Decisive

Essential reading would include Daniel Kahneman’s book, Thinking, Fast and Slow, mentioned above, and Dan Ariely’s Predictably Irrational. One of the handful of books that provides advice on making decisions better is Nudge by Richard Thaler and Cass Sunstein,

The first villain of decision making, narrow framing, which is the tendency to define our choices too narrowly, to see them in binary terms.

Notice the contrast with the pros-and-cons approach. Cole could have tallied up the advantages and disadvantages

Our normal habit in life is to develop a quick belief about a situation and then seek out information that bolsters our belief. And that problematic habit, called the “confirmation bias11,” is the second villain of decision making.

When people have the opportunity to collect information from the world, they are more likely to select information that supports their preexisting attitudes, beliefs, and actions.

The switch in perspectives—“What would our successors do?”—helped Moore and Grove see the big picture clearly.

This brings us to the third villain of decision making: short-term emotion.

In those moments, what we need most is perspective.

The fourth villain of decision making is overconfidence. People think they know more than they do about how the future will unfold.

And what we’ve seen is that there is a villain that afflicts each of these stages: You encounter a choice. But narrow framing makes you miss options. You analyze your options. But the confirmation bias leads you to gather self-serving information. You make a choice. But short-term emotion will often tempt you to make the wrong one. Then you live with it. But you’ll often be overconfident about how the future will unfold.

The nature of each villain suggests a strategy for defeating it:

Exposed to even a weak hint of another alternative—you could buy something else with this money if you want—is sufficient to improve our purchasing decisions.

Focusing is great for analyzing alternatives but terrible for spotting them.

What if we started every decision by asking some simple questions: What are we giving up by making this choice? What else could we do with the same time and money?

You cannot choose any of the current options you’re considering. What else could you do?

Multitracking keeps egos in check.

First, comparing alternatives helps executives to understand the “landscape”: what’s possible and what’s not, what variables are involved. That understanding provides the confidence needed to make a quick decision. Second, considering multiple alternatives seems to undercut politics. With more options, people get less invested in any one of them, freeing them up to change positions as they learn. As with the banner-ad study, multitracking seems to help keep egos under control. Third, when leaders weigh multiple options, they’ve given themselves a built-in fallback plan.

Get the benefits of multitracking, we need to produce options that are meaningfully distinct.

Avoid sham options, which exist only to make the “real” option look better.

To diagnose whether your colleagues have created real or sham options, poll them for their preferences. If there’s disagreement, that’s a great sign that you have real options. An easy consensus may be a red flag.

Our minds settle into certain well-worn grooves. Two of those grooves are common states of mind, studied widely by researchers, that play a role in almost every decision we make. One is triggered when we think about avoiding bad things, and one is triggered when we think about pursuing good things. When we’re in one state, we tend to ignore the other.

How you react to the position, in short, depends a great deal on your mindset at the time it’s offered. Psychologists have identified two contrasting mindsets that affect our motivation and our receptiveness to new opportunities: a “prevention focus,” which orients us toward avoiding negative outcomes, and a “promotion focus,” which orients us toward pursuing positive outcomes.

The most successful companies acted more like multitrackers, combining the best elements of promotion and prevention.

Multitrackers were 42% more likely to be strong rebounders than companies that were solely promotion focused, and they were 76% more likely to be strong rebounders than companies that were solely prevention focused. Thinking “AND not OR” turns out to be good corporate strategy.

Throughout Walton’s career, he kept his eyes out for good ideas. He once said that “most everything I’ve done I’ve copied from someone else.”

Walton found clever solutions by asking himself, “Who else is struggling with a similar problem, and what can I learn from them?”

One of the most basic ways to generate new options is to find someone else who’s solved your problem.

By encoding the advice, she’d be creating a kind of “playlist” of managerial greatest hits: questions to ask, principles to consult, ideas to consider. This playlist idea turns a reactive search—Who has solved my problem?—into a proactive step: We’ve already found the people who have solved this problem, and here’s what they said.

They force themselves to consider prescribed questions, one at a time, to generate new options. A “canned” list of stimuli seems to spark fresh insights.

Could you create your own playlist to help your colleagues discover options? Think about some of the common types of decisions that have been made historically in your organization.

A checklist is useful for situations where you need to replicate the same behaviors every time. It’s prescriptive; it stops people from making an error. On the other hand, a playlist is useful for situations where you need a stimulus, a way of producing new ideas. It’s generative; it stops people from overlooking an option. (Don’t forget to shine your spotlight over here …)

The most important lesson to learn about devil’s advocacy isn’t the need for a formal contrarian position; it’s the need to interpret criticism as a noble function.

If you haven’t encountered any opposition to a decision you’re considering, chances are you haven’t looked hard enough.

Let’s take each option, one at a time, and ask ourselves: What would have to be true for this option to be the right answer?

This same strategy of fishing for specific information was endorsed in a brilliant article called “On Being a Happy, Healthy, and Ethical Member of an Unhappy, Unhealthy, and Unethical Profession,” published in 1999 by U.S. District Court judge Patrick J. Schiltz.

Asking tough, disconfirming questions like these can dramatically improve the quality of information we collect, as illustrated in a study titled “There Is Such a Thing as a Stupid Question,” authored by three Wharton researchers, Julie A. Minson, Nicole E. Ruedy, and Maurice E. Schweitzer.

How do you know whether to ask probing questions or open-ended ones? A good rule of thumb is to ask yourself, “What’s the most likely way I could fail to get the right information in this situation?”

Some organizational leaders urge their employees to “assume positive intent62,” that is, to imagine that the behavior or words of your colleagues are motivated by good intentions, even when their actions seem objectionable at first glance.

