleagues walked on, motioning me past the second dumpster, and down a brick stairwell. We entered a very crowded BBQ restaurant called the Rendezvous, and politely made our way through the crowd to the hostess desk. Within a few minutes, we were escorted on a winding trail through the restaurant, then seated at a large table. The place was packed full, with barely enough room to pull the chairs back from the table. 

As soon as we were seated, a brusque older waiter pushed between the tables and put a loaf of cut white bread on the plastic red-and-white checkered table cloth. He pulled out a pen and a pad of paper from his apron pocket, and sized up the table.

"Sweet or unsweet?" he asked.

He was talking about iced tea. Each person quickly replied with their selection. Someone tried to order a Coke and he just glared at them. 

"Um, sweet, I guess," they stammered. He nodded.

Then he pointed his pen at each person around the table. 

"You'll have one pound of ribs. You- big guy, pound and a half at least. You - one pound. You - two pounds. You - one pound," and so on as he worked around the table.

"Wet or dry?" he asked, pointing his pen at me.

"What?" I asked, not knowing what he meant.

The colleague to my left whispered "BBQ Sauce on your ribs, or dry rubbed spices. Choose dry."

"Um, Dry please," I said, then the others made their selection.

He nodded, and tucked the pen back into his apron. "Be out with the corn bread shortly."

And that was it. A full meal ordered - and we only made two small choices each. The rest were made for us - and we were not even allowed to choose a different type of drink. At first, I was a bit annoyed - but as dinner arrived and I worked my way through the best rack of ribs I have ever had in my life, I decided it didn't matter.

Just like the scenario with the sponsor of your project, sometimes having limited choice is the best thing for you.


Choice is a double-edged sword. If you have too few options, you won't be confident that you are choosing the right thing - you may feel you are missing something important. But too many choices can quickly deadlock your thinking process, as you get bogged down in confusing and often conflicting details.

The key is to reduce the dizzying number of options down to a manageable few - as soon as  it is practical to do so. A shop keeper who provides too many options risks losing sales, just as a shop with only one or two options for an item might lose out to a competitor with a couple more product choices. 

In many situations, simplifying the options comes down to trust. When you research a larger group of potential options and reduce those down to a manageable number for your sponsor to review, they should be confident that you have done your research, and have discarded many of the less appealing or impractical options in a sensible fashion. As you present the clear pros and cons of the remaining options, it makes their decision-making that much easier, and their trust and respect for you will likely grow as well. 

However, if you did not do a good job of providing a reasonable (defensible) set of final options for your sponsor to consider, they may not trust your judgement the next time.

In day to day life, we really don't need that many choices. What is the big difference between all those different cellphone models, anyway? Will you use all of those features? Probably not. Just pick the blue one and be done with it - you will save at least an hour you could be spending eating ribs.

Or maybe you just want to sit down, unwind and have your vente half-caf machiatto with a caramel swirl on top.

Hey, not all choice is bad!

Our waiter in the Rendezvous was actually quite famous - the "grumpy waiter" was well known in the city, and I was glad to have been served by him. He passed away a few years later - a loss to the city, but I am sure the ribs are still just as good.

Good luck with your projects, and if you ever make it to Memphis, make sure to go to the Rendezvous restaurant. I recommend sweet and dry - and that may be the only choice you need to make!

Email: Gary Nelson, PMP

Sunday, November 2, 2014

A Practical Case Study in Cost-Benefit Analysis - did you want Popcorn with that?

[Also available as a podcast]

Cost-Benefit Analysis

A process by which you weigh expected costs against expected benefits to determine the best (or most profitable) course of action.

A few years ago I was at a customer site in Independence, Missouri. It is a classic American town, sitting on the eastern edge of Kansas City. One of the advantages of working for a company with a wide-spread customer base was that I had the opportunity to visit a lot of different places.

When money has been spent to get you there, you had better make the most of it - so you maximize the hours you spend with the customer. However, when the working day is done there is an opportunity for personal benefit and exploration as well. So wherever I went, I made sure to learn about the local history and try to see a few attractions.

