DECISION MAKING

TIPS AND TRAPS

HAROLD MAY B. TAYAOAN

PRMSG-MGM
DYNAMICS AND TECHNIQUES IN DECISION MAKING
PROF. HEHERSON F. MARAYAG
Improve outcomes using
Decision Making Tips
Improve outcomes using these Decision Making Tips

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)
 Delegating lower value decisions that can be made
by others
Improve outcomes using these Decision Making Tips

Decision Timing. The best decision timing is

achieved when the value of a decision is maximized

Characterize the success factors or goals for the

decision as the minimum information that must be
gathered.
Significant emotions can be involved that will
motivate choosing too early or too late.
Give preference toward choosing sooner if
information gathering and analysis efforts appear to
be delaying clear benefits.
Improve outcomes using these Decision Making Tips

Process. A process can help reduce many of the

biases and thinking errors that commonly occur
when choosing.

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.
Determine alternatives before gathering data.
Improve outcomes using these Decision Making Tips

Emotions
Feeling a lot of emotion regarding a decision? Sleep
on it or add a little delay before choosing. Do not
ignore your 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.
Improve outcomes using these Decision Making Tips

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.
Improve outcomes using these Decision Making Tips

Changing a Decision
Good decision making does not guarantee outcomes.
The unexpected will happen.
Being committed to a decision means changing
slowly. Don't let emotions cause rapid changes in
direction.
Improve outcomes using these Decision Making Tips

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.
Identify or develop some brainstorming techniques
that can be used to generate decision alternatives.
Improve outcomes using these Decision Making Tips

Values
Have you chosen your core 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.
Improve outcomes using these Decision Making Tips

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.
Examine assumptions. Decision criteria and
information important to a choice can often be
hidden in the assumptions.
Consider an outside opinion. An alternative
viewpoint can expose biases that may be affecting
the decision making effort.
Hidden Traps in
Decision Making
 Hidden Traps in Decision Making

The Anchoring Trap

When considering a decision, the mind gives
disproportionate weight to the first information it
receives. Initial impressions, estimates, or data anchor
subsequent thoughts and judgments.
 The Anchoring Trap

What to do about it?

 Always view a problem from different perspectives.

 Think about the problem on your own before
consulting others in order to avoid becoming
anchored by their ideas.
 Be open minded.
 Hidden Traps in Decision Making

The Status-Quo Trap

A strong bias toward alternatives that perpetuate the
status quo.
 The Status-Quo Trap

What to do about it?

 Always remind yourself of your objectives and

examine how they would be served by the status quo.
 Never think of the status quo as the only alternative.
 Avoid exaggerating the effort or cost involved in
switching from the status quo.
 Hidden Traps in Decision Making

The Sunk-Cost Trap

Another of our deep-seated biases is to make choices
in a way that justifies past choices, even when the past
choices no longer seem valid.
 The Sunk-Cost Trap

What to do about it?

 Seek out and listen carefully to the views of people

who were uninvolved with the earlier decisions and
who are hence unlikely to be committed to them.
 Examine why admitting to an earlier mistake
distresses you.
 “When you find yourself in a hole, the best thing you
can do is stop digging.” by Warren Buffet.
 Hidden Traps in Decision Making

The Confirming-Evidence Trap

This bias leads us to seek out information that
supports our existing instinct or point of view while
avoiding information that contradicts it.
 The Confirming-Evidence Trap

What to do about it?

 Always check to see whether you are examining all

the evidence with equal rigor.
 Get someone you respect to play devil’s advocate, to
argue against the decision you’re contemplating.
 Be honest with yourself about your motives.
 Hidden Traps in Decision Making

The Framing Trap

The way a problem is framed can profoundly influence
the choices you make.
 The Framing Trap

What to do about it?

 Don’t automatically accept the initial frame.

 Try posing problems in a neutral, redundant way
that combines gains and losses or embraces different
reference points.
 When others recommend decisions, examine the way
they framed the problem.
 Hidden Traps in Decision Making

The Overconfidence Trap

Over- confident about our accuracy that can lead to
errors in judgment and, it turn, bad decisions.
 The Overconfidence Trap

What to do about it?

To reduce the effects of overconfidence in making

estimates, always start by considering the extremes,
the low and high ends of the possible range of values.
This will help you avoid being anchored by an initial
estimate.
 Hidden Traps in Decision Making

The Prudence Trap

The form of over cautiousness, or prudence. When
faced with high-stakes decisions, we tend to adjust our
estimates or forecasts “just to be on the safe side.”
 The Prudence Trap

What to do about it?

To avoid the prudence trap, always state your

estimates honestly and explain to anyone who will be
using them that they have not been adjusted.
Emphasize the need for honest input to anyone who
will be supplying you with estimates.
 Hidden Traps in Decision Making

The Recallability Trap

Frequently base on predictions about future events on
our memory of past events, can be overly influenced by
dramatic events—those that leave a strong impression
on our memory.
 The Recallability Trap

What to do about it?

To minimize the distortion caused by variations in

recallability, carefully examine all your assumptions to
ensure they’re not un-duly influenced by your
memory.
Get actual statistics whenever possible. Try not to be
guided by impressions.
Reference:
Harvard business review • September–October 1998,
The Hidden Traps in Decision Making by John S.
Hammond, Ralph L. Keeney, and Howard Raiffa