how to make better decisions

We make hundreds of decisions every day, at work and home, for the simplest and most complex of tasks. The downstream impact of those decisions can be hugely positive or damagingly detrimental. In a world where we have vast amounts of data at our fingertips, it pays to invest more time in understanding how to make better decisions, leading to better outcomes. Here are some tried and trusted ways to get sound decisions made.

Gather the right people, and let them speak freely

Diversity of knowledge leads to diversity of insight. Equally too many cooks spoil the broth. Establishing clear governance and having transparency around who should be consulted and who has the final say, is critical. Without this, decisions are often kicked down the road or escalated, or recycled, or all of the above. Having the right combination of people in the room will also generate a richer understanding of the issue at hand, and consequently a more nuanced solution. But establishing clear decision rights and sending out a calendar invite to the right people is only the first step. You need to foster a culture in which everyone knows their thoughts are valued, whether or not they are in line with the group consensus. Constructive challenge should be welcomed, not avoided.

Take a step back and challenge cognitive biases

Any decision-making process is riddled with opportunities to fall foul to cognitive biases. Have you ever struggled to let go of the first idea that popped into your head? Or based an entire decision on one statistic? Awareness is your greatest defence and there are strategies that can help. To overcome confirmation bias, try searching for dis-confirming evidence. To avoid overconfidence, try hypothesising why an idea might be ineffective. To combat groupthink, try assigning someone to be devil’s advocate for a meeting.

Some cognitive biases are harder to shake off than others. When you feel yourself digging in, try considering the issue from a different perspective. Ask yourself questions such as:

What would I do if my favourite option was no longer available?

Five years down the line, my favourite option has been ineffective. Why might that be?

If I were replaced tomorrow, what would my successor do about my dilemma?

This kind of self-questioning can unearth important considerations and exciting revelations. 

Harness the power of data – but don’t follow it blindly

As businesses embrace the age of big data, leaders must determine how to harness that data. While technology such as AI is infinitely better than humans at analysing data, there is other relevant information to be considered that cannot be captured by a computer. For many decisions the sweet spot exists where the computer interfaces with the data, and where humans interface with the computer-generated insights. Always remember though, while computers are more resistant to cognitive biases than humans, they are not immune.

Digital twins are an exciting frontier of AI-technology and human decision making. They are simulations that work in real time to monitor a device, system, or process, and can be used to predict when a specific part in a machine might fail. General Electric uses this technology to alert maintenance workers to potential problems before they become serious, and provides them with information so they can make an effective decision. Machine and human working together to achieve the best outcome.

In summary

Making better decisions begins with a commitment to evaluate your decision-making structure. Recognise the cognitive biases that affect your thinking and implement circuit breaks to get you back on track. But perhaps more importantly, foster an environment in which employees know their voices are valued, both when they are agreeing and disagreeing with the people around them.

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