Making Better Decisions: 5 Practical Methods to Create More Choices

There are myriads of ways that our auto-response brain systems lead us to bad decisions…I described 18 ways in my previous article, and that only scratches the surface. Our own mind works in mysterious ways that often lead to illogical decisions. What are reliable practices for overcoming mental biases and shortcuts so that we can make consistently good decisions?

The Irrational Brain Obstacle

Even very smart experts in decision-making can be pessimistic about finding any surefire cure for the biases of our minds. Human brains are quick to make judgments in a reactive thinking system, which behavioral economist Daniel Kahneman calls System 1 in his epic work Thinking Fast and Slow. The higher, or “executive” level of thinking, System 2, which might help to overcome the biases or shortfalls of System 1, is much slower to process information, and often too lazy to counter the lower level system.

Here’s the problem—When we have a situation requiring a decision, we start with a “hunch” from the fast-acting System 1 based on information immediately available.  Even if we engage the more deliberative, analytical System 2, we too narrowly focus on evidence that confirms our hunch. We are masters at deceiving ourselves by filtering out counter evidence. We also selectively remember our past experiences, making up coherent, but not necessarily true, stories to explain how things turned out after we already know results. Kahneman told one podcast host “The stories about the past are so good that they create an illusion that life is understandable, and they create an illusion that you can predict the future.” That makes us too overconfident in our ability to foresee the future and succeed. Kahneman concedes that biases are “deep, and they’re powerful, and they’re hard to change.”

This video gives a brief summary of the System 1 & 2 concept from Thinking Fast and Slow

So, is there hope for making better decisions? Authors Chip and Dan Heath labelled four villains of rational, effective decision-making in their book Decisive. These villains – Narrow Framing, Confirmation Bias, Short-Term Emotion, and Overconfidence—are often subtle and not always recognized by ourselves.

The Heath brothers contend that we can wrestle with these villains, suggesting several techniques in their book, which categorizes the counter-villain strategies into four areas with the mnemonic acronym WRAP:

• Widen Options
• Reality Test Assumptions
• Attain Distance
• Prepare to Be Wrong

In addition to Heaths’ framework, a growing number of other authors have tackled the decision-making problem with their own techniques, including Cheryl Strauss Einhorn’s work Problem Solved: A Powerful System for Making Complex Decisions with Confidence and Conviction, and Jennifer Riel and Roger L. Martin’s Creating Great Choices: A Leader’s Guide to Integrative Thinking. In the following series of articles, I will discuss practical decision-making techniques from various sources for making better choices.

Step One: Playing on the Right Field, Headed Toward the Right Goal

The first step to improved decision-making is to decide on the right thing, with the right criteria. This may sound obvious, but we often gloss over the bigger picture of what we really want to accomplish. Without a clear goal and an idea of what it looks like when we successfully reach that goal, we risk missing other paths that could get us there–or worse, making decisions toward an irrelevant goal. Decisions need to fit our overall strategy, and strategy is about making a choice of “where to play and how to win,” as articulated by renowned business thinker Roger L. Martin.  So, the first thing to ask is “Am I making a decision on the right playing field, and in the right position on the field?” “Is this a decision about something that fits into my larger goals or purpose?” (For personal decisions, see this article for tips on writing a Life Purpose Statement).

It’s important to identify the “Critical Concepts” of the decision that really matter to you, according to Cheryl Einhorn in Problem Solved. Are there any conditions that are absolutely essential to consider the outcome as successful? For example, if you’re considering what kind of a car to purchase, is it a deal breaker if you can’t fit a family of four with a load of camping gear?…or is it essential to be economical? It simplifies the decision-making process to keep the essentials in mind.

Step Two: Open Up Possibilities

Step two is to explore a reasonable amount of options to get you to that goal—what Chip and Dan Heath label “Widen Options.” They provide five methods to help present more choices:

• avoid simple binary decisions
• eliminate options
• multi-track
• learn from others to develop a playlist
• use analogy

Method 1: Avoid Binary Choices (Unless They Lead to More Choices)

Business researcher Paul Nutt conducted a study on 168 decisions made by various corporate teams, and found that a mere 29% even considered an alternative choice—theirs was a binary “do this or don’t do this” choice. He further found that 52% of those types of decisions failed, while adding one or more alternatives lowered the failure rate to 32%.

When we focus on a decision with a simple “whether to do this or not,” we are prone to miss the opportunities available if we had included other choices. What we give up by choosing one thing over another is called an “opportunity cost” in economics. So, if faced with a seemingly binary decision on “whether or not” to expand a product line, we can open up possibilities by considering what opportunities would be lost by that expansion.

A different type of binary decision–not “whether or not,” but “this or that”– can have a positive aspect. In Roger Martin’s idea of integrative thinking, he proposes a method of setting up two extremes of a choice, purposely holding them in tension with one another. Exploring the points that we like about each extreme, and looking for possibilities to achieve those through another solution, helps us break out of the either-or quandary. In one seminar, Martin gave an example of a successful solution to his problem as Dean of the Rotman School of Management at the University of Toronto. Faced with a common academic institutional dilemma of whether to be a teaching or a research facility, he directed the team to a solution that captured desirable outcomes of both choices. The school focused on research, but with important conditions that integrated teaching: they required every professor to teach students in what they were researching…and only in their research field. This meant narrowing the course offerings, but it also meant that the researchers were passionate about what they were teaching. The results were both productive research, and more engaged students.

Method Two: Eliminate Options

Authors Adam Morgan and Mark Barden show us how constraints can actually inspire creative decision-making. In their work A Beautiful Constraint: How To Transform Your Limitations Into Advantages, and Why It’s Everyone’s Business, they see constraints as “catalytic forces that stimulate exciting new approaches and possibilities.”

