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4 Habits of Bad Decision Makers
4 common mistakes that can trip you up
- Monumentalizing the Trivial. Place a limit on how long you're willing to spend addressing the issue. When the time ends, make your choice and move on.
- Dredging Sunk Costs. Estimate how much the decision would take in total to follow through. If the cost is higher than the benefit, change your decision.
- Drowning in Data. Identify less than 10 pieces of relevant data that will have a strong impact on your decision's outcome. Then forget everything else.
- Do-or-Die Mentality. Realize that every decision is temporary. Use an overall decision-making strategy that stretches over time, not that imagines each moment to be the most critical one for the business.
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Making decisions
Decision making is critical for entrepreneurs. Every day, you have to set out on a course of action, choose tactics, evaluate results, and otherwise choose from arrays of options.
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Decision-making errors
Most decision-making errors boil down to:
- logical fallacies (over-generalizations, comparing apples and oranges, circular thinking)
- limiting beliefs (underes...
Confirmation Bias
If you already have an opinion about something before you've even tried to figure it out, chances are you'll over-value information that confirms that opinion.
Think about what kinds of information you would expect to find to support alternative outcomes.
Attribution Bias
The “fundamental attribution error,” is when we excuse our own mistakes but blame other people for theirs.
Give other people the chance to explain themselves before judging their behavior.
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Bias is everywhere
Being aware of your own biases doesn't mean you will be free of them. You need a system that will help prevent your proclivities from taking control.
You're not as smart as you think
It wasn't an individual that got people to the moon. It was all of NASA.
There should be recognition of how many people really should be involved and the need for mechanisms to deliver smarter decisions.
There is safety in numbers
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The Art of Decision-making:
- Get 1% smarter every day;
- Focus on things that don’t change or change very slowly over t...
Decision-making cascades
... through everything you do. That's the power of compounding. If you get 1% better at understanding how the world works, how human behavior works, how economic systems function, and understanding your own brain — that 1% improvement impacts everything you do.
Study things that never change
The best kind of knowledge is not ephemeral junk , that will be useless in a few years, but the core pillars of human knowledge and the major academic disciplines. That knowledge changes very slowly over time and it’s a core foundation that you can build upon and grow from.
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