The Heath brothers have never failed to impress me with any topic they’ve tackled so far.
They have this uncanny ability to turn any complex topic into one that’s simple to understand. And their books always allow you to walk away with actionable ideas and strategies that you can apply in your life.
Decisive—a book about fighting cognitive bias and making better decisions—is no different. This book is actionable and inspiring.
Here are my notes from the book.
The four villains of decision making
- The first villain: narrow framing. This is the tendency to define our choices too narrowly, to see them in binary terms.
- The second villain: confirmation bias. Our normal habit in life is to develop a quick belief about a situation and then seek out information that bolsters our belief.
- The tricky thing about the confirmation bias is that it can look very scientific. At work and in life, we often pretend that we want truth when we’re really seeking reassurance.
- And this is what’s slightly terrifying about the confirmation bias: When we want something to be true, we will spotlight the things that support it, and then, when we draw conclusions from those spotlighted scenes, we will congratulate ourselves on a reasoned decision.
- Third villain: short-term emotion. When we’ve got a difficult decision to make, our feelings churn. We replay the same arguments in our head. We agonise about our circumstances. We change our minds from day to day. If our decision was represented on a spreadsheet, none of the numbers would be changing—there’s no new information being added—but it doesn’t feel that way in our heads. We have kicked up so much dust that we can’t see the way forward.
- Fourth villain: overconfidence. People think they know more than they do about how the future will unfold.
- To beat these four villains, you need to follow the WRAP process.
Step One: Widen your options
- What if we started every decision by asking some simple questions: What are we giving up by making this choice? What else could we do with the same time and money?
Vanishing Options Test
- Another technique you can use to break out of a narrow frame is to run the Vanishing Options Test. The conceit here is that Aladdin’s genie has an eccentric older brother who, instead of granting three wishes to a person, arbitrarily takes options away. Below, we give you a generic form of the test, which you can adapt to your situation: You cannot choose any of the current options you’re considering. What else could you do?
- A study of graphic designers demonstrates the value of multitracking. The designers, tasked with making a banner ad for a Web magazine, were randomly assigned to use one of two creative processes. Half of them were instructed to design one ad at a time, receiving feedback after each new design. Each designer started with a single ad and revised it five times based on rounds of feedback, yielding a total of six ads.
- The other half of the designers were instructed to use a “simultaneous” process, so that each one started with three ads and received feedback on all three. Then, in successive rounds, the set was whittled down with further feedback to two ads and then one final ad.
- All of the designers ultimately created the same number of ads (six) and received the same quantity of feedback (five ad critiques). The only difference was the process: simultaneous versus one at a time.
- As it turned out, process mattered a great deal: The simultaneous designers’ ads were judged superior by the magazine’s editors and by independent ad execs, and they earned higher click-through rates on a real-world test of the banners on the Web site. Why?
- The study’s authors, trying to explain the better performance of the simultaneous designers, said, “Since [simultaneous] participants received feedback on multiple ideas simultaneously, they were more likely to read and analyse critique statements side-by-side. Direct comparison perhaps helped them better understand key design principles and led to more principled choices for subsequent prototypes.
- In other words, the simultaneous designers, by multitracking, were learning something useful about the shape of the problem. They were able to triangulate among the features of their three initial ads—combining their good elements and omitting the bad.
- To get the benefits of multitracking, we need to produce options that are meaningfully distinct.
- We must be careful too, to avoid sham options, which exist only to make the “real” option look better.
- To diagnose whether your colleagues have created real or sham options, poll them for their preferences. If there’s disagreement, that’s a great sign that you have real options. An easy consensus may be a red flag.
Find people who’ve solved your problem
- To break out of a narrow frame, we need options, and one of the most basic ways to generate new options is to find someone else who’s solved your problem.
- That’s why we shouldn’t forget, when hunting for new options, to look inside our own organisations. Sometimes the people who have solved our problems are our own colleagues.
