The One-Page Decision Memo: Structure, Example, Process

Why are so many decisions postponed?

Many companies have a list of questions that have been open for weeks: a second service vehicle, new software, a price change for regular customers. Each one ends up on the agenda at some point. Then someone starts with the background, someone else has an idea nobody has checked, and in the end people say more figures are needed. The decision moves to next week.

That costs more than meeting time. As long as nothing is decided, everyone works with a stopgap, and whoever is waiting for the decision cannot plan ahead. This leads to the guiding question of this guide: How must a decision memo be structured so that a group can decide in one meeting, and decide better than without it?

To answer it, we first clarify what a decision memo is and when it pays off. Then we introduce the pyramid principle as a thinking model, review what research says about group decisions, and weigh whether memos slow things down or speed them up. At the end there are the eight-field decision page, a filled-in example, and the process.

Whoever cannot get a decision onto one page has usually not finished thinking it through.

What is a decision memo, and when does it pay off?

A decision memo is a short document that prepares a single decision so that the responsible person or group can make it in one meeting. It contains a clearly stated question, at least two options, their assessment, and a reasoned recommendation. It differs from a report in that it leads to a choice. It differs from a presentation in that it is read in advance and can be understood without a talk.

Not every decision needs a memo. The guide to setting decision rights sorts decisions by two questions: how large is the impact, that is, amount and risk? And how easily can the decision be reversed? A postponed delivery is a two-way door and needs no memo. A hire, a three-year framework contract, or an investment that noticeably affects the annual budget does.

The thinking model: the pyramid principle

Barbara Minto, one of the first women to work as a consultant at McKinsey, described a principle for business writing that is still taught in consulting today: the pyramid principle (Minto 1987). Its core is a reversal of the usual order. We tend to tell things chronologically, from the starting point through the analysis to the result. Readers want it the other way around: the answer first, then the reasons, then the evidence.

At the top of the pyramid there is therefore a single statement, the recommendation. Below it come a few reasons that support it, usually three. Each reason is backed below with figures or facts. For the opening, Minto recommends a short sequence of situation, complication, and question: what is the status, what has changed, and what question follows from that? The recommendation is then the answer to exactly this question.

A news report works on the same idea. Whoever reads only the headline and the first sentence knows what happened. Whoever reads on learns details. For a decision meeting, this means: after the first paragraph of the memo, everyone knows what is to be chosen and what is recommended. The meeting can begin with the reasons instead of the background.

1. Situation

   The status in two sentences everyone can agree on. Example: we have two service vehicles, both fully booked four days out of five.

2. Complication

   What has changed or no longer fits. Example: since March, customers have waited nine days on average for an appointment, and three maintenance contracts were not renewed.

3. Question

   The one question to be decided. Example: do we add a third vehicle with a technician?

4. Recommendation

   The answer in one sentence, with a condition if needed. Example: yes, as a two-year lease, if we can fill the position by July.

What research shows about decisions in groups

The strongest argument for a written memo comes from group research. Stasser and Titus (1985) showed that groups prefer to talk about information that everyone already knows. Knowledge held by only one member is raised less often, even if it would change the decision. This pattern is called the hidden profile, and the article on fewer meetings and better decisions describes it in detail. Lightle, Kagel, and Arkes (2009) found in experiments with financial incentives: based on what their members remembered, the groups could have uncovered a good three quarters of the hidden profiles. In fact, they succeeded in 35 percent of cases.

A memo counters this in two ways. It puts the decisive facts on the table before the discussion, and it gives everyone the chance to send back their own knowledge as an addition in advance. Individual knowledge thus surfaces before the group settles on what is already known.

A second argument concerns thinking errors. Sibony, Lovallo, and Powell (2017) note that people hardly shed known biases such as confirmation bias or the planning fallacy, even when they know a lot about them. They conclude that companies should rely less on individual insight and more on the design of their decision processes. A memo with fixed fields is such a process on a small scale. It requires, for example, a second option and a counterargument even if the author is long convinced. Which thinking errors are typical is described in the article on thinking errors of entrepreneurs.

