Do you like making decisions? This week I’m going to build on the framework I constructed in last week’s post to discuss a few common mistakes people make in their decision processes. If you haven’t, it might make sense to read last week’s post before this one. Also, one disclaimer before I start: I don’t want to tell you how to live your life. When I write about mistakes, I’m usually not talking about a “correct way to live” or “the path to happiness” or anything like that. I’m merely talking about situations where your actions might not fit your intentions. This is what makes them objective mistakes, but only under the premise of your intentions. People are complicated and have a variety of goals so there’s no general rules, not even on the meta level of decisions regarding their decision process. Still, most probably never consciously think about this, which is why I’m writing these posts.
So, what are goals you might have with regard to your decision process? The most obvious one is probably correctness. Out of all the options that were available to you (not only the ones you explored) you want to pick the one that is best for you according to your personal values. Another obvious one is efficiency. You want the decision process to consume as little resources as possible. These two goals are probably universal, but they are obviously in conflict with each other. So this is the most important knob you can turn in your decision process. For each decision, you have to weigh the cost of the decision against the quality of the decision. This is where the first mistake can be found that many people make: they spend a lot of resources if the decision is difficult, paying too little attention to how important it is. If there are many possible options where the outcome is nearly equally valuable to you, the decision becomes difficult. But this also means that it is pretty inconsequential. No matter which option you pick, the outcome will be almost identical.
A popular example of this is an experiment that is often discussed in this context. If someone offers you a scoop of free ice cream and lets you decide on the flavor, it doesn’t really matter which one you pick as long as it's a flavor you like. The outcome will be nearly identical: you’ll enjoy a nice scoop of ice cream. But the researchers conducting this experiment split their subjects into two groups. One got only a small number of options to choose from, the other group had a very large number of options. They asked the subjects after eating the ice cream how happy they were about their decision and found that those who had fewer options were happier on average than those in the other group. If people had been investing as little resources into the decision as its gravity would afford, the number of options shouldn’t matter. But what actually happened is that those people who had more options invested a lot more effort into the decision making process, inflating their expectations for the outcome.
This nicely leads us to a third criterion you might optimize your decision making process for which many people are unaware of. Namely, how satisfied you will be with the decision you made. Note how this is different from the quality of the decision which is about objectively picking the best option. This is an orthogonal concept. You can pick the best option you could have picked and still think it was the wrong one. On the other hand, you might have picked a largely suboptimal option and still be very happy about it. Last week I said that the filtering part of the decision making process is the most emotionally exhausting part, because it's where you need to convince yourself that the option you will pick is the correct one. This becomes more difficult the more resources you have already invested in the process. If you spent a considerable amount of thought on the decision, you expect exceptional results. In the end, the people who are unhappy with the ice cream they picked are not really unhappy with the ice cream, they are unhappy about the amount of resources they wasted on the decision. Most of them will not know this.
So assuming you want to optimize for how happy you will be with your decision when someone offers you a free scoop from any of 50 flavors of ice cream. The worst you can do is look at them all. Because the exploration part is where the complexity explodes. All these options have to be simulated and filtered. The devious part is that these researchers make the exploration so easy by waving the options right in your face. But what you should be doing is realize that 50 flavors is so many that it will probably include any flavor you could fancy. So the best thing you could do is close your eyes and think: “if I could have any ice cream right now, what would I want?”. This will activate your subconscious which will give you an answer that, according to recent research, might actually be inspired by your gut microbiome, if you can believe that. The way our gut is connected to our subconscious is wild. But anyways, you might have some microbes in your gut that say “we haven’t had mango in a while”. So you just ask the person offering you the ice cream. “Do you have mango?” and the answer is probably yes. So it’s almost not a decision at all. The story becomes “I fancied some mango ice cream and someone just gave me some” instead of “damn, I could have had lychee but I was so stupid to choose cashew instead because it sounded interesting”.
But this strategy shows an interesting dilemma: you probably always want to be happy about your decisions, but only if they were actually good. You don’t want to run around making terrible decisions, even if you are super happy about them. For really consequential decisions, you do want to invest the effort and be confident about the quality of the outcome. Otherwise you’ll just be unhappy with your life while being happy with your decisions, so you’ll just blame everyone else. That’s the classic fate of people who optimize too much for being happy about their decisions. If that’s your habit, the only way to mitigate it is to consciously think about the gravity of your decision and ask yourself if it was “too easy”. At least assess how important the decision is before making commitments. Because the importance of a decision is a pretty abstract concept, a good proxy is “how long will I have to look back at this decision?”.
For example, it is a common practice of salespeople to try and rush your decision process. Given what we looked at earlier, this might even be a good thing but it can also be a very bad thing. It all depends on how much money is involved and what that money means to you. If a guy at an ice cream shop tells you “just get white chocolate macadamia, that’s the best one” and that sounds good to you, take it. Be happy that he took the burden of decision away from you. But if someone tells you that you only have today to decide if you want to buy a certain car (and you’re not so rich that buying a car isn’t a significant investment), be very careful. It’s probably better to pass on that opportunity because it’s likely that there are better options, otherwise they wouldn’t have to rush you like that. Unless, of course, you already spent a lot of time looking at cars and can say with confidence that it is a good offer.
I could go on, but this post is already quite long again. I hope it was at least a little helpful to you and helps you think more consciously about your decision processes. I can definitely say that writing it down felt useful. Most of it probably isn’t radically new to anyone, but at least for me, structuring it helped a lot.