- What Dunbar discovered, after countless hours of eavesdropping and interviewing and synthesising, was that one of the reliable but unrecognised pillars of scientific thinking is the analogy.
- And the key to using analogies successfully, he said, was the ability to extract the “crucial features of the current problem.” This required the scientist to think of the problem from a more abstract, general perspective, and then “search for other problems that have been solved.”
Step Two: Reality-test your assumptions
- So how can we learn to overcome the confirmation bias and Reality-Test the Assumptions we’re making? The first step is to follow the lead of Alfred Sloan, the former GM CEO, and develop the discipline to consider the opposite of our initial instincts. That discipline begins with a willingness to spark constructive disagreement.
- In our individual decisions, how many of us have ever consciously sought out people we knew would disagree with us? Certainly not every decision needs a devil’s advocate, but for high-stakes decisions, we owe ourselves a dose of skepticism.
- Another alternative is to seek out existing dissent rather than creating it artificially. If you haven’t encountered any opposition to a decision you’re considering, chances are you haven’t looked hard enough.
Zoom out, zoom in
- Often in life, though, we do the opposite: we trust our impressions over the averages. Strange to think that when we make critical decisions, we do less objective research than when we’re picking a sushi joint.
- Psychologists distinguish between the “inside view” and the “outside view” of a situation. The inside view draws from information that is in our spotlight as we consider a decision—our own impressions and assessments of the situation we’re in. The outside view, by contrast, ignores the particulars and instead analysers the larger class it’s part of.
- It looks for the averages: are there other people who’ve faced a similar situation, and if so, how did they fare? This involves looking for, in statistics terminology, some “base rates” on the situation—data showing the record of other people in similar circumstances.
- The outside view doesn’t require defeatism, but it does require respect for the likely outcomes.
- Perhaps the simplest and most intuitive advice we can offer is that when you’re trying to gather good information and reality-test your ideas, go talk to an expert.
- Here’s what is less intuitive: be careful what you ask them. Experts are pretty bad at predictions. But they are great at assessing base rates.
- The advice to trust the numbers isn’t motivated by geekery; it’s motivated by humility. We can’t lose sight of what the numbers represent: a lot of people like us—full of passion for their opportunities—spent their time trying something very similar to what we’re contemplating. To ignore their experience isn’t brave and romantic. It’s egotistical.
- The humble approach is to ask, “What can I reasonably expect to happen if I make this choice?”
- To ooch is to construct small experiments to test one’s hypothesis.
- Ooching is a diagnostic, then, a way to reality-test your perceptions.
- Ooching has one big flaw: it’s lousy for situations that require commitment.
- Ooching is best for situations where we genuinely need more information. It’s not intended to enable emotional tiptoeing, in which we ease timidly into decisions that we know are right but might cause us a little pain.
Step Three: Attain distance before deciding
- Occasionally, though, we’ll encounter a truly tough choice, and that’s when we’ve got to attain distance.
- In general, the distance we need will be emotional. We need to downplay short-term emotion in favour of long-term values and passions.
- There’s a tool we can use to accomplish this emotion sorting, one invented by Suzy Welch. It’s called 10/10/10. To use 10/10/10, we think about our decisions on three different time frames: how will we feel about it 10 minutes from now? How about 10 months from now? How about 10 years from now?
- Conducting a 10/10/10 analysis doesn’t presuppose that the long-term perspective is the right one. It simply ensures that short-term emotion isn’t the only voice at the table.
Honour your core priorities
- When you strip away all the rational mechanics of decision making—the generation of options, the weighing of information—what’s left at the core is emotion. What drives you? What kind of person do you aspire to be? What do you believe is best for your family in the long run? (Business leaders ask: what kind of organisation do you aspire to run? What’s best for your team in the long run?)
- Without clear priorities to draw on, the decision will be made idiosyncratically, depending on the employee’s mood at the moment. While we can probably tolerate some randomness when it comes to fumbled hot dogs, alignment is critical in many other situations.
