Decision-Making

Availability Heuristic: Our Preference for the Familiar

May 27, 2023 By Nagesh Belludi Leave a Comment

Availability Heuristic: Our Preference for the Familiar and Readily Available Information The availability heuristic is a cognitive bias that can lead people to rely on readily available information or emotionally charged and inherently interesting examples when making decisions or judgments. Essentially, individuals tend to overestimate the probability of events that are easy to recall or that they’ve personally experienced, while underestimating the likelihood of less memorable or less frequent events.

In other words, the ease of retrieval of a misleading cue may make people rely on evidence not because it is dependable but because it is memorable or striking and thus psychologically available to them. They may do so even if the evidence is not logically acceptable or does not logically support their decision.

Doctors often depend on recalling their past dramatic cases and mistakenly apply them to the current situation. People may overestimate the crime rate in their community based on news coverage, even though crime rates may be relatively low. People may dismiss the reality of climate change if they’ve recently experienced a cold winter or heard of a cold snap in a particular region, even though global warming is a long-term trend. Individuals are more likely to purchase insurance after experiencing a natural disaster than before it occurs. In each of these scenarios, the vivid and emotional evidence feels more persuasive rather than it being the most accurate or reliable information.

The availability heuristic can also shape people’s perceptions of air travel safety and lead them to believe that flying is more dangerous than it really is. Airplane accidents are often sensationalized and highly publicized by the media, making them more memorable and more prominent in people’s minds. This can cause individuals to perceive the risk of flying much higher than it actually is, leading them to avoid air travel even though it is statistically one of the safest forms of transportation. In reality, many less vivid and less memorable (i.e., psychologically unavailable) things are much more dangerous than air travel, such as falling down stairs, drowning, choking, and accidental poisoning.

Avoid falling prey to the availability heuristic and making serious misjudgments about the risks associated with different situations. Acknowledge that personal experiences and recent events may not accurately reflect the overall reality of the situation.

The Bikeshedding Fallacy: Why Trivial Matters Eclipse the Important Ones

May 26, 2023 By Nagesh Belludi Leave a Comment

The Bikeshedding Fallacy: Why Trivial Matters Eclipse the Important Ones Parkinson’s Law of Triviality, also known as the Bikeshedding Effect, is a mental model that underscores the inclination to place undue emphasis on a simple or easily comprehensible matter while ignoring more significant ones.

The term “bikeshedding” originated from a book by C. Northcote Parkinson (who gave us Parkinson’s Law.) To illustrate the idea of bikeshedding, Parkinson evokes a situation where a cross-disciplinary committee discusses the design of a nuclear power plant. Most of the members have a limited understanding of nuclear reactor design. Consequently, they will likely rely on the experts’ opinions on these critical matters.

However, when the discussion turns to a relatively simple topic like a humble bike storage shed for employees, everyone feels the need to contribute. This is attributable to the people’s desire to be recognized as valuable contributors and showcase their competence by providing their thoughts on something everyone can understand. As a result, the committee spends a disproportionate amount of time deliberating on trivial matters like the shed’s building material or paint color while turning its back on critical issues such as how to foolproof the fuel control system.

In essence, Parkinson’s Law of Triviality highlights the human tendency to focus on easy-to-understand matters, even if they are less important, because individuals feel more confident and productive doing them.

Don’t Hide Bad News in Times of Crisis

April 21, 2023 By Nagesh Belludi Leave a Comment

Don't Hide Bad News in Times of Crisis When a crisis hits, suppressing or obscuring bad news is often an impulsive reaction. Leaders can even exacerbate a crisis if bad news is marginalized, unaddressed, or ignored until it’s too late.

If you don’t frequently communicate with your key constituency, somebody else will. In the absence of honest information, your employees can develop their own perceptions of the problem and its implications.

Idea for Impact: Wise managers recognize the power of transparency and self-disclosure. Speak up early and candidly. If necessary, take a reputational hit today by disclosing problems; it’ll earn dividends. With a candid appraisal, people can turn their attention away from assigning blame to understanding the problem’s nature and helping you develop solutions.