It's all about maximizing the value for the cost - which is the primary basis for cost-benefit analysis. In this case, the personal cost was not financial, but in time away from family - so it was worth my while to see the sights that I could in the time that I had. Especially when somebody else had already paid to get me there.

With a population of 119,000 Independence is more like a small city, but they have preserved their identity and character despite the closeness to their larger next door neighbor, Kansas City (pop 467,000). It's just what you might expect from a town called Independence.

Although I was only there for a few days, I made the most of my visit and thoroughly enjoyed having a look around the place while I was there. Few attractions were open after working hours, but I did manage to fit in a tour of the Harry S. Truman national historic site before it closed for the day. It was a nice southern-style building - not huge, not opulent - but it was a good, solid building with nice architectural features.

Source: Wikipedia (cc) Nationalparks

In fact, it was his family home. We were only allowed to tour the downstairs, as Bess Truman wrote into her will that in order to protect her family's privacy, the second floor was to remain closed until the death of her daughter, Margaret. Though Margaret died in 2008, the second floor has remained closed in order to better preserve the home.

For a President who took America from its traditional isolationism into the age of international involvement, it was a sign of his firm connection with his roots that he and his family lived in this same comfortable house since his marriage in 1919 until his wife Bess died in 1982. Having visited a number of other presidential national historic sites, this was the one that I liked the most. Unlike the imposing columns and the expansive property of Mount Vernon, this felt like somewhere a real person lived - not someone larger than life.

The next evening, I finished work too late to see any other historic sites, so I decided to see a movie. At least, that was the plan.

I'd like a ticket, please

Someone at the office had recommended a theatre that was a short drive away in Overland Park. There were closer theatres, and it was about a half hour drive, but they said it would be worth it.

So off I went, picking up a sub sandwich on the way. I still had it in the bag when I arrived at the theatre - I wanted to make sure I would be there early enough to get a ticket and the movie was starting in an hour. The way the person at the office had talked it up, I was a bit concerned about a full house.

I parked, locked the car and walked up toward the ticket window of the Rio Theatre. It was a building with an art-deco style facade, with plenty of neon lights wrapping around the sign board showing the name of the movie.

Image source:
When I reached the ticket window, a young man smiled at me through the glass.

"Can I help you?"

"I'd like to but a ticket for the 7:00 movie, please."

"That'll be eight dollars."

I opened my wallet and handed him a twenty. He passed back a ticket and twelve dollars in change.

I was tucking the change into my wallet when he said "Um, we need three more."

"What?" I asked, looking at first at my wallet, then back at him.

"We need three more people before we can open the door."

I looked to the side and saw eight people waiting in their cars. The parking lot was otherwise empty. "Why?"

The young man sighed. "We need at least twelve people or it costs more in electricity to run the projector than we take in ticket sales."

"Huh," I said.

"If we don't get enough, we will refund you," he half-smiled. "Don't go far."

"Okay..." I said, as I turned and walked back towards my car. I looked at the other people sitting in their cars. A couple glanced in my direction.

I went back to my car and unwrapped my dinner. As I ate, I watched the ticket window. About fifteen minutes later I was finishing up my sub as four more people arrived. They seemed to study the playbills off to the side of the ticket window for a long time.

Come on, come on, I thought, checking my watch.

Finally, they walked up to the ticket window. Money was exchanged, tickets were handed over and five car doors opened.

The art deco theme continued inside. I bought some refreshments and went inside the theatre itself and took a seat near the back. It was well appointed, with hidden lighting along the walls. There was open floor space along the sides, and I sat in a spacious dark brushed velvet seat as I took in the art-deco framed rich velvet curtains at the front. It wasn't over-done, and you could easily imagine people dressed to the nines coming in for an evening's entertainment of moving pictures. I looked all around the theatre while the lights were still on, taking it all in.

I was almost disappointed when the lights dimmed for the movie.

 Image source:

An hour and a half or so later the movie finished and the lights came back on. The movie itself was OK, but being able to experience the obvious care and attention to detail in this beautiful art-deco style fine arts cinema was, to me, more than worth the price of admission.

Is it worth it?

