Balance Sheets are a great decision-making tool for different types of decision-making problems.
Best used for:
- Two options decisions
- Multiple options decisions
- Big life decisions
- Daily life decisions
A balance sheet is a piece of paper with two columns. In each column, you list the pros and cons of the choices in question. You then subtract equal pros and cons for the competing decisions until you reach a clear winner.
History of balance sheets
Founding Father of the United States Benjamin Franklin (1706-1790) is one of the earliest known people to use a balance sheet for decision making. He described his method of making decisions in a letter to chemist and philosopher Joseph Priestley. First, he divided a sheet of paper into two columns, for pros and cons. In the following days, he wrote down the different motives that occurred to him.
He then started to estimate their respective weights, i.e., level of importance. Whenever he found one on each side that seemed of equal weight, he struck them both out. If he found a “pro” reason equal to two “con” reasons, he struck all three out. If two “con” reasons equaled three “pro” reasons, he struck all five out. He proceeded this way until he found the balance. If, after a day or two of further consideration, nothing new appeared, he decided accordingly. He called this moral or prudential algebra.[i] [ii]
Franklin wasn’t the only important figure who used paper and reason for decision making. In 1838, Darwin (1809 – 1882) wrote in his journal “The day of days!” as he got engaged to his cousin, Emma Wedgwood. But before the proposal, Darwin wrote two notes weighing up the pros and cons of marriage and asking himself questions.
He came to a conclusion, “Never mind my boy — Cheer up — One cannot live this solitary life, with groggy old age, friendless & cold, & childless staring one in one’s face, already beginning to wrinkle. — Never mind, trust to chance –keep a sharp lookout — There is many a happy slave.” They were married in 1839 and had 10 children, putting reason to the test. (Original manuscripts are in the Darwin Archive in Cambridge University Library)[iii]
Balance sheets are an old and trusted decision-making tool for many decision-making types.
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[i] Franklin B, Labaree LW. Mr. Franklin: A Selection from His Personal Letters. Yale University Presss; 1956.
[ii] Benjamin Franklin’s 1772 letter to Joseph Priestley – ProCon.org. https://www.procon.org/view.background-resource.php?resourceID=1474 which cites: Accessed October 17, 2017.
[iii] Darwin on marriage | Darwin Correspondence Project. https://www.darwinproject.ac.uk/tags/about-darwin/family-life/darwin-marriage. Accessed October 17, 2017.