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Making Better Decisions in Complex Times
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Karen Bowen
www.eqdevgroup.com / www.myeqcoach.com
What Today Is About• Emotions Values & Beliefs • Decision Making Approaches • Bias • Risk
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Understanding Emotion“The process of thinking requires feeling, for feelings are what let us understand all the information we cant directly comprehend. Reason without emotion is impotent.”
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Beliefs & Values
• Beliefs are “Decision Making Filters”
• Values are “Decision Making Lenses”
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“In a knowledge based economy, we propose that a knowledge worker’s primary deliverable is a good decision.”
How Can Decision Making Be Improved? Milkman, Chugh, Bazerman. 2008
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What Is A Decision?
Source: https://www.google.com/search?q=what+is+a+decision
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Common Challenges• Lack of clarity on desired outcome
• Overconfidence
• Moving too fast
• Perceptual Narrowing
• Avoidance
• Information Overload
• Information Underload
• Cognitive Bias
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Complexity
CONFUSION
You are here.
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How We Decide
“Truly successful decision-making relies on a balance between deliberate and instinctive
thinking.” - Malcolm Gladwell
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Two Approaches
• Will research extensively • Will continue to look for new
alternatives even after suitable choices have been identified.
• Will always aim to make the best possible choice.
• Tend to mull over decisions at length. • Are often less content with their
choices after the fact.
Maximizers Satisfiers• Will research only to the extent they
feel necessary. • Will choose an option that they feel is
‘good enough’. • Tend to make decisions more quickly. • Are more content with their choices
(less concerned with alternatives they didn’t choose)
Source: Schwarz – The Paradox of Choice, Wiley, 2005.
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Which Is It For You?
• What do you consider to be some of the advantages of your approach?
• What do you consider to be some of the disadvantages?
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Intuitive/Rational
Adapted from: Starcke and Brand, 2011: Decision Making Under Stress: A Selective Review & Epstein, Pacini, Denes-Raj, and Heier, 1996: Individual differences in intuitive-experiential and analytical rational thinking styles.
Complete Ignorance
(not even possible outcomes are
known)
Certainty (only a single
outcome is known to result)
Risk (The outcome
probabilities are specified)
Ambiguity (The possible outcomes
are known, but their probabilities are not)
More Intuitive ExperimentalMore Intuitive / Experiential
More Rational / Analytical
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Exploring the YOU in Decision Making
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Cognitive BiasesA systematic error in thinking that affects decisions and judgments.
Cognitive biases may sometimes lead to perceptual distortion, inaccurate judgment, illogical interpretation, or what is broadly called irrationality.
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Bias Blindness…
“…these are not just occasional errors in judgment but rather routine mistakes, barriers to logic we stumble over time and
again, repeating patterns through generations and through the centuries. For example, it is much more common that we overestimate our knowledge than we underestimate it.”
- Rolf Dobelli
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Cognitive Bias (just a few)• False Consensus Effect • Curse of Knowledge • Reactive Devaluation • IKEA Effect
• Ostrich Effect
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False Consensus Effect
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Curse of Knowledge
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Reactive Devaluation
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IKEA Effect
source: www.sketchplanations.com
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Ostrich Effect
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Decision Based Evidence Making
Evidence Based Decision Making
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Where Does Risk Fit?
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The 8 Risk Types
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Risk Type & Decision Making
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Risk Type in Working Population
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10 Ways To Make Decisions Better
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1.Take Care Of Yourself
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2. Beware Decision Fatigue
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3. Acknowledge The Feeling
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4. Slow Down, or Even Stop
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5. Delegate What You Can
Tannenbaum & Schmidt (1973)
Use of Authority by Leader
Area of Freedom by Subordinates
Leader Centered Subordinate Centered
Leader permits subordinates to function within defined limits
Leader makes and announces
decision
Leader sells
decision
Leader presents ideas and
invites questions
Leader presents tentative decision
subject to change.
Leader presents
problems, gets suggestions,
makes decision
Leader defines
limits; asks group for decision
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6. Seek Support
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7. Seek (Some) More Information
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8. Discuss Decisions
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9. Make More Decisions
“Be willing to make decisions. That’s the most important quality in a good leader. Don’t fall
victim to what I call the ‘ready-aim-aim-aim-aim’ syndrome. You must be willing to fire.”
T. Boone Pickens
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10. Learn From Your Successes (and Mistakes)
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LinkedIn: • Karen Bowen • Drew Bird
Email: • [email protected] • [email protected]
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