The Upsides of Slowing Down

April 17, 2023 By Nagesh Belludi Leave a Comment

Making faster and faster decisions can look like the proper response in a culture obsessed with speediness and efficiency that bleeds into the reckless and hasty. But as investment banker turned-law educator Frank Partnoy’s Wait: The Art and Science of Delay (2012) argues, while fast thinking—like fast food—hits the spot on occasion, too much speed can, however, be counterproductive.

Today we jump faster and more frequently to firm conclusions. We like to believe there is wisdom in our snap decisions, and sometimes there is. But true wisdom and judgment come from understanding our limitations when it comes to thinking about the future. This is why it is so important for us to think about the relevant time period of our decisions and then ask what is the maximum amount of time we can take within that period to observe and process information about possible outcomes. … The amount of time we take to reflect on decisions will define who we are. … Our ability to think about delay is a gift, a tool we can use to examine our lives. Life might be a race against time, but it is enriched when we rise above our instincts and stop the clock to process and understand what we are doing and why. A wise decision requires reflection, and reflection requires pause.

Resist the Growing Pressure for Faster Decisions

Time pressure, high stakes, and emotionally charged situations make it more likely that we will deviate from rational decisions and fall back on heuristics—caveman thinking indeed. Mental shortcuts may have their place for helping us to navigate quotidian risks like crossing the road or boiling a kettle. However, for every decision that can be made in a moment, there are many others where a considered and judicious approach may save you from calamity.

Idea for Impact: The next time you feel pressured to make a quick decision in the face of the unexpected, try to slow down, take a breath, and ask yourself whether your natural desire to get on with it needs to be tempered with caution.

Knowing When to Give Up: Establish ‘Kill Criteria’

March 27, 2023 By Nagesh Belludi Leave a Comment

Quit: The Power of Knowing When to Walk Away (2022) by the professional poker player and “decision scientist” Annie Duke meditates on how you could become so wedded to some predetermined goals that you don’t reassess your ever-evolving values and priorities based on new information that you may unearth along the way.

Quitting isn’t bad, especially if you’re blindly heading toward a “fixed object goal” that’s perhaps no longer serving your values—even hurting you in some way you didn’t anticipate.

A Mental Model to Help You Cut Your Losses

Duke suggests instituting “kill criteria” in advance. Before a pursuit, ask yourself: what signals you could see in the future would tell you it’s time to quit or change course?

How to Quit Well Using Kill Criteria

Before entering a marathon, for example, you could decide if the medical tent counsels that you’re hitting your physical limitations, you’d quit trying to push yourself and walk out.

In other words, every goal needs a resolute “unless” for every task, investment, and relationship. E.g., if you’re miserable at your job, you could give it three more months and pre-select some indicators that would tell you if things haven’t improved even after you’ve increased your efforts.

Idea for Impact: Know when to give up. Grit is great—but only for carrying on for hard things that are worthwhile. Beware of tunnel vision; don’t get so narrowly focused on a specific goal and overlook other opportunities or priorities.

First Things First

February 27, 2023 By Nagesh Belludi Leave a Comment

First Things First---How to Avoid Procrastination Most people have the disposition to work on easy, accessible, or pleasant tasks while putting off tasks that seem tedious or difficult.

Using minor tasks to put the big tasks on the back burner is a particularly deceptive form of procrastination. You pat yourself on the back for checking items off your to-do list, but all you’ve done is deferred the more critical, time-consuming work until the end.

Sure, you need to exercise, check your Facebook wall, run errands, tidy your desk, catch up with a buddy, and plan your next vacation. But don’t use these activities as excuses for not preparing the progress report whose due date is creeping up on you.

One of the self-help guru Stephen Covey’s familiar 7 Habits of Highly Effective People (1989) is the discipline of classifying essential things that need to be prioritized. Habit 3, “put first things first.”

Idea for Impact: Delaying a critical task hardly makes it easier. When tempted to procrastinate, first catch yourself making an excuse. Don’t let the little necessary tasks trivialize the more substantive work.

How to … Stop That Inner Worrywart

February 22, 2023 By Nagesh Belludi Leave a Comment

How to Stop That Inner Worrywart I’m one of those incessant worrywarts. Risk mitigation is a significant facet of my work. Thus, I worry about the prospect of non-optimal results; I worry about the unintended side effects of my decisions, and I worry about what people aren’t telling me. I even worry that I worry too much (now, that worry is entirely unfounded.)

