Ways to Overcome Bias and Make Better Decisions

Jonah Lehrer writes frequently on psychology, neuroscience and learning. He has a fascinating piece about how people, even smart people, often make simple mistakes when addressing very rational based questions. Here’s an example:
A bat and ball cost a dollar and ten cents. The bat costs a dollar more than the ball. How much does the ball cost?

The overwhelming majority of people respond quickly and confidently: the ball costs ten cents. This is the obvious answer but it’s also wrong. The correct answer is that the ball costs five cents and the bat costs a dollar and five cents. After hearing the answer, it sounds obvious. so why do so many people get it wrong?

Based in part on the research of Daniel Kahneman, Lehrer explains that when people face an uncertain situation, they don’t always carefully evaluate the information or look up relevant statistics. Instead, they make decisions based on a long list of mental shortcuts.These shortcuts are not a faster way of doing the math; they’re a way of skipping the math altogether. Asked about the bat and the ball, we forget our arithmetic lessons and instead default to the answer that requires the least mental effort. This type of thinking, or the lack thereof, is not limited to word problems, it also takes hold in solving everyday work and life challenges.

Another reason for this type of bad decision making is that there are also certain biases in the human mind that attach to the information we are given. For example, if we are given a random number and then, afterwards, asked to estimate how many X there are in the world, people will tend to group their answer near the random number. Perhaps our most dangerous bias is that we naturally assume that everyone else is more susceptible to thinking errors than we are, this is called the “bias blind spot.”

This bias blind spot is based, perhaps partially on ego, on the fact that most people are great at noticing the flaws of others while overlooking the very same flaw in ourselves. As a result, we don’t srcutinize our decisions on the same level we will scrutinize the decisions of others and therefore we are quicker and more likely to make bad decisions. What’s interesting is that more academically advanced individuals tend to make even more of these mistakes. For example, more than fifty per cent of students at Harvard, Princeton, and M.I.T. gave the incorrect answer to the bat-and-ball question. It could be that the more one is recognized for their thinking ability, the greater the blind spot bias becomes.

Overcoming Barriers to Effective Decision Making, an article in Contract Management magazine provides some tips to better decision making that attempts to avoid shortcuts and biases:

1. Be aware of your biases and short-cut type thinking
2. Review prior decisions to see where these shortcomings are most pronounced
3. Get input from others

In my opinion, while many of these decision making mistakes relate to biases, values and psychology, many others relate to hasty decision making. Don’t jump at an answer, and when making the answer, flip the problem to look at it from another perspective. Then see if your answers align. It sounds trite, but it’s oh so right: Measure twice, cut once.