3 Easy Ways to Make Better Decisions

(by Adam Vaccaro)

Pushing decision-making down the corporate ladder to employees can be a hallmark of good management. But consider this finding from a recent study: 53 percent of people would prefer to flip a coin and “randomize” a decision than to make one themselves.

The paper, “Flipping a Coin: Theory and Evidence,” by three German academics, also reports that 28 percent of the study’s subjects were liable to change their mind about a preferred outcome if asked twice. The responsibility that comes with making a choice, the authors say, can just be too much.

To the authors, this indicated the power of regret in the apparently common problem of responsibility aversion. They write:

Our proposed explanation for the choice of randomization is fear of regret from taking the wrong decision. The decision-maker feels less regret if [a] bad choice is due to a random outcome.

If indecisiveness is a problem at your company, you can use these three strategies to help get better at pulling the trigger.

1. Get rid of fear.

Easier said than done? Maybe. To actually make it happen, check out consultant Doug Sundheim’s advice on the HBR Blog Network for eliminating fear of failure from any organization:

  • Define smart failure
  • Reward smart failures
  • Make your approach to risk-taking transparent

2. Realize that life ain’t fair.

The study’s authors cite previous studies in suggesting that that some people prefer to have their choices made for them because they fear their decision will be seen as unfair. They’re right. A good decision maker uses his or her best judgment and takes in supporting insight and data, but it’s their decision and therefore inherently unfair. Recognizing this reality is an important step toward empowering people to make decisions.

3. Force the issue.

This advice comes from behavioral economist Dan Ariely. When battling indecisiveness, he says, deadlines can only help. Using the example of a group of friends wondering what to do on a given night, Ariely says:

To overcome this problem, I would set up a rule that limits the amount of time that you are allowed to spend searching for a solution, and I would set up a default in case you fail to come up with a better option. For example, take a common good activity (going to drink at X, playing basketball at Y) and announce to your friends that, unless someone else comes up with a better alternative, in 10 minutes you are all heading out to X (or Y).

To be sure, Ariely’s example features a decision of little consequence. It’s probably safe to say experiments like this are probably left better off alone when it comes to choices that could have a significant effect on the future of your company.


Posted From: http://www.inc.com/adam-vaccaro/how-to-make-better-decisions.html?cid=homesub1

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