Decision making errors are costly and are growing more costly.
How would you rate your own decision making success?
We hear the same ole stories daily of young people starting relationships with people who are bad for them. Middle age people who spend too much time working and not enough time with family. Old people regret not stopping to smell the roses.
Why do so many of us make bad decisions?
If you read Decisive by the Heath brothers you will remember the 4 villains of decision making which are at the root of our bad decisions.
- This or that thinking. We give ourselves two options. “Should I break up with this person or not?” “Should I eat the cake or not.” “Should I fire this person or not?” We don’t give ourselves choices and other alternatives. Instead of asking ourselves if we should fire this person we could ask what would be necessary for this person to succeed. Or, take away the option. What if you couldn’t fire the person? How would you make it work?
- We trust our gut too much. It is amazing how fast we can form opinions about someone or something. We tend to put greater trust in our intuition than we should. We are overconfident about our ability to make good decisions. Want to make better decisions? Develop a process that goes beyond the Pros and Cons list. Disciplined corporate decision makers reap bigger rewards. They explore alternatives (How would/have different people solved this?). They recognize uncertainty (what if two years from now this ends up being a lousy decision, what would have caused it?). Searching for evidence that contradicts their belief (Cheesecake really is good for you).
- We are emotional. When we have difficult decisions to make our emotions churn. When emotions are high we need perspective. Try considering the opposite. Prepare to be wrong. What would an outsider do? Use Suzy Welch’s 10/10/10 approach. To use her method think about your decision in three different time brackets. How will you feel about it 10 minutes from now? 10 months from now? 10 years from now. Sometimes gripping emotion can be a signal of conflicting core values.
- We seek information that confirms our opinion and ignore information that contradicts. It is astonishing how quickly our opinions start to form. We are quick to develop opinions about something then seek out confirming information. You only focus on the data that supports your opinion. What TV News channel you watch is an example of supporting your biased opinions and beliefs. Work to challenge your beliefs by seeking out information that contradicts your opinion. According to the Heath brothers, this is the most dangerous of the villains.
Don’t fool yourself. Just about everyone assumes they are better at decision making than they really are. If you want to make better decisions you must be willing to create an objective process which starts with a deeper self-awareness.
We create objective processes around activities all the time. As a consultant, I encourage my clients to create an objective hiring process. It eliminate the cost of bad hires because hiring managers do make decisions based on their emotion, they don’t consider enough data points, they are over confident in their intuition. They didn’t invest the necessary time to follow a process. That is how bad hires happen. No one intentionally sets out to hire the bottom 20%.
The normal state of your mind is that you have intuitive feelings and opinions about almost everything that comes your way. Daniel Kahneman
HOW PI CAN HELP
Do you understand how you make decisions and judgments about things? Need better insight into your own decision making ability? Would you like to know how others around you make decisions?
A Predictive Index® assessment provides insight into how individuals make decisions and what is most likely to influence decisions.
If you would to complete an assessment or are an analysts and would like more information on using PI® to understand how an individual his likely to make decisions contact me.