If, like many people, you’d like to worry less, perhaps you may find the following approaches helpful. Most of my over-worrying comes from thinking ahead, but after a reasonable effort to understand risks and make plans to adapt more flexibly to developing situations, I’ll just let up. I’ll self-talk as though I’m addressing a team, “Not everything is within our control. We’ll cross that bridge when we come to it. Let’s deal with it as it appears and course-correct.” Beyond that, I’ll get really busy with something else that keeps me too occupied to fret about the previous thing that worried me.

How to … Plan in a Time of Uncertainty

January 25, 2023 By Nagesh Belludi Leave a Comment

Planning in a Time of Uncertainty In periods of uncertainty and ambiguity, move away from annual plans and focus on the next three months. Reflect on the unpredictability of the future and stay on your toes by forging plans for unexpected scenarios so you won’t be caught flat-footed when that time comes.

Establish “trigger points” and “accelerate, maintain, or terminate criteria” in advance and keep an eye on key indicators to “wait and see” or “stay the course” should one of your planned-for scenarios materialize.

Idea for Impact: When the horizon is much shorter, operate with agility and allocate your resources in real time.

Our 10 Most Popular Articles of 2022

December 30, 2022 By Nagesh Belludi Leave a Comment

Top Blog Articles of 2022 Here are our most popular exclusive features of 2022. Pass this on to your friends; if they like these, they can sign up to receive our RSS feeds.

Choose a better response. Don’t accept reflexive reactions. Instead, learn to know there is a “space” before responding.
To be more productive, try doing less. The best way to get lots of things done is to not do them at all.
The good of working for a micromanager: be aware of the details your manager cares about and expect to learn a lot.
A hack to resist temptation: commit to not giving in for 15 minutes. Even a simple distraction can break the trance.
Get good at things by being bad first. If you aren’t willing to be bad initially, you’ll never get started on anything new.
Get rid of relationship clutter. Make room for more supportive and nurturing relationships.
Don’t be a prisoner of the hurt done to you. While you are the victim of another who has caused you some suffering, she herself is also a victim of suffering.
Nothing like a word of encouragement to provide a lift. Everyone needs hope. Look for honest ways to offer even a little nudge of encouragement.
The secret to happiness in relationships is lowering your expectations. You’d be happier to accept other people’s difficult behaviors when you expect less from them.
Cancel culture has a condescension problem. If we can’t stand up for the right to speech that we dislike, why keep the right to the speech we do like?

And here are some articles of yesteryear that continue to be popular:

We wish you all a healthy and prosperous 2023!

“Fly the Aircraft First”

December 29, 2022 By Nagesh Belludi Leave a Comment

Attention Prioritization: Lessons from Eastern Airlines Flight 401 Today is the 50th anniversary of the Flight 401 disaster. I’ve previously cited how the crew of the ill-fated Eastern Airlines Lockheed L-1011 got so single-mindedly preoccupied with tackling a nose landing gear indicator light malfunction that they didn’t pay attention to the fact that their airliner was descending gradually into the Florida Everglades.

In summary, the pilots were too distracted to fly the aircraft. Human factors, specifically cognitive impairments, can precipitate distractions away from vital tasks.

The incident led to a breakthrough called Crew Resource Management (CRM.) This “human nature innovation” actively orients pilots to prioritize tasks in order of operational safety. The adage “Aviate, Navigate, and Communicate (A-N-C)” reinforces the ‘fly the aircraft first’behaviors until they’re internalized and become routine.

The top priority—always—is to aviate. That means fly the airplane by using the flight controls and flight instruments to direct the airplane’s attitude, airspeed, and altitude. Rounding out those top priorities are figuring out where you are and where you’re going (Navigate,) and, as appropriate, talking to ATC or someone outside the airplane (Communicate.) However, it doesn’t matter if we’re navigating and communicating perfectly if we lose control of the aircraft and crash. A-N-C seems simple to follow, but it’s easy to forget when you get busy or distracted in the cockpit.

Idea for Impact: “Fly the aircraft first.” Know when to set aside the seemingly important things to accomplish the more vital ones.

Decision-Making

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A Mental Model to Help You Cut Your Losses

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