Step Four: Prepare to be wrong
- After we’ve made a decision, we must challenge ourselves to consider two questions: how can we prepare ourselves for both good and bad outcomes? And how would we know if it were time to reconsider our decision? In other words, we must Prepare to Be Wrong.
Bookend the future
- Penstock uses a method he called “bookending,” which involves estimating two different scenarios: a dire scenario (the lower bookend), where things go badly for a company, and a rosy scenario (the upper bookend), where the company gets a lot of breaks.
- Penstock’s strategy of bookending is atypical of investors. Many investors, he said, try to make a precise prediction of what a stock is “really worth”. It’s sometimes called a “target price”, and if the target price is higher than the current price, investors decide they should buy. Penstock rejects this kind of thinking. His belief is that computing a precise target stock price reflects a false confidence about the future.
- He said, “It’s my job as an investor to think about the future, but the future is uncertain, so my investments can’t hinge on knowing the future. I look for situations where the bookends suggest that I can invest wisely without knowing exactly what the future holds.”
- We offer the example because we do want to recommend Penstock’s approach to life decisions. His humility about his predictive abilities is critical to making a good decision. What if we, like Penstock, could make wise choices without knowing exactly what the future holds?
- When we think about the extremes, we stretch our sense of what’s possible, and that expanded range better reflects reality. Penstock and other investors use that expanded range to make smart bets on stocks. But the rest of us aren’t betting on the outcome—we’re living it. So we need to be prepared to deal with any outcome between the two bookends we’ve charted.
The premortem and postparade
- The psychologist Gary Klein, inspired by this research, devised a method for testing decisions that he called the “premortem.” A postmortem analysis begins after a death and asks, “What caused it?” A premortem, by contrast, imagines the future “death” of a project and asks, “What killed it?” A team running a premortem analysis starts by assuming a bleak future: Okay, it’s 12 months from now, and our project was a total fiasco. It blew up in our faces. Why did it fail?
- Everyone on the team takes a few minutes to write down every conceivable reason for the project’s failure. Then the team leader goes around the table, asking each person to share a single reason, until all the ideas have been shared. Once all the threats have been surfaced, the project team can Prepare to Be Wrong by adapting its plans to forestall as many of the negative scenarios as possible.
- Our judgment can be wrong in multiple ways. We might err by failing to consider the problems we could encounter, and that’s why we need premortems. However, we might also err by failing to prepare for unexpectedly good outcomes. When we bookend the future, it’s important to consider the upside as well as the downside.
- That’s why, in addition to running a premortem, we need to run a “preparade”. A preparade asks us to consider success: let’s say it’s a year from now and our decision has been a wild success. It’s so great that there’s going to be a parade in our honour. Given that future, how do we ensure that we’re ready for it?”
- One solution to this is to bundle our decisions with “tripwires”, signals that would snap us awake at exactly the right moment, compelling us to reconsider a decision or to make a new one.
- The goal of a tripwire is to jolt us out of our unconscious routines and make us aware that we have a choice to make.
- Because day-to-day change is gradual, even imperceptible, it’s hard to know when to jump. Tripwires tells you when to jump.
- One option is to set a deadline, the most familiar form of a tripwire.
Trust the process
- A process, far from being a drag or a constraint, can actually give you the comfort to be bolder. And bolder is often the right direction. Short-run emotion, as we’ve seen, makes the status quo seductive. But when researchers ask the elderly what they regret about their lives, they don’t often regret something they did; they regret things they didn’t do. They regret not seizing opportunities. They regret hesitating. They regret being indecisive.
- Being decisive is itself a choice.
- Decisiveness is a way of behaving, not an inherited trait. It allows us to make brave and confident choices, not because we know we’ll be right but because it’s better to try and fail than to delay and regret.
- Our decisions will never be perfect, but they can be better. Bolder. Wiser. The right process can steer us toward the right choice. And the right choice, at the right moment, can make all the difference.