The “Vanishing Options” method of expanding our decision framework is a type of “beautiful constraint.” It simply means to take away what you perceive to be options to a tough decision that isn’t yielding a satisfactory solution. It’s like a magician who keeps making doors disappear in front of you. For example, if you are trying to decide on whether or not to close down an underperforming branch location, take away the option of closing it. This forces us to expand beyond the mental bias that Daniel Kahneman identified as “What You See Is All There Is.” That is our common practice of giving too much importance to information that is easily available to us. Constraining our choices shifts our attention to other factors and solutions that might be buried beneath the easy or obvious.

Method Three: Multi-track

The multi-track method involves multiple teams working separately on the same problem, but from different angles, or one team working simultaneously on multiple solutions to a problem. In the first example, a marketing firm has shown extraordinary success in naming brands by having multiple teams simultaneously explore multiple avenues. In the second example, graphic designers were tasked to create an online advertisement. One set of designers was told to work sequentially on the ad, with five rounds of feedback and revision. The other set were to work simultaneously on three ads, which would be evaluated and reduced to two ads that they would improve, which in turn would be reduced to the final ad after review and revision. Although both groups worked on a total of six ad versions and received feedback for improvement, the designers who worked on more than one ad at a time produced more effective ads, as judged by the client company and click-through rates.

Multi-tracking expands options, and can help keep egos and company politics in check—with multiple options being explored at the same time, it’s harder for people to become too invested in one idea. Concentrating on a single idea, even if it’s to evaluate the positive and negative aspects, makes us vulnerable to one of the subtler and more powerful mental biases—loss aversion—which makes us feel losses twice as strong as gains.  If we come to feel “ownership” of a single idea, we will want to keep it, even if another option comes along that has more to gain.

Method Four: Learn From Others and Make a Playlist

There’s no shortage of information available to us today. And, as an ancient philosopher once said, there’s nothing new under the sun. Innumerable case studies of just about every type of problem that has faced a company or individual are available with a Google search. In larger organizations, we might also find that some other section within the company has found a “best practice” solution to a problem similar to what we face. To break out of the narrow frame of solutions, then, we need to research and apply the relevant stories.

The Heath brothers advocate using the analysis of previous experiences to make a “playlist” of “managerial greatest hits: questions to ask, principles to consult, ideas to consider.” I recommend making these “playlists” from conducting regular, systematic reviews of decisions and how they have turned out. Based on the practice of debriefing I used in flying aircraft to constantly improve skills, it’s important to take time to reflect after each decision cycle—starting from how the decision was framed and made, how it was communicated, how it was put into practice, to finally analyzing the effects, both intended and unintended. An example would be reviewing and drawing principles from the inevitable round of budget cuts that come with economic down cycles. Examine how, where, and who made the decisions. Was that process effective and efficient? How effectively were the decisions communicated to others, and could that process be improved? How faithfully to the plan were the decisions put into action, and what could be improved?

In fact, many business-oriented books offer some type of playlist based on the authors’ experiences of “greatest hits.” One relevant example comes from Cheryl Einhorn’s AREA model of decision-making explained in the previously-mentioned Problem Solved. She provides a number of helpful lists of questions based on experience for each step of her model, which she calls “Cheetah Sheets.” (No, not cheating sheets…cheetahs, who have the outstanding advantage of being able to slow down and change direction faster than their prey). For example, she provides a Cheetah sheet in a data-research step focused on numbers, asking what numbers are available, are they reasonable, are they complete, etc.

There’s one caveat, however, with using the past to analyze and solve our problems: relying on past solutions almost never leads to innovation. Roger Martin argues in a podcast interview about strategy, “To the extent that you analyze in order to determine what to do, you are making a gigantic enormous assumption. And that assumption is the future will be identical to the past…to the extent that you make strategy an analytical exercise, it will drive out innovation entirely.” Dr. Martin advises “The only way to innovate is to use a different process…which is imagining possibilities, and then choosing the one for which…you can make the most compelling argument.” Nonetheless, to the extent that problems can be categorized, it is worthwhile to review our past decision processes and develop general lessons learned and guidelines.

Method Five: Use Analogy

The final method that Chip and Dan Heath propose in countering the Narrow Frame villain is quite similar in nature to making a playlist, as it involves extracting the essential elements of one situation to apply them to another. An analogy is a comparison between two similar things—seeing the essence of how both things work or exist, and then using the comparison to discover useful principles for solving problems. The more un-alike the two things are, the more difficult it is to find a meaningful comparison, but also the higher value of the overarching principle that you discover.

The Decisive book gives an example of a school leader who would like to improve the cafeteria’s performance in serving children so that they would waste less time in queuing in line. The analogy starts within the cafeteria, by looking at which cashiers in the cafeteria might be more efficient. From there, the analogy stretches outside of that cafeteria, to other cafeterias in other schools—still very similar. The analogy gets stretched by making comparisons first to other types of check-out lines, until it could be made at a very high level in such areas as fluid dynamics—how liquids flow through constricted areas, for example. Going from very similar to very different to draw out principles is called “laddering up.” The analogies made at the top of the ladder, though the most difficult to solve, promise the greatest reward of usefulness in diverse situations.

Coming Next: Disconfirming Confirmation Bias

These five methods —

• avoid simple binary decisions
• eliminate options
• multi-track
• learn from others to develop a playlist
• use analogy

all work to help us break out of the narrow frame that is set up by System 1’s fast reacting system. They cause us to pause and reflect on more options, to engage System 2, so that rather than think “either…or…” we can think “yes, and…” The next set of methods deal with a most insidious villain that we encounter almost every day: Confirmation Bias. In the next article, I will explore ways to beat our own brain when it tries to filter out things we should know to make better decisions.

Copyright © 2018 by Robert Cummings. All rights reserved.