4 Worst Mistakes in Decision Making
Decision making is hard. We often make critical decisions in an environment of limited and inaccurate information, time pressure, high emotions and conflicting opinions about potential outcomes and implications.
Moreover, most of us lack the tools to make proper decisions. This is not due to a deficit of academic models, or practical methodologies designed to assist decision makers. Rather, the entire discipline of decision making is still seldom known (or applied) outside the realms of governmental and corporate strategy.
With this in mind, let’s start with a few simple ways to avoid some of the biggest and most common decision making mistakes. Here we go:
1. Poorly defined decisions
It is difficult to understate the importance of defining your decision. Undefined, or poorly defined decisions will inevitably lead to poor choices.
To help me define a decision in a concise and straightforward manner, I use a powerful exercise borrowed from method acting. This exercise consists of two simple questions that will help you help you focus on WHAT you are trying to decide, and, more importantly, understand WHY you are faced with this decision in the first place. The catch here is that this exercise will not work unless you are completely and brutally honest with yourself.
- What is your “Super Objective”— the ultimate goal, at the highest possible level, that you are looking to advance or achieve with this decision? This “know thyself” question could be powerfully introspective. Answers such as “I want to live an interesting and meaningful life” or “I seek to make an historic impact on the future of humanity” are completely plausible, as long as they remain candid. This is also applicable to a vision of a group or an organization.
- What is the main “Obstacle” — whether internal or external, preventing you from reaching your “Super Objective” and thereby forcing you to make the current decision? The Obstacle has to relate directly to the Super Objective in order to be plausible.
If you are having trouble defining the relationship between the Obstacle and your Super Objective, you may be thinking about your decision in a wrong way. What’s more, following this exercise, your difficult, critical decision may turn out to be more trivial than you thought.
When defining your decision, it is important to be as focused and concise as possible. Include only the information that describes your Super Objective and the Obstacle — everything else is likely to be irrelevant.
2. Deciding alone
A plethora of research shows that input from others significantly improves accuracy and quality of decisions. To make critical decisions alone is to leave yourself at the mercy of your own cognitive and informational limitations.
Most high-level decision makers rely on experts and trusted advisors. You will do yourself a favor by finding knowledgeable and experienced people and asking them for advice in the process of making a decision.
Complicated decisions will inevitably require you to break the decision down into components and ask for focused input from domain experts, in addition to general feedback.
3. Disregard for facts
Facts are a decision maker’s most powerful tool. Failure to respect facts will lead you to make decisions based on information that’s incomplete, inaccurate and improperly framed.
Like insatiable beasts, decisions crave data and are always hungry for more. Feed them with relevant and concise information, and they will thrive, offering you confidence regarding your decision, possible alternatives and outcomes.
Make sure the information you use is both complete and relevant. This is easier said than done, as there could be an endless number of data points supporting any given decision. It is important to concentrate on the most important metrics required for evaluating your alternatives.
Furthermore, facts should be framed as objectively as possible. You do not want to make decisions based on unverified information, or improperly emphasized data points, such as Eric Ries’ “Vanity Metrics”.
4. Neglected intuition
Learn to trust and develop your intuition. A well-tuned intuition could help you bridge the gap between instinctual response and reason, and will serve you well in all but the most technical decisions. After you have evaluated and analyzed your decision, listen to your gut and ask whether the choice you’ve selected “feels right” to you.
Even if the choice feels completely wrong, do not rush to change your decision. Choosing an instinctual choice, when objective data and rational analysis point otherwise, will likely lead to disastrous results.
In order to make sure your instinctual response supports, rather than interferes, with your reasoning, it is prudent to “sleep on it” and see if you still feel the same way in the morning. This age-old advice works well in combination with rational decision analysis and could help you gain an invaluable fresh perspective. If your choice still feels wrong, ask yourself whether you have enough information to make a rational decision.
You can avoid some of the most common mistakes in decision making by arming yourself with brutal honesty, facts, trusted advisors and by training your intuition. Add a solid methodology into the mix, and your decision-making abilities will flourish.
Why did I write this? I have an academic background in strategic decision making and remain deeply interested in this field. My goal is to create an easy-to-use guide to best practices in decision making with a compilation of posts and stories in this collection.
