DECISION MAKING

(A research report)

S u b m i t t e d b y :

S W A R U P A R A N I S A H U

( S e c : B , F 1 1 1 1 6 )

1. INTRODUCTION

A major part of decision making involves the analysis of a finite set of alternatives described

in terms of some evaluative criteria. These criteria may be benefit or cost in nature. Then the

problem might be to rank these alternatives in terms of how attractive they are to the decision

maker(s) when all the criteria are considered simultaneously. Another goal might be to just

find the best alternative or to determine the relative total priority of each alternative (for

instance, if alternatives represent projects competing for funds) when all the criteria are

considered simultaneously. Solving such problems is the focus of multi-criteria decision

analysis (MCDA) also known as multi-criteria decision making (MCDM). This area of

decision making, although it is very old and has attracted the interest of many researchers and

practitioners, is still highly debated as there are many MCDA / MCDM methods which may

yield very different results when they are applied on exactly the same data. This leads to the

formulation of a decision making paradox.

2. STAGES OF DECISION MAKING

Developed by B. Aubrey Fisher, there are four stages that should be involved in all group

decision making. These stages, or sometimes called phases, are important for the decision-

making process to begin:

Orientation stage- This phase is where members meet for the first time and start to get to

know each other.

Conflict stage- Once group members become familiar with each other, disputes, little fights

and arguments occur. Group members eventually work it out.

Emergence stage- The group begins to clear up vague opinions by talking about them.

Reinforcement stage- Members finally make a decision, while justifying themselves that it

was the right decision.

3. DECISION MAKING STEPS

Each step in the decision making process includes social, cognitive and cultural obstacles to

successfully negotiating dilemmas. Becoming more aware of these obstacles allows one to

better anticipate and overcome them. Pijanowski (2009, p.7) developed eight stages of

decision making based on the work of James Rest:

Establishing community: creating and nurturing the relationships, norms, and procedures

that will influence how problems are understood and communicated. This stage takes place

prior to and during a moral dilemma

Perception: recognizing that a problem exists

Interpretation: identifying competing explanations for the problem, and evaluating the

drivers behind those interpretations

Judgment: sifting through various possible actions or responses and determining which is

more justifiable

Motivation: examining the competing commitments which may distract from a more moral

course of action and then prioritizing and committing to moral values over other personal,

institutional or social values

Action: following through with action that supports the more justified decision. Integrity is

supported by the ability to overcome distractions and obstacles, developing implementing

skills, and ego strength

Reflection in action: When in an organization and faced with a difficult decision, there are

several steps one can take to ensure the best possible solutions will be decided. These steps

are put into seven effective ways to go about this decision making process (McMahon 2007).

The first step -Outline your goal and outcome. This will enable decision makers to see

exactly what they are trying to accomplish and keep them on a specific path.

The second step - Gather data. This will help decision makers have actual evidence to help

them come up with a solution.

The third step -Brainstorm to develop alternatives. Coming up with more than one solution

able to see which one can actually work.

The fourth step - List pros and cons of each alternative. With the list of pros and cons, you

can eliminate the solutions that have more cons than pros, making your decision easier.

The fifth step - Make the decision. Once you analyse each solution, you should pick the one

that has many pros (or the pros that are most significant), and is a solution that everyone can

agree with.

The sixth step - Immediately take action. Once the decision is picked, you should implement

it right away.

The seventh step - Learn from, and reflect on the decision making. This step allows us to see

what you did right and wrong when coming up, and putting the decision to use.

4. VARIOUS DECISION MAKING MODELS

Kepner Tregoe Model

Decision step models

Six Thinking Hats

Carnegie Decision Model

Iterative Decision Model

Vroom-Yetton-Jogo Decision Model

Contingency Decision Model

5. SEVEN STEP DECISION-MAKING MODEL

This model was developed by Rick Roberts of the University of North Florida career

services. It was designed for those who wanted a decision-making model to help with

choosing a career path or deciding what to do about a job offer. An important factor in the

model is information gathering. It is suggested that the more information that's available, the

easier it is to make decisions. So many of the steps are designed to do just this.

The 7 steps :

Identify the decision to be made - exactly what are you trying to decide?

Know yourself - what are your strengths, weaknesses, skills, values and interests

Identify options - list the various choices so far

Gather information and data - about each alternative

Evaluate options that will solve the problem, pros, cons and risks of each

alternative

Select the best option- may be necessary to loop back and gather more info

Develop a plan of action - and implement it!

Pros and Cons

The 7 Step Decision Making Model was designed for career decision making and so can be a

bit cumbersome if applied to decisions that are not as significant. Not so useful for deciding

between chocolate or vanilla ice cream, for example! Information overload may actually

inhibit the decision making, as well as trying to figure out which information is relevant and

which is not. And this model is not how we as humans naturally make decisions. The first

step in the 7 Step Decision Making Model is very important, whatever decision we have to

make. Sometimes just clarifying what the decision is, or what the question you want

answered is, makes it much easier to decide.

6. IMPROVE OUTCOMES USING DECISION MAKING TIPS

Here are some decision making tips and ideas that can help to reach goals and fulfil

personal or business vision. Decisions do not sit in isolation. A connected decision

framework can help reveal the decisions that should guide your current choice, as well as the

decisions that might be impacted. Avoid being surprised by misaligned choices and

unintended consequences by considering the Connected Decisions before you decide. These

tips avoid common decision errors, and as a guide to building your decision making skills.

These tips for decision making are categorized as:

Prioritization :

Good decision making takes time and effort. Make time for important decisions by:

Not spending effort on decisions that aren't needed

Establishing the value of a decision and prioritizing those with the highest value (and

importance)

Quickly deciding low value (less meaningful) choices that don't justify additional time

or effort

Delegating lower value decisions that can be made by others

Moving faster on reversible choices and more carefully on decisions that will have

immediate consequences that aren't easily changed

Decision timing:

The best decision timing is achieved when the value of a decision is maximized by balancing

the time needed to gain knowledge that informs the choice against the benefit loss that may

result due to delay of decision implementation. The following decision making tips can help

in improving that balance.

Characterize the success factors or goals for the decision as the minimum information

that must be gathered. Benefits won't be gained from the decision if factors that create

value haven't been defined.

Significant emotions can be involved that will motivate choosing too early or too late.

If managing emotional responses becomes difficult, use an emotionally detached third

party to help determine when best to decide.

Give preference toward choosing sooner if information gathering and analysis efforts

appear to be delaying clear benefits. Future outcomes always carry uncertainty, and

making a decision may sometimes be the least expensive way to gain the knowledge

of what will happen.

Anticipate and be proactive for high value decisions. Strategic decision making can

enable needed information and analysis efforts by considering choices well ahead of

potential consequences.

Don't let little choices accumulate. Apply time management techniques to your

decision making to prevent a challenging backlog.

Process :

Have a decision making process. A well-developed process enables continued improvement

with each additional decision. A process can help reduce many of the biases and thinking

errors that commonly occur when choosing. Consider these guidelines for your decision

making process:

Record your decision efforts. It is hard to learn and improve from something that is

not written down. Having things written also makes it possible to keep relevant

information visible.

Define success factors or criteria in advance of considering options. This ensures your

needs and desires are understood prior to being influenced by benefits from specific

solution alternatives.

Try to get a balanced set of success factors. Outcomes often fail because a critical

need or desire was not considered.

Determine alternatives before gathering data.

The process should consider the consequences and possible outcomes of alternatives,

including how the decision will be implemented.

Give preference to objective data, but subjective data is better than no data.

Evaluate all alternatives for the same criteria versus all criteria for the same

alternative. This helps avoid bias for a specific option.

Start evaluation with the most important success factors first in case the effort gets cut

short.

Communicate throughout the process. Many good decisions fail when those needing

to support them are not included during the decision making process.

Recognize the difference between the process and repeatedly making the same

decision. A new situation and circumstances make it a new decision

Emotions

Do not ignore emotions, but do not let them keep you from thinking through an important

decision objectively.

Decision regret is wasted emotion. You can't change the past. Look forward. Use new

information to make a new decision.

We are continuously pressured to focus on insignificant, inappropriately urgent, or

low value decisions. Keep breaking it down. Smaller decisions are easier to make.

Our connected decision making model can help

Motivation and inspiration

Not deciding is a decision not to act. Take responsibility and decide, even if it is to

choose to not act now.

Coaches motivate. They are available to help with decision making as well.

Changing a decision:

Good decision making does not guarantee outcomes. The unexpected will happen.

Always be open to new information, and be prepared to make a new decision if it

becomes clear that decision goals and criteria will not be met.

Being committed to a decision means changing slowly. Don't let emotions cause rapid

changes in direction. Require the same (or higher) level of diligence for new

information as when the decision was first made.

Building skills:

Learn about decision traps, biases and mistakes. Knowing about these common errors

makes it possible to avoid them.

Find out about alternative decision making techniques and try applying them to low

risk decisions. Get some practice before you need to make an important decision.

Identify or develop some brainstorming techniques that can be used to generate

decision alternatives.

Play games that simulate life choices. This creates a low risk environment to build the

patterns that can enhance intuition.

Positive outcomes increase when the chances are in your favour. Learn about

uncertainty and risk to improve your likelihood of success.

Intuitive decision making can enhance effectiveness for choices where we have a lot

of experience. Learn where intuition fits best, and decisions where it is best to apply a

more rational analysis.

Decision making skills improve with practice. Don't be afraid to choose.

Values: It is difficult to have decisions deliver on what you value if you have not decided

what they are.

Values last. So should your most important decisions. Consider short and long term

consequences when you choose.

Be careful of assumptive language and influencing. If others are making your

decisions, you are living their values, not yours. Take responsibility for your choices.

Seeking information and avoiding overload

Distinguish fact from interpretation. A large amount of the information we use in decision

making is laden with interpretation that can bring up emotions that can lead to poor choices.

Find decision making tools that can help address the cognitive overload that comes from

information that is doubling every three years. The best tools will accelerate information

collection by reusing knowledge gained from related and similar decision making efforts.

Examine assumptions. Decision criteria and information important to a choice can

often be hidden in the assumptions.

Cross-check information with independent third parties where practical. Consider an

outside opinion. An alternative viewpoint can expose biases that may be affecting the

decision making effort.

It doesn't require an expert. Consulting a friend or colleague that has made the same

decision will likely provide valuable insight.

Additional information gathering comes at a cost. Try to determine in advance what

information will best inform your choice to limit the data gathering effort.

Do the research. Effective decisions require reliable information

7. CONSENSUS DECISION MAKING

It is a group decision making process that seeks the consent, not necessarily the agreement, of

participants and the resolution of objections. Consensus is defined by Merriam-Webster as,

first, general agreement, and second, group solidarity of belief or sentiment. It has its origin

in a Latin word meaning literally feel together. It is used to describe both the decision and the

process of reaching a decision. Consensus decision-making is thus concerned with the

process of reaching a consensus decision, and the social and political effects of using this

process. Consensus should not be confused with unanimity or solidarity.

Objectives:

As a decision-making process, consensus decision-making aims to be:

Agreement Seeking: A consensus decision making process attempts to help everyone get

what they need.

Collaborative: Participants contribute to a shared proposal and shape it into a decision

that meets the concerns of all group members as much as possible.

Cooperative: Participants in an effective consensus process should strive to reach the

best possible decision for the group and all of its members, rather than competing for

personal preferences.

Egalitarian: All members of a consensus decision-making body should be afforded, as

much as possible, equal input into the process. All members have the opportunity to

present, and amend proposals.

Inclusive: As many stakeholders as possible should be involved in the consensus

decision-making process.

Participatory: The consensus process should actively solicit the input

and participation of all decision-makers.

8. INDIVIDUAL DECISION MAKING

Good decision making is a skill to be learned and mastered, especially for leaders who are

managing a team. More importantly, individuals must also practice being good decision

makers since it is not advisable to be too dependent on others for personal decisions. The

downside of being too dependent on others is that you might have a hard time standing on

your own two feet when a situation would require you to make a choice without anyone’s

help. A better way to deal with it is to consult friends or trusted people who can advise you

on the kind of decision you are about to make. They can give you tips, suggestions and

warnings before you implement it. This way, you are still on your own in arriving at a final

decision.

9. CATEGORIES OF DECISION MAKING

There are three broad categories of decision making processes, rational and intuitive.

Rational: These are by far and away the most common and when many people think of

decision making, they typically consider some kind of rational model. The general idea here

is to weigh up the pros and cons, and work out the most sensible, logical option. There are

usually a series of steps involved and these are done one after the other. These models often

involve plugging information into a graph or chart. This information usually includes facts as

well as assumptions. And the scoring method is designed to produce the optimal decision.

Bounded rationality: Bounded rationality is the idea that in decision making, rationality of

individuals is limited by the information they have, the cognitive limitations of their minds,

and the finite amount of time they have to make a decision. It was proposed by Herbert

Simon as an alternative basis for the mathematical modelling of decision making, as used

in economics and related disciplines; it complements rationality as optimization, which views

decision making as a fully rational process of finding an optimal choice given the information

available. Another way to look at bounded rationality is that, because decision-makers lack

the ability and resources to arrive at the optimal solution, they instead apply their rationality

only after having greatly simplified the choices available. Thus the decision-maker is

a satisfice, one seeking a satisfactory solution rather than the optimal one. Simon used the

analogy of a pair of scissors, where one blade is the "cognitive limitations" of actual humans

and the other the "structures of the environment"; minds with limited cognitive resources can

thus be successful by exploiting pre-existing structure and regularity in the environment.

Intuitive: The main category is the intuitive model. These models do not depend on reason

and logic. The choice is reached usually by an intuitive 'knowing' of what the best answer is.

People talk about 'feeling it in their gut', 'listening to their heart' and receiving visions or

hearing voices. Other methods of decision making such as astrology, crystals, tarot cards, a

roll of the dice, could also be considered to be intuitive models. They are not based on reason

and rationality; rather they are tapping into some inner wisdom.

10. DECISION MAKING TOOLS AND TECHNIQUES

Oftentimes, people really have a difficult time deciding and choosing between or among

options. Indecisiveness is not something innate. An indecisive person can master the art of

good decision making. One way to make this happen is to apply a practical technique when

making decisions.

The various tools and techniques of decision making are very helpful in teaching people how

to become quick and smart decision makers. There are so many of these decision making

tools and one can choose any of these techniques which seems applicable and useful for the

situation.

Here are some of the common tools and techniques used by people in decision making:

Cost/Benefit-Analysis

A tool that allows the decision maker to simply compare the costs with the benefits of

something

SWOT

The acronym stands for Strengths, Weaknesses, Opportunities and Threats. It is a very useful

and effective tool for various situations in businesses and organizations wherein the strengths

and weaknesses are identified as well as the opportunities and threats in order to arrive at

sound decisions.

Pareto-Analysis

This tool is useful in focusing on major causes for changes that will bring about huge benefits

to the decision maker.

Stepladder-Technique

The technique works by managing the entry or admission of members in a decision making

group. It encourages every member to contribute ideas and alternatives to the group.

Starbusting

Starbursting is a process of gaining knowledge on new ideas through brainstorming but the

focus is more on the questions and not on the answers.

PMI

PMI tool is used for arriving at quick decisions that do not quite have problems. The acronym

stands for Plus, Minuses, and Interesting points.

11. STRATEGIES IN DECISION MAKING

When the need for a decision is caused by a problem or an issue, potential solutions may be

presented but only one option will be chosen. In the process of narrowing down the options to

get to the most feasible choice, there are strategies in doing so.

Optimizing

In this strategy, the most practical solution or alternative to the problem is chosen from

among the list of possible alternatives. There are factors to be considered in optimizing:

significance of the problem

time availability

cost involved

accessibility of tools and resources

personal values and beliefs

Satisficing

The term came from the combination of “satisfactory” and “sufficient.” This strategy is done

by choosing the first satisfactory option over the best alternative.

Maximax

Maximax means “maximize the maximums” which is a decision making strategy that openly

takes risks because the approach is choosing the alternatives based on their highest potentials

and most favourable outcomes.

Maximin

The term is a combined form of “maximize the minimums.” In contrast to the maximax

strategy, the decision maker settles for the alternative with the highest minimum payoff for

failures or negative outcomes.

12. HOW TO MANAGE AND OVERCOME MENTAL SHORTCUTS TO DECISION

MAKING

What makes decision making difficult? Is it the inability of the person to take the decision or

is it something more than that? To answer these questions will be the chief aim of this paper.