Lovallo and Sibony (2018) point to a third issue. Not every consequential decision is recognized as such. Besides obviously strategic decisions, there are habitual ones that pass as routine although, taken together, they shape the business. For the memo, this means: whether a decision needs a memo should be judged by impact and reversibility, not by how important it feels.

Does a memo slow things down or speed them up? Two perspectives

The first view says: memos are bureaucracy. In a small company the paths are short, and whoever first has to write a page decides more slowly. This view is right for the many small, reversible decisions, and nobody should demand a memo there.

The second view says: a memo moves work forward and saves it later. In his letter to Amazon shareholders for 2017, Jeff Bezos described how, instead of slides, narratively structured six-page texts are written there and read silently at the start of the meeting. He openly admits that a good text of this kind can take a week or more. According to his account, the effort pays off because the meeting then starts with the actual question.

I consider both views correct, but for different decisions. For a small company, six pages are too much. One page is enough, and only for decisions that are large and hard to reverse. In a company with 20 employees, these are rarely more than two or three a month. For these few, the hour a memo costs is well spent, because a postponed decision costs anew every week.

The decision page: eight fields

The tool of this guide is the decision page. It translates the pyramid principle into eight fixed fields. The first two are at the top so that whoever reads only them understands the situation.

Two fields are left out most often and are the most valuable. Doing nothing as an option forces you to name the cost of waiting. And the counterargument prevents the memo from becoming an advertisement for one’s own opinion. A proven aid is to imagine the failure in advance: suppose it is a year later and the decision has turned out to be a mistake. What is the most likely reason? The article on deciding under uncertainty discusses how to deal with the remaining risk.

Example: do we need a third service vehicle?

A building services company with 20 employees has two service vehicles. The waiting time for appointments has increased, and customers are dropping off. The workshop manager writes a decision page. In the assessment field, she compares three options against four criteria that she weighted with the owner beforehand: effect on waiting time, annual cost, risk, and reversibility.

The recommendation reads: a third vehicle on a two-year lease if a technician is found by July. The counterargument field says: if the position is not filled, an expensive vehicle sits in the yard. The condition in the recommendation answers this objection. The reversibility field states that the lease can be terminated after twelve months for a fee. The group decides in 20 minutes because the discussion starts with the condition and not with the background.

The point values are not the most important part. A weighted assessment looks more precise than it is, because weights and individual ratings are judgments. Its value lies in making these judgments visible. Whoever disagrees can say which weight seems too high instead of objecting in general.

How does a decision with a memo work?

1. Set the question

   The decision-maker and the author formulate the one question and the deadline together. No clear question, no memo.

2. Write the memo

   At most one page, the eight fields, recommendation at the top. Figures that do not fit go into an appendix that nobody has to read.

3. Send it two days ahead

   All participants read the memo and send back missing facts in writing before the meeting starts.

4. Read silently at the start

   Whoever has not read the memo reads it in the first five minutes. After that, nobody presents; people ask and weigh.

5. Decide and record

   The decision, the main reasons, and the expected consequences are written down, ideally in the decision journal, so that you can later check whether the assumptions held.

Conclusion: what makes a good decision memo?

We set out to ask
a decision memo must be structured so that a group can decide in one meeting, and decide better than without it. The answer has three parts. First, the order: following the pyramid principle, the recommendation is at the top, the reasons below, the evidence at the bottom. Second, the content: at least two options plus doing nothing, an honest counterargument, and a statement of whether the decision can be reversed. Third, the process: the memo is read in advance so that individual knowledge reaches the table.

As shown, the memo only pays off for the few decisions that are large and hard to reverse. For these, however, it moves work from the meeting table to the desk, where it is cheaper. The sober observation is: a good memo does not make the decision easier, but it ensures that people argue about the right question.

The next step

1. Find the decision that has been open the longest in your company.
2. Formulate it as one question with a deadline and name who decides.
3. Write a decision page with the eight fields for it, at most one page.
4. Send it two days before the meeting and ask for written additions.
5. Record the decision and its most important assumption, and set a date on which you will review it.