Business owners make consequential decisions on a regular basis. Some decisions can forever alter the trajectory of a business. How can we improve our decision making?
Reflect on your past year of decision making. Which decision was your best? Which was your worst? Odds are that you identified your best decision as the one that generated the best result, and you identified your worst decision as the one with the worst result.
This human predilection is called “resulting.” Resulting stands as a significant obstacle to improved decision making. Until we recognize and accept that good decisions have nothing to do with the result, and everything to do with the process, we will continue to wallow in mediocre decision making.
Resulting fails to account for the significant influence that random chance and luck have on all the outcomes of all our decisions. In the preceding exercise, hardly anyone identifies a well-reasoned decision that resulted in a poor outcome due to chance.
But chance and luck play significant factors in human life and the outcome of decisions. No reasonable person thinks getting home safely after driving drunk reflects either a good decision process or good driving ability. Even while driving sober, every time we cross an intersection without getting T-boned, we experience good luck.
We can make the best possible decision (achieved via a thorough and well-reasoned decision process) at every point and still experience an unwanted result due solely to chance.
If we are to improve our decisions, we must increase our awareness of uncertainty and integrate it into our decision process.
Preventing us from doing so is our cultural bias against admitting that we don’t know or we are not sure. People like to give confident answers to boost their self-image as a competent individual.
However, the best decision makers are comfortable with the world being an uncertain and unpredictable place. They embrace uncertainty and instead of focusing on becoming sure of an answer, they focus on trying to figure out how unsure they are.
To make a decision, we must form a belief about how the future will unfold and then select the action we believe is best suited for that future. One powerful way to integrate uncertainty into our decision process is to think probabilistically.
Too often we think of our beliefs as either correct or incorrect. However, no belief is either 100% correct or 0% correct. Life and business are much more nuanced. The illusion that our beliefs are either right or wrong causes us to engage in incomplete decision making processes. We are unlikely to consider as much information as objectively as we need to if we think our beliefs are simply correct.
When we integrate uncertainty into the process, we can begin expressing our confidence about a belief in terms of probability. When we can say that we are 80% confident of something, several things happen.
One positive outcome of such a paradigm shift is that we instantly become more credible. Someone who expresses less than 100% confidence signals that they are genuinely seeking the truth. Another positive outcome that improves our decision making process is that expressing ourselves probabilistically also invites other people to be our collaborators. They realize they can contribute to the discussion without implying that we are “wrong.”
When we invite collaboration, we invite additional information into our decision process that we would most likely not have considered. When we think of ourselves as 70% correct, we are also more likely to seriously consider the additional information contributed by our collaborators.
Try this out for yourself. The next time you are faced with a decision, consider the beliefs and assumptions that frame your decision process. Then consider that you are most likely not 100% correct about those assumptions and beliefs. Invite feedback from collaborators. Seriously consider that feedback from the perspective that integrating the new information most likely improves your decision process.
Then when evaluating the result of the decision, be sure to account for the role that chance played in it before concluding whether you made a good decision or not. When you start evaluating your decisions based on the quality of the process instead of the quality of the outcome, you walk the path of improved decision making.
At Chiumento Dwyer Hertel Grant, our goal is to remove as much chance as possible from your legal situation, putting the power in your hands to achieve your desired outcome. Choose Chiumento. Contact us now.