Psychologists distinguish between the “inside view” and “outside view” of a situation. The inside view draws from information that is in our spotlight as we consider a decision—our own impressions and assessments of the situation we’re in. The outside view, by contrast, ignores the particulars and instead analyzes the larger class it’s part of.

Perhaps the simplest and most intuitive advice we can offer in this chapter is that when you’re trying to gather good information and reality-test your ideas, go talk to an expert.

When you need trustworthy information, go find an expert—someone more experienced than you. Just keep them talking about the past and the present, not the future.

When we zoom out, we take the outside view, learning from the experiences of others who have made choices like the one we’re facing. When we zoom in, we take a close-up of the situation, looking for “color” that could inform our decision. Either strategy is helpful, and either one will add insight in a way that conference-room pontificating rarely will. When possible, we should do both.

To ooch is to construct small experiments to test one’s hypothesis.

Ooching is a diagnostic, then, a way to reality-test your perceptions.

If you’re scoring at home, what the data shows is that applied base rates are better than expert predictions, which are better than novice predictions.

In a 2011 speech he said, “When the bosses make the decisions, decisions are made by politics, persuasion, and PowerPoint.” None of those three P’s, Cook notes, ensures that good ideas will triumph. By making decisions through experimentation, the best idea can prove itself.

Ooching has one big flaw: It’s lousy for situations that require commitment.

Ooching is best for situations where we genuinely need more information. It’s not intended to enable emotional tiptoeing, in which we ease timidly into decisions that we know are right but might cause us a little pain.

TO OOCH IS TO ask, Why predict something we can test? Why guess when we can know?

To use 10/10/10, we think about our decisions on three different time frames: How will we feel about it 10 minutes from now? How about 10 months from now? How about 10 years from now? The three time frames provide an elegant way of forcing us to get some distance on our decisions.

10/10/10 helps to level the emotional playing field. What

Yet with one question—“What would our successors do?”—Grove managed to add some distance to the decision. By imagining what a clear-eyed replacement CEO would do, Grove sidestepped short-term emotion and saw the bigger picture.

Somehow the choice was clearer when students thought about their best friends than when they thought about themselves. Distance yielded clarity.

Without clear priorities to draw on, the decision will be made idiosyncratically, depending on the employee’s mood at the moment.

When we identify and enshrine our priorities, our decisions are more consistent and less agonizing.

First, people rarely establish their priorities until they’re forced to.

To spend more time on our core priorities (which, surely, is our goal!) necessarily means spending less time on other things. That’s why Jim Collins, the author of Good to Great, suggests that we create a “stop-doing list100

An hour spent on one thing is an hour not spent on another.

That MIT study showing that, over the course of a week, managers spent no time whatsoever on their core priorities?

Estimates grew much more accurate when they were asked to explicitly consider the high and low ends of the range.

Gunther-Murphy introduced them to a technique called “failure mode and effect analysis” (FMEA), a precursor to the premortem that has been used for decades in the military and government. In an FMEA, team members identify what could go wrong at every step of their plans, and for each potential failure they ask two questions: “How likely is it?” and “How severe would the consequences be?” After assigning a score from 1 to 10 for each variable, they multiply the two numbers to get a total. The highest totals—the most severe potential failures—get the most attention.

We might also err by failing to prepare for unexpectedly good outcomes. When we bookend the future, it’s important to consider the upside as well as the downside. That’s why, in addition to running a premortem, we need to run a “preparade.” A preparade asks us to consider success:

It’s hard to interrupt these autopilot cycles because, well, that’s the whole point of autopilot. We don’t think about what we’re doing. We drift along in life, floating on the wake of past choices, and it’s easy to forget that we have the ability to change direction.

One solution to this is to bundle our decisions with “tripwires,” signals that would snap us awake at exactly the right moment, compelling us to reconsider a decision or to make a new one. Think

Day-to-day change is gradual, even imperceptible, it’s hard to know when to jump. Tripwires tell you when to jump.

(We’ve probably all ignored a fire alarm, trusting that it is false.) But tripwires at least ensure that we are aware it’s time to make a decision, that we don’t miss our chance to choose because we’ve been lulled into autopilot.

One option is to set a deadline, the most familiar form of a tripwire. Some deadlines are natural, such as the deadline for filing stories at a daily newspaper—the printing press has to roll at a certain time, whether the story is ready or not. But it’s easy to forget that most of the deadlines we encounter in life are simply made up. They are artificially created tripwires to force an action or a decision.

That quick switch is what we need so often in life—a reminder that our current trajectory need not be permanent. Tripwires provide a sudden recognition that precedes our actions: I have a choice.

The point is not that compromise is a necessary evil. Rather, compromise can be valuable in itself, because it demonstrates that you’ve made use of diverse opinions, which is a way of limiting risk. Here’s why: Bargainers come to the table with different options, which helps the group dodge a narrow frame. (Indeed, bargainers typically consider at least two complete alternatives in making a decision, as opposed to the one alternative considered in other decisions.) Also, bargainers tend to act as devil’s advocates for each other, asking the disconfirming questions that people don’t always ask themselves.

Even if the outcome goes against us, our confidence in the process is critical. By acknowledging flaws in his decisions, Hitz is encouraging his team to put their faith in a process rather than in a single decision. Individual decisions will frequently be wrong, but the right process will be an ally in any situation.

Using a process for decision making doesn’t mean that your choices will always be easy, or that they will always turn out brilliantly, but it does mean you can quiet your mind. You can quit asking, “What am I missing?” You can stop the cycle of agonizing.

When researchers ask the elderly130 what they regret about their lives, they don’t often regret something they did; they regret things they didn’t do. They regret not seizing opportunities. They regret hesitating. They regret being indecisive.