How do we decide? How does our mind work when considering a decision? Do biases, guts and emotions influence our decisions or is it only an analytical process?
Decision making is not an executive’s job. We always make decision consciously or unconsciously, we choose what we eat, what we wear but these decisions usually are not vital but a doctor’s inappropriate decision may kill the patient or a great decision like Apple’s iTunes can extricate a firm from bankrupt.
Thomas Davenport emphasizes quantitative, data-based and analytic decision making in “Making Better Decisions” article. But he does not claim that automated decision systems should be used to replace human decision makers. Decision approaches such as analytical, neuroscience (with using motional brain) and intuition (gut and experience) cannot fit in all situations, appropriate approaches should be used together.
Alden Hayashi mention about a research of Antonio R. Damasio, a leading neuroscientist, about people who have suffered brain damage in their prefrontal cortices, where secondary emotions such as sorrow are processed. Such patients retain normal function in many respects-their language and motor skills, attention, memory, intelligence-but they have trouble experiencing certain emotions. But they do not make even very simple decisions. Damasio says “our emotions and feelings play a crucial role by helping us filter various possibilities quickly, even though our conscious mind might not be aware of the screening. “
Executives solve complex problems that could not be solved by analytically and logically, with intuition approach. But how this intuition comes from? According to Herbert Simon, when we use our gut, we're drawing on rules and patterns that we can't quite articulate. Simon found that grand masters of chess are able to recognize and recall perhaps 50,000 significant patterns of the astronomical number of ways in which the various pieces can be arranged on a board. "Experts see patterns that elicit from memory the things they know about such situations," says Simon. Henry Mintzberg, professor of management at McGill University and a longtime proponent of intuitive decision making, says the sense of revelation at the obvious occurs when your conscious mind finally learns something that your subconscious mind had already known.
We can develop decision making process with defining the alternatives, collecting the right and adequate information and notice Davenport’s recommendation : “ Smart organizations can help their managers improve decision making in four steps: by identifying and prioritizing the decisions that must be made; examining the factors involved in each; designing roles, processes, systems, and behavior to improve decisions; and institutionalizing the new approach through training, refined data analysis, and outcome assessment.” Therefore, it is critical to balance and augment logical / analytic perspectives with human intuition and judgment.
Paul Arden point out that everyone make sensible decisions, to make difference, he encourages readers to make bad and wrong decisions while thinking illogically in his book “Whatever you think, think the opposite”. Do all bad decisions yield better results? No, the way of our mind works leads our decisions and there are many traps that we could not recognize easily. When considering a decision, the mind gives disproportionate weight to the first information it receives. This trap is called anchoring trap. There is another trap is sunk cost (also known as gambler’s syndrome) which people continue to fail because of . We can fail to see, seek, share and use information as well. Briefly, various traits of human nature can easily cloud our decision making.
The key point is the awareness. We can reduce the undesirable impact of human being with awareness. Bazerman and Chugh say “Most people fail to bring the right information into their conscious awareness at the right time” in the article, “Decisions without blinders”. They mention about bounded awareness with the pathetic results of Vioxx case. They recommend some techniques to decrease bounded awareness. The recommendations are very similar with the Hammand’s and Keeney’s suggestions in the article “Hidden Traps in Decision Making” and Hayashi’s in the article “When To Trust Your Gut”.
They all agree with these approaches:
· Always view a problem from different perspectives.
· Be open-minded
· Be aware of biases
· Examine all the evidence with equal weight
· Play devil’s advocate, to argue against the decision you’re contemplating and devil’s inquisitor to look for evidence against bounded awareness.
To make difference and make effective and right decisions we should use our emotions, feelings, guts and biases. Our goal should be to find the best decision for current circumstances in an appropriate time without choosing the way just because it is easy like status quo. The only point is to attend the awareness of the dangers of biases and guts.
Articles:
· The Hidden Traps In Decision Making, Hammond Js, Keeney Rl, Raiffa H, Harvard Business Review, Volume: 84,Issue: 1, Pages: 118-+,Jan 2006
· Make Better Decisions. Davenport, Thomas H.Harvard Business Review (0017-8012) Nov2009. Vol.87,Iss.11;p.117
· When to Trust Your Gut, Hayashi, Alden M.; Hayashi, Alden M. Harvard Business Review (0017-8012) 2/1/2001. Vol.79,Iss.2;p.59-65
· Decisions Without Blinders. Bazerman, Max H.; Chugh, Dolly; Bazerman, Max H. Harvard Business Review (0017-8012) 1/1/2006. Vol.84,Iss.1;p.88-97
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