Fortune 75 – Make Better Decisions! – FORTUNE – Page

Nine decision-making pitfalls—and nine simple devices to beat them.
By Michael Useem and Jerry Useem

All in all, our decision-making equipment is pretty sound. We don’t follow the lead lemming over a cliff. We can’t be fooled into thinking a 99-cent lure is a full meal. We don’t try to catch car fenders with our teeth. Then again, it wasn’t a dog who launched New Coke. So there are obviously a few bugs-little design flaws in the mind-that can have big consequences.

People are clinically overoptimistic, for instance, assigning zero probability to events that are unlikely but not impossible (such as a massive iceberg in path of a really big ship). We see “patterns” in the random movements of stocks, just as people once saw bears and swordsmen in the scatterplot of the nighttime sky. We make choices that justify our past choices and then look for data to support them. We not only make these errors; we make them reliably.

That’s the good news. Predictable errors are preventable errors. And a few simple techniques, like the nine below, can help you steer clear of the most common wrong turns.

Problem Analysis Paralysis A less than ideal action, swiftly executed, stands a chance of success, whereas no action stands no chance. Cure “decidophobia” with the 70% solution. Read more….
Problem Sunk-cost syndrome It’s always painful to destroy something we’ve built, whether it’s a machine, an organization, an idea, or even a paragraph. But the cliché holds: no pain, no gain. Burn the boat. Read more….
Problem: Yes-man echoes Need some honest input? People can’t line up blindly behind you if they don’t know where you stand. Voice questions, not answers. Read more….
Problem: Anxiety overload A panicked mind stops processing new information and often makes things worse. When all the other gauges are spinning wildly, look at the clock. Read more….
Problem: Warring camps Political infighting can be destructive, but battles over substance, managed well, can be constructive. Let the battle rage. Read more….
Problem: A wily adversary How did the New England Patriots figure out Peyton Manning? They cloned him. Read more….
Problem: To be? Or not to be? When our rational brains tie us in knots, our natural preferences sometimes express themselves in nonrational ways. When all else fails, go with the omen. Read more….
Problem: Inexperience When should you go with your gut? Blind instinct cannot be trusted–but it can be trained. Educate your instincts. Read more….
Problem: Self-interested thinking Even when we want to, it’s hard to separate a company’s interests from parochial ones. So ask yourself, What would Sara Lee do? Read more….