How to make better decisions

2010-03-13T15:51:00.000-08:00

An interesting article from New Scientist, ‘How to make better decisions’. It’s a top ten list and I’ve written some highlights from article below:

1. Don’t fear the consequences

Almost every decision we make entails predicting the future, we tend to overestimate the impact of decision outcomes when in fact decisions are less intense and briefer than most people imagine. People think a loss will hurt more than a corresponding gain but this is not always true. Try to find someone who has made the same decision or choice and see how they felt. Don’t always play it safe, the worst might not happen – and if it does you have the psychological resilience to cope.

2. Go with your gut instincts

It stands to reason that the extra information can help you make well-informed decisions, at the same time information overload can be a problem. If the choice you face is highly emotive, your instincts may not serve you well. Basically I think its saying here that too much information, too many choices and too much emotion will cloud your judgement so go with your gut instincts in such situations.

3. Consider your emotions

Our brains store emotional memories of past choices, which we use to inform present decisions but trying to make decisions under the influence of an emotion can seriously affect the outcome, e.g. don’t make a decision when angry. Anger can make us impetuous, selfish and risk-prone. One emotion that seems to help, though, is sadness, you tend to take the time to consider the various alternatives on offer, and end up making the best choices. In relation, many studies show that depressed people have the most realistic take on the world. So it’s not all good being happy.

4. Play the devil’s advocate

It is wrong to already have a favoured option that we want to justify instead or making a decision by rationally weighing up the alternatives. Make a good decision, don’t latch on to facts and figures that support the option your already suspect is the best, actively search for evidence that could prove you wrong, however painful that may be.

5. Keep your eye on the ball

With little to go on, we seem more prone to latch onto irrelevancies and let them sway our judgement, e.g. just because an item in a shop says reduced doesn’t mean to say it’s a good deal.

6. Don’t cry over spilt milk

The more we invest in something the more commitment we feel towards it. Always remind yourself the past is the past and what’s spent is spent, stop throwing good money after bad.

7. Look at it another way

I like this one. The choices we make are irrationally coloured by the way the alternatives are presented. There is a stronger bias towards options that involve gains and vice versa. Again this is down to emotion affecting your decision. Look at your options from more than one angle.

8. Beware social pressure

Never assume the group know best. If you find everyone agreeing, play the contrarian. Beware of situations in which you feel little individual responsibility – that is when you are most likely to make irresponsible choices.

9. Limit your options

Touched on above. Too many options can mean making the wrong decision or even doing nothing al all. More choice makes greater demands on your information-processing skills. You are more likely to make a mistake from a greater range of choice. If you’re out to just find ‘good enough’, a lot of the pressure is off and the task of choosing something in the sea of limitless choice becomes manageable. Again ask someone who’s made the same choice and see how they felt.

10. Have someone else choose

Sometimes relinquishing control of decision making can be more satisfying than making the decision yourself.

The article can be found here. I originally posted it back in 2007 here and have re-posted it to Buzz here. Oh and yes this is my first post to All Wordy and Junk. Hello everybody! :-)

All Wordy And Junk

How to make better decisions