Understand Heuristics to Improve your Decision Making

Decision making – is it mind over matter?

How can we decide?

Use heuristics to make decision making easier
Decision making can be difficult, so use heuristics to help

German psychologist, Gerd Gigerenzer, identified ‘heuristics’ as tools for smart decision making in times of uncertainty. Allied to intuition, he argues, it is the subconscious mind which decides what our choice will be, given the overwhelming number of options available to us.

What are heuristics?

Heuristics are an efficient, cognitive process, conscious or unconscