Thursday, January 10, 2019

Decisive by Chip and Dan Heath

Chip and Dan Heath are brothers who are also co-authors. They have written several books about behavioral economics, including one focused on decision making called (unsurprisingly) Decisive. While many books tackle how to improve your life, this book is the best that I have read that specifically focuses on the decision making process. They proceed by looking at factors that lead to poor decisions, how to optimize deciding, and dealing with the uncertainty that accompanies any significant decision.

They start the book off by defining what they call the four villains of decision making: narrow framing, confirmation bias, short-term emotion, and overconfidence. Narrow framing makes you miss options. Confirmation bias leads you to gather self-serving info. Short-term emotion tempts you to make wrong choice (optimize for short-term instead of long-term). Overconfidence gives you unrealistic expectations of the future. They recommend countering these with WRAP method:

  • Widen options to avoid a narrow frame. 
  • Reality test your assumptions to avoid confirmation bias
  • Attain distance before deciding to overcome short-term emotion (10/10/10 Rule)
  • Prepare to be wrong to avoid overconfidence

The framing of a question as "Whether or not" to do something is a sign of a narrow frame. One must consciously consider opportunity costs. To fight this, consider the vanishing options test: you cannot pursue any of the options you are currently considering. Then what would you do?

Another approach to avoid a narrow frame is to consider multiple options simultaneously. This has to be tempered against adding in too many options. One can risk 'decision paralysis' by looking at too many choices; likely only one or two more options are needed.

Most problems are not truly novel. Humans tend to encounter similar problems over time. Instead of focusing on what makes your situation unique, look at what it has common with problems others have faced. Find someone who has solved your common problem. Look at competitors for best practices. Look at your past successes for "bright spots." Look for local analogies, then broaden the problem to look for regional analogies. Then ladder up, broadening analogies over time, to find more solutions.

Inverting the problem and considering the opposite is also a useful approach. Instead of arguing about who was right, ask: What would have to be true for this option to be the right answer? This switches the frame from arguing/defending to analyzing. The search for disconfirming info seems thoroughly negative, poking holes in your argument or others, but what if our least favorite option were actually the best one? What data might convince us of that? In a group setting if dissent is not looked upon favorably, this helps make it seem like you are problem solving.

One can also set a 'tripwire' that triggers team to look at issue again later. Ask for specific disconfirming info. The best question to ask to discover the truth was: "What problems does [the product / situation ] have?" because it signaled confidence and experience in the asker. However, in situations with a clear power dynamic (e.g. Doctor-Patient), the doctor is better asking open-ended questions. Confirmation bias affects not only the questions asked, but what is noticed in the first place.

Decisions in relationships can be even more challenging due to the emotions involved. In a troubled marriage, labeling the other's shortcoming becomes self-reinforcing, making the shortcomings easier to spot and positive acts unnoticed. Cognitive Behavioral Therapy (CBT) founder Aaron Beck recommends couples keep a "marriage diary" of things that their partner does that pleases them. Assume positive intent. When you assume negative, you are angry. Assuming positive intent, you do not get defensive; you try to understand and listen because at your core, you feel like "Maybe they are saying something to me that I'm not hearing."

Sometimes stepping back from the problem is also helpful. You need to seek out 'outside view' of people who have experience in similar situations. An expert here is simply someone with more experience, not necessarily someone with a particular title or status. But be careful what you ask. Ask for base rates of success, not a particular prediction. The more detail you give, the better The authors refer to the Japanese term Genba, meaning the real place, or more loosely the place where the action happens. To decide,  you need detailed info from the scene, which helps reveal nuances that are not visible in the numbers. Zooming out is taking the outside view. Zooming in is taking a close up of the situation that can help inform our decision.

Once you have a sense of the scope of the problem, the authors introduce the idea of "ooch." To Ooch means to test an idea with a series of small experiments before fully committing ("Ooch before you leap"). We are bad at making specific predictions about the future. Applied base rates are better than expert predictions. "The best way to predict the future is to build it." This approach is not a panacea though: Ooching is lousy for situations that require commitment (e.g. whether to get married) but great for something like trying a new gym.

You are your own worst enemy when it comes to decision making. Specifically, your emotions. What happens when your future self disagrees with the decisions of the present? One way to mitigate this bias is the 10/10/10 Rule: How will you feel about decision in 10 minutes? Months? Years? By imagining yourself looking back at the present, you may be able to step out of some of the short-term emotions driving your actions. We analyze differently when thinking about others, so thinking about the future slightly shifts the frame so that you are thinking about you, but as a separate notion. We see the forest for others, the most important factor, but get stuck in the trees of many variables for ourself
Another way to put it: "What would I tell my best friend to do in this situation?" Short term emotion can make us both too quick to act but more often leads to delay because we focus too much on complexity.

None of this matters though if the decision is not in line with your core values. The goal of the WRAP process is not to neutralize emotion but rather to reveal what truly drives you in the long run
This is ultimately an emotion question speaking to passions, values, and beliefs. There's no rational machine underneath -- it's just who you are and what you want. The buck stops with emotion. Define and enshrine your core priorities. Create a "stop doing" list of activities to avoid. An extreme suggestion by the authors is to create an hourly timer to check if you're staying on task for the thing you most should be doing during that hour. Establishing core priorities is not the same as honoring them. One must clear out non-essential tasks to focus on core priorities

As the decision-making process proceeds, not enough time is spent envisioning the range of possible outcomes. The future is not a single scenario to predict but rather a range. Estimate a dire and rosy scenario (not necessarily best and worst outcomes). People using prospective hindsight, thinking deductively from a certain future, are better at generating explanations for why that outcome occurred. The author introduce the idea of a "premortem" - imagine the idea you had failed, then figure out why. To a lesser degree, one should also consider a "preparade" - to prepare for outsized success.

At some point after deciding though, one should set a tripwire. The tripwire is a combination of a deadline and a metric that causes you to reassess whether the path you are on is the right one. Tripwires do not minimize decisiveness but rather encourage risk taking because they create a safe space for experimentation. Tripwires can be especially useful when change is otherwise gradual.

Instead of viewing decisions as a singular up/down type decision, they are better viewed as a spectrum. Compromise / bargaining is valuable in and of itself as a way to limit risk by including a diversity of opinions. Bargainers come to the table with different options which helps the group dodge a narrow frame. Bargaining takes more time up front, but yields buy-in for a more durable solution. Not everyone will end up happy, but if those who lose consider the process fair, more likely to be okay with it.

What does one mean by 'fair' though? The authors define two forms of justice to address this issue. Procedural justice is a system in which the process of making a decision was just. Distributive justice is a system concerned with whether the spoils of a decision are divided up fairly. People feel better about outcomes where procedural justice was followed.

To enact procedural justice, listen, use accurate information, give people chance to challenge incorrect info, apply principles consistently, avoid bias and self interest, explain why decision was made, and be candid about risks / concerns. You need to be able to argue other side's position as well as they can to show that you truly understand and the decision is reality-based. The authors state,  "That's what a good decision process looks like. It's not a spreadsheet that spits out "the answer" when we plug in numbers. It's not a tallied list of pros and cons. It's a guardrail that guides us in the right direction."

A process provides confidence, which lets you quiet your mind because you know you made the best decision you could. Trusting the process gives you the confidence to take risks. Over time, people regret things they didn't do, regret hesitating, and regret being indecisive. Decisiveness is way of behaving, not an inherited trait. Better to try and fail than to delay and regret


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