Decision making requires not just an idea about what to decide but also the ability to tackle

the inherent obstacles present in everyone’s mind. Decision making is not something which

can be taken lightly. At each stage of life, there will be some decision or the other that one

must take. Take for example a child. Even the child takes plenty of decisions. May be the

nature of decision making and its impact is not that big, but eventually every person goes

through this process of making a decision at every stage of life.

Overcoming the mental obstacles in decision making is not that easy because the mind goes

through a lot of thought processes while taking a decision. It is not just about taking some

decision at that moment and forgetting it. Decisions once taken are mostly of permanent

nature and so it is important that the decision once taken is of the highest standard. Because

of this, there is fair amount of pressure inside every person to take a good decision. This

decision must not just think about the past happenings or the present moment, but it must take

into account all future consequences that could affect the person involved in taking the

decision and all those who will experience the impact of this decision.

So to manage all the mental obstacles in taking the right decision, it is necessary to manage

and overcome mental shortcuts in decision making. Now, what do mental shortcuts mean? It

is about how well a person involved in taking a decision deals with all the mental thoughts

that decides the fortune of the decision. Mental shortcuts must be managed properly so that

proper decisions are made at the right instant. Let us discuss as to how one can manage

mental shortcuts.

Mental shortcuts are about dealing with emotions that one undergoes during the decision

making process. Emotions play a big role in taking a decision. So one must know how to deal

with it. But how does one do that? It’s all about doing a lot of self-analysis and thinking

about the decision. Talking about the self-analysis part, one needs to know what he/she

derives out of the decision. Self-analysis plays a crucial role because a decision once made

cannot be reversed. The impact of the decision on one’s own self is the most important aspect

of decision making. It is not that the decision’s impact on others is negligible, but then the

mind is tuned in such a way that everyone puts self before others.

Now, how does one decide which is best for him in terms of the decision that he/she makes?

This is where self-analysis plays an even bigger role. One must not just think about his/her

present needs, but also give importance to the future requirements. There are a few decisions

made just to satisfy the present needs that future concerns related to the consequences of the

decision are usually neglected. This might give temporary pleasures, but then when a

problem arises in the future, there is every possibility that one might regret the decision that

was taken. So to avoid all that, it is highly essential that the person is confident of taking a

decision. He/she must know the problems that might arise in the future. How to tackle any

problem that might arise in the future must be carefully analyzed based on the present

scenario. Many people fail to make good decisions because either they don’t analyze the

problems that might arise in the future or they don’t think about the solutions to the problems

believing that future is uncertain and hence need not be given much importance. The fact is

even though future is uncertain; there are certain things that are clear. It may not be

predictable to minute details, but then a rough idea of what could happen could always be

outlined. Based on this, one could subject his/her decision to analysis. How well would this

decision analysis be accurate is not what must think about. But an analysis is required so that

he/she can be confident in pursuing with the decision that was made. This, in turn, will help

make the decision be more successful than what it could have been had it not been subjected

to analysis.

Now, here comes the real test of character. A decision once made must stand the test of time

and for this, stern belief on what has been decided must be there and there must be no fear

what so ever in facing the consequences of the decision if any. Why should there be no fear?

Fear can be termed as a nuclear chain reaction happening within us. When it is within

controllable levels, it helps to perform well, but if it exceeds the limits, it decelerates the

performance. To eliminate fear is another tedious process but instead what can be done is one

must be prepared mentally to face any problem that comes along the way. This mental

preparation requires some pre-knowledge of what would happen and for all this, a thorough

analysis of the decision is required. This gives a clear idea as to how the mental shortcuts

must be managed.

13. CREATIVITY IN DECISION MAKING

Creativity in decision making is an asset which very few of us possess. A decision may look

ordinary many a time in life because it lacked the creativity part. What can creativity do to

decision making? Creativity in decision making helps a person who took the decision to

enjoy proceeding with the decision he/she took. It is more of enthusiasm to pursue the

decision rather than compulsion to do it just because some decision was taken. This is what

makes creativity an essential aspect of decision making and every one of us must ensure that

we try our best to be creative in our decision making.

Now the common question that arises is how to be creative in making decisions especially

when most decisions are taken instantaneously under a lot of pressure. True character and

mental strength of a person is exhibited only at distress times and pressure situations. So if

one learns the art of being creative in such situations, he/she has mastered the art of living.

