Good decisions will always result in good outcomes, and I was wrong.
Good decisions will always result in good outcomes, and I was wrong.
First, I have long believed that good decisions will result in good outcomes, and I am wrong.
Second, I believed it is simple to decide provided we have the necessary facts at a decent confidence level. I didn’t realize this is not true for all. Some of us get confused with the availability of more information and will do anything to avoid deciding. We don’t realize that no decision is a decision in itself.
Third, we make logically sound decisions, no that is not always true, and we make irrational decisions most of the time.
Three aspects of decision-making that I needed clarity,
- How to make good decisions and not have regrets?
- How do we help others decide for themselves?
- Why do we make irrational decisions that defy logic?
and so went down the rabbit hole of understanding decision-making.
Three themes were recurring Psychology, Behavioral Science, and Communication from the list of books. I will try to codify the information and notes from these books over several posts.
Let’s start with the first insight.
Insight #1 — Good decisions can have bad outcomes; bad decisions can have good outcomes and don’t judge a decision by its outcome.
How is that possible? It is illustrated well with a simple example from the book Foundation of Decision Analysis by Ronald A. Howard and Ali E.Abbas
Here are some more insights from Chapter 1 of the book.
A decision is a choice between alternatives and decisions are difficult because they required trade-offs.
Decision-making with uncertainty — We would like to choose the best alternative given our preference by properly considering uncertainty.
What then is the Decision Analysis?
The purpose of decision analysis is to enable a decision-maker to achieve clarity of thought, and knowing we have made a good decision provides peace of mind since that is all we can do to influence the future.
Ratan Tata once said, “I don’t believe in making right decisions. I take decisions and then make them right”. Any decision is a prediction about the future, and the prediction is always uncertain, so the best way is get decisions right is to configure your actions according to your choice of decision.
One thing that helps not to have regrets in hindsight is to realize that the information available during a decision and after outcomes are known is not the same.