On your projects, there will be many decisions to make that incorporate cost-benefit analysis. From the initial decision to start your project (or not), through scoping, requirements analysis, stage gates and all of the many change requests that may arise, opportunity assessments and risk response decisions, there will always be some level of cost-benefit analysis.

You also apply it regularly in your own life - for example, when you walk by an ice cream store, you may pause to consider whether to go in. 

Is a sweet, creamy cold dessert worth parting with a few dollars? 

Of course! So you go in and look at the board above the counter.

What flavor to choose?

Well, there are so many good ones - why not have more than one? Suddenly you have two cost-benefit decisions to make, all at once. If you buy two or three scoops, you get more taste variety for your tongue, and sure the cost is a bit more - but are those extra calories really worth it?

Maybe I should just get two scoops, not three.

So you wrestle with the options, and settle on two scoops. You can't have just one scoop, you reason - it would be lonely (or any other weak justification for having that second scoop). But you feel better (or less guilty) about not having the third scoop, even though you had enough change left over to get it.

In your projects, just as in life, there will be trade-offs, compromises, and value judgments. Some may require formal business cases with explicit hard expected benefits and deliverables for the estimated cost. Many more decisions will be less formal, in the day to day decision making of the project manager. But it is rarely going to be black and white.

In addition to any financial benefits from your project, you also need to consider other factors such as:

  • Will this give you a lead in the market?
  • Will this provide an enhanced customer experience?
  • Will this improve safety?
  • Will the benefits outweigh possible risks?
  • Will it give us an ongoing return? What will it be?
  • Will this save money on the project, or in operations?
  • Will it keep the stakeholders happy?
  • Do we even want to do it?
  • and so on.

Often, you will be considering the expertise and opinions of others when you do your cost-benefit analysis. This may be in the form of your best friend being a sounding board about that third scoop - or you may be presenting a case to your Project Board, who will make the final decision based on the best available information for significant decisions.

But when it comes down to it, in your projects and in life, when you factor in the various considerations, diagnoses, opinions, research and the myriad options that can feed into a decision - the basic question is simply "is it worth it?"


The truth is that we don't always know what the right decision will be, even when we make it with the best available knowledge. The theatre had their own baseline cost-benefit decision they had to make at every showing of a movie. On most nights it would not even come into play - but on a quiet Wednesday night, that is the scenario I came across.

They had a hard-cost factor to consider. The electricity cost to run the projector for a movie was around $100, or so the young man at the ticket booth claimed. They needed 12 tickets to be sold to be close to covering that cost; it was their baseline threshold and without that many seats sold, there would be no movie.

For me, the cost-benefit formula was a bit different. When I first arrived at the ticket booth, I had just been planning to see a current movie, at a reasonable price. My colleague had talked up the theatre, so I was willing to drive thirty minutes to go to the Rio, rather than the one five minutes away from my hotel. By the time I got there, it would not have been worth driving back to a different theatre. So I waited, uncertain if I would be able to see the movie and getting slightly annoyed. But it was still was worth waiting, rather than giving up and heading back to the hotel.

It had never occurred to me that there also might be something special inside the theatre. The person at the office had said it was a nice theatre, but had not gone into specifics. Had I known what I would see inside (forget about the movie for a minute), I may have been prepared to make a different decision.

Looking back at it, and considering how far I had come to see this one-screen theatre (half an hour plus several thousand miles from home), the likelihood that I may never come to this area again, and what I would experience inside the theatre, I would have been prepared to make a different cost-benefit decision up-front.

I would have been happy to pay for two or even three tickets, just to make sure the movie ran - and so I could have that opportunity to experience the art deco interior.

On the other hand, I am not sure it would have been worth buying up a fourth ticket. It was a very nice theatre - but $24 to see it would probably have been my limit. Also, as they only took cash, that was a limiting factor as well - I needed some money left over for popcorn and a drink.

Decor is nice to look at, but a movie without popcorn is just not the same.

Good luck with your projects, and if you ever get to Kansas City, make sure to go to the Rio Theatre in Overland Park. It will be well worth it - even if you need to buy an extra ticket.

Email: Gary Nelson, PMP