Decision-making is a common task yet challenging process— so challenging that we often skip over steps to get it over with. In his masterpiece, Thinking Fast and Slow, economist Daniel Kahneman explores the various mindset mistakes we apply in making decisions.
Kahneman presents over thirty common pitfalls that we make from relationship to business to major life decisions. Anyone who wants to make better decisions or wants those around them to make better decisions, Thinking Fast and Slow, may need to be read.
For any leader who wants to separate themselves from the rest, here are five common pitfalls to avoid and the mindset to embrace when making decisions:
1. Let Go of Your Story and Listen to Others
We thrive and cope in the world by living according to a particular story, system, or set of beliefs. And when we hear competing stories that don’t fit into our own, we tell ourselves an alternative narrative. For example, in life, we tell a story that doesn’t change our own. We say things like “everything happens for a purpose” or “it was an act of God.”
In leadership, if someone garnered success by commanding their team step-by-step, they may conclude that leadership is controlling. And whenever they hear a story of a successful leader or company that is very flat, they may chalk it up to luck. Leadership success can be a potent curse if one’s singular story thinking is left unresolved.
To make decisions well, we must let go of our singular story thinking. We must listen thoroughly to the stories and leadership systems that seem counter-intuitive and nonsensical to us if we are to lead successfully in our ever-changing world.
2. Avoid Small Samples and Look For Big Data
We have small and finite brains. Computing large amounts of data into a coherent story or system can be challenging, if not impossible. To deal with this difficulty, our minds focus on a small sample of data with very positive results instead of a larger and more complex system of statistics presenting something less than ideal.
We can look at a successful marketing effort in leadership and conclude from the sample that the marketing approach applied is the best in any situation. However, when someone comes with a stack of research on how our context was different than it is now, we will likely ignore the new data sets and statistics in favor of the small sample.
To make decisions well, we must avoid sample over statistics thinking. We must always be open to and have the time to review and process new data sets and pivot when necessary.
3. Refrain from Judgment and Believe the Best
Because of our small brains, we tend to also under and overestimate things. For example, if you get in a car accident, you will be much more likely to think car accidents are common than if you never had one. If you think you do 70% of the chores at home, but the other person feels they do as well, someone is under and estimating effort and impact!
In leadership, we can quickly treat our work as our home. We can get caught into thinking that we do a more significant share or proportion of work than the rest of the team. While unbeknownst to us, everyone is thinking the same thing about themselves.
To make decisions well, we must suspend our perception and judgment. We must believe the best in others and only judge others’ decisions with the necessary and complete information.
4. Resist Stereotyping and Focus on the Facts
Usually, we are quite good at making accurate assessments and decisions when given statistics only. The challenge comes when an individual or personal story comes into place. Once we hear a word or experience something personally, related statistics may be thrown out in favor of the compelling narrative.
In leadership, this can lead to stereotyping and profiling. For example, you are entirely supportive of hiring and welcoming someone on to the team because you’ve seen the data that shows anyone, regardless of demographics, can do the job. However, one day you have a very negative personal encounter with a random person from minority demographic X. After this, regardless of the data and statistic, your vision and perception of this group of people will be skewed.
To make decisions well, we must avoid overlooking statistics and giving in to stereotypes. We must focus on the data and base our decision on facts instead of feelings, statistics over stereotypes.
5. Step Away From Tradition and Explore New Worlds
No matter who we are, we’ve grown up in a tradition. This tradition has influenced and impacted how we understand the world and how it works. We developed a theory about how the world works and how it should be lived. And whenever we experience something that doesn’t fit into our theory of how things work, we can easily dismiss it and assume our view isn’t complete— instead of wrong.
In leadership, this can lead to willful blindness. For many of us, we were taught a tradition of paradigms and systems of thinking toward business and leadership. Some of these systems, however, were for a different period. For example, Todd Rose, a Harvard professor, in his book, The End of Average, argues that our relentless pursuit of standardization hinders, if not damaging, our business. He proposes a new way of leading that focuses on individuals’ strengths, passions, and needs.
To make decisions well, we must avoid tradition blindness. We must remain curious and inquisitive, eternal students in leadership and change.
Leading Fast and Slow
In our ever-changing times, outstanding leadership will require thoughtful and slow thinking. We can no longer afford to rely on feelings, stories, simple stats, and tradition. At times we will still need to lead fast, quick, and agile. But long-lasting success and making essential decisions demands us to lead slowly, objectively, and systematically.