Before committing scarce time, people, or money, name the best forgone use of those resources and the value delta of the chosen path versus that alternative.

Opportunity Cost Core rule: every commitment displaces its best alternative. Report both that forgone value and the net value delta; decide on the delta, not the chosen path alone. When to Use Allocating scarce time, headcount, budget, or attention across competing options Feature prioritization, build vs buy, tech debt vs product work Saying yes to a large commitment that displaces other work Comparing a bold path against polishing the status quo when windows may close When NOT to Use Trivial or cheaply reversible choices where analysis costs more than the resource No real alternative use (resource is idle, earmarked, or non fungible) Mandatory work (compliance, security fix, hard dependency) with no optional alternative Inventing speculative alternatives only to look rigorous when the next best is clearly worse Procedure 1. State the commitment. Name the choice, the scarce resource units (eng weeks, dollars, calendar), and the decision horizon. 2. List real alternatives, including do nothing. At least: proposed option, next best productive use of the same resources, and status quo / wait. Drop fantasy options with no owner or feasibility. 3. Value each path. For each alternative, estimate direct value, strategic value, risk, and time to value in the same units. Prefer rough comparable magnitudes over fake precision. 4. Compute best forgone value and value delta. Identify the single best non chosen alternative (may be do nothing). best forgone value = its estimated value. value delta = chosen value − best forgone value (same units). True cost of choosing = direct cost of the choice + best forgone value . Prefer the option with the superior (positive) value delta after risk; a large positive chosen value is not enough if the forgone alternative is larger. 5. Future tradeoff / permanent forgone options. For serious alternatives (including the bold path): mark temporary recoverable costs vs permanent losses (window closes, lock in, no re entry). Prefer avoiding the greater permanent loss when acting downside is recoverable and non catastrophic—even if near term value delta is slightly negative. Do not invent permanence for speculative upside without evidence. 6. Strongest countercase and decide. Steel the case that the best alternative or its value is misidentified (sunk cost anchoring, status quo undervalued, or a "free" option that still burns time). Recompute value delta under that challenge. Then choose: proceed if delta stays favorable (or permanent loss rule applies), else switch, wait, or split. Stop when ranking is stable. Output Verification Falsify: If the analysis never names a concrete next best use of the same resources, or reports only one number labeled both "opportunity cost" and "delta," it is incomplete—add B, then report best forgone value and value delta separately. Stop: When one best forgone alternative and a signed value delta determine the choice, stop enumerating weaker options. Over application guard: Do not run full accounting on mandatory or trivial work. Ignore sunk costs; revalue only from current state forward.

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