Definition

zero-based thinking (ZBT)

Part of the Business terms glossary:

Zero-based thinking (ZBT) is a decision-making process based on imagining yourself back at the point before particular decisions were made, and free to make those decisions with the knowledge that you have now about their outcome. Such decisions could be buying financial securities, hiring certain types of employees or following particular career paths, among a wide variety of other possibilities. The purpose is to avoid repeating past mistakes and to encourage actions that have worked out favorably.

In effect, ZBT works like hindsight, based on experience, applied from a hypothetical future to the actual present in order to maximize the chance of success and/or avoid the risk of failure.

In ZBT, the state of affairs before one has done anything about a situation is called the zero point. When applying ZBT, one can ask, "With what I know today about past situations like this one and the way that I dealt with them, would I want to do the same thing again this time?"

  • If the answer is yes, then the proper course of action is to continue the tried-and-true procedure relevant to the situation in an attempt to achieve the desired outcome.
  • If the answer is no, then one should return to the zero point and avoid the situation or, if it has already begun to play out, to exit it as soon as possible.

After one has focused attention on the zero point one should carefully assess the situation at hand and decide whether or not to deal with it at all. In some cases, the best solution is to avoid or get out of a situation to cut losses. A principal key to effective use of ZBT is knowing when to quit, and if necessary, actually quitting.

This was last updated in April 2013
Contributor(s): Stan Gibilisco
Posted by: Margaret Rouse

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