Not every day will one have to face such situations, but whenever one has been made to face

such crisis situations, it is highly essential that a good creative approach is adopted and the

problem neatly tackled. All these depend on how well a person is in creative decision

making.

How it is that one can develop this creativity? There’s nothing like developing creativity.

Everyone possesses creativity in some form or the other and so it is about how one brings out

creativity underlying in him/her that differentiates him/her from the rest. Every person in the

world is blessed with the art of being creative. Not everyone feels so, a few who feel that

don’t show interest in using it to their potential and few others don’t consider creativity as a

big deal. The rest who are very few in number realize their dreams by extracting the

creativity in them to the optimum level and thrive in crisis situations.

Creative decision making is in all fields, but it can be clearly visualized in sports. People who

lead a team may have to be creative and sometimes take crucial decisions based on their

intuitions and these people are usually very successful. Creativity in any decision one takes is

essential. As explained, there’s nothing like developing creativity in one self, it only needs to

be brought out of every one. Now how can this be done? This again requires thorough self-

analysis. Everyone needs to find out where they are good at and what aspects most attract

them. Even the person who is termed the dullest head will have some extra ordinary skill in

him. It is the inability to understand where that skill lies that makes him look dull headed to

the external world. This causes the person to feel that he/she doesn’t have the innate

creativity skills that other people possess. But this is not true. It is essential that self-analysis

is done to identify the innate skills. Only that can make him/her a very successful person.

Similarly, it is up to the individual to try and make sure that he/she is creative in all decisions

that is made.

To get the best creative skills in a person, self- analysis must be accompanied with intense

training whereby one gets a chance to shape his skills and tune them to make sure they are

more creative and match high standards. This training requires a lot of hard work and so only

those who are willing to really dig their skills succeed. This is the reason why not everyone

becomes a good decision maker and only the people who possess the will power to do it

achieves it.

Process of creativity techniques:

Creativity is very essential to enhance creative problem solving. There are various

such techniques involved:

Shifting a person’s mind state from an idle one to a creative one

Reframing the problem

Trying to increase the quantity of fresh ideas

All these creative techniques involve identifying what the problem is and cracking the

problem by finding out a proper solution. Problem solving is not about the problem involved,

but it is more minds related. How the Mind perceives the problem determines the magnitude

of the problem and not the problem in itself. So it is essential that the problem is given the

weightage it deserves and nothing more than that

Creativity in problem solving would involve a creative mind to carefully tackle the problem.

It is also essential to make sure that more fresh ideas are thought about relating to the

problem and all those are properly implemented. It is a problem solving technique which is

independently created rather than learned with assistance. Creativity requires newness or

novelty as a characteristic of what is created, but creativity does not necessarily imply that

what is created has value or is appreciated by other people. A frequent approach to teaching

creative problem solving is to teach critical thinking in addition to creative thinking, but the

effectiveness of this approach is not proven. As an alternative to separating critical and

creative thinking, some creative-problem-solving techniques focus on either reducing an

idea's disadvantages or extracting a flawed idea's significant advantages and incorporating

those advantages into a different idea.

A frequent approach to teaching creative problem solving is to teach critical thinking in

addition to creative thinking, but the effectiveness of this approach is not proven. As an

alternative to separating critical and creative thinking, some creative-problem-solving

techniques focus on either reducing an idea's disadvantages or extracting a flawed idea's

significant advantages and incorporating those advantages into a different idea.

Creative-problem-solving techniques designed to efficiently lead to a fresh perspective that

causes a solution to become obvious. This category is useful for solving especially

challenging problems. Some of these techniques involve identifying independent dimensions

that differentiate (or separate) closely associated concepts. Such techniques can overcome the

mind's instinctive tendency to use "oversimplified associative thinking" in which two related

concepts are so closely associated that their differences, and independence from one another,

are overlooked.

14. COMMON DECISION MAKING MISTAKES

To some, decisions may be easy to reach while other people cannot easily make up their

minds on certain things. Decision making is a skill that requires constant practice. Once you

are faced with a situation, you are forced to decide what is best for you or for others. Some

decisions have to be made instantly and quickly; other kinds of decisions are analyzed before

getting rolled out. Yet, human as we are, we commit mistakes, and even with decision

making, we encounter pitfalls. These slip-ups are inevitable especially when the situation is

little complex.

