3 Ways to Improve Your Decision Making

To make a good decision, you need to have a sense of two things: how different choices change the likelihood of different outcomes and how desirable each of those outcomes is. In other words, as Ajay Agrawal, Joshua Gans, and Avi Goldfarb have written, decision making requires both prediction and judgment.
But how do you get better at either? We’ve published volumes on this subject — here are a few of my favorites — but there are three rules that stand out. Following them will improve your ability to predict the effects of your choices and assess their desirability.
Rule #1: Be less certain.
Nobel-prize-winning psychologist Daniel Kahneman has said that overconfidence is the bias he’d eliminate first if he had a magic wand. It’s ubiquitous, particularly among men, the wealthy, and even experts. Overconfidence is not a universal phenomenon — it depends on factors including culture and personality — but the chances are good that you’re more confident about each step of the decision-making process than you ought to be.
Originally published at hbrascend.org.