A mistake must be taken positively instead of allowing it to put you down. Any fault in

decision has to be accepted gracefully and constructively. It is utterly important to learn from

these mistakes and not commit them the next time around. Part of becoming a good decision

maker is gaining understanding of your own mistakes and learning from them.

15. AVOIDING DECISION PITFALLS

If your weakness is being indecisive, you have got to change that personality. Poor decision

making skills actually make one weak and dependent. There is a great tendency that you

cannot stand on your own and may even struggle when left alone.

One simple tip is to defer the decision for the time being. Hasty decisions may turn out to be

bad. Pressuring oneself to decide when the mind is not well-conditioned will also generate

bad decisions. Take time to analyse and really weigh the pros and cons of the choices.

In connection with the first tip, always research and evaluate the choices available. The more

information you gather, the easier it is for you to narrow down your alternatives and

eventually make the best decision.

Lastly, when worse comes to worst, do not hesitate to consult with a friend or an advisor

perhaps. Yet, never completely ask them to make the decision. Simply seek for their opinions

and what they can say about your chosen alternative. This leaves you being independent as a

decision maker.

16. THE FUTURE OF DECISION MAKING: LESS INTUITIVE, MORE EVIDENCE

Human intuition can be astonishingly good, especially after it's improved by experience.

Savvy poker players are so good at reading their opponents' cards and bluffs that they seem to

have x-ray vision. Fire-fighters can, under extreme duress, anticipate how flames will

spread through a building. And nurses in neonatal ICUs can tell if a baby has a dangerous

infection even before blood test results come back from the lab.

The lexicon to describe this phenomenon is mostly mystical in nature. Poker players have

a sixth sense; fire-fighters feel the blaze's intentions; Nurses just know what seems like an

infection. They can't even tell us what data and cues they use to make their excellent

judgments; their intuition springs from a deep place that can't be easily examined. . Examples

like these give many people the impression that human intuition is generally reliable, and that

we should rely more on the decisions and predictions that come to us in the blink of an eye.

This is deeply misguided advice. We should rely less, not more, on intuition. Here's some of

what we've learned:

It takes a long time to build good intuition. Chess players, for example, need 10 years of

dedicated study and competition to assemble a sufficient mental repertoire of board

patterns.

Intuition only works well in specific environments, ones that provide a person

with good cues and rapid feedback. Cues are accurate indications about what's going to

happen next. They exist in poker and firefighting, but not in, say, stock markets. Despite

what chartists think, it's impossible to build good intuition about future market moves

because no publicly available information provides good cues about later stock

movements. Feedback from the environment is information about what worked and what

didn't. It exists in neonatal ICUs because babies stay there for a while. It's hard, though, to

build medical intuition about conditions that change after the patient has left the care

environment, since there's no feedback loop.

We apply intuition inconsistently. Even experts are inconsistent. One study determined

what criteria clinical psychologists used to diagnose their patients, and then created simple

models based on these criteria. Then, the researchers presented the doctors with new

patients to diagnose and also diagnosed those new patients with their models. The models

did a better job diagnosing the new cases than did the humans whose knowledge was used

to build them. The best explanation for this is that people applied what they knew

inconsistently — their intuition varied. Models, though, don't have intuition.

It's easy to make bad judgments quickly. We have a many biases that lead us astray

when making assessments. Here's just one example. If I ask a group of people "Is the

average price of German cars more or less than $100,000?" and then ask them to estimate

the average price of German cars, they'll "anchor" around BMWs and other high-end

makes when estimating. If I ask a parallel group the same two questions but say "more or

less than $30,000" instead, they'll anchor around VWs and give a much lower estimate.

How much lower? About $35,000 on average, or half the difference in the two anchor

prices. How information is presented affects what we think.

We can't know tell where our ideas come from. There's no way for even an experienced

person to know if a spontaneous idea is the result of legitimate expert intuition or of a

pernicious bias. In other words, we have lousy intuition about our intuition.

17. CONCLUSION

In a nutshell, decision making is a core criterion to lead a successful life and every one of us

must realize the importance of decision making. Creativity in decision making is essential for

efficient problem solving and so it is essential that this trait is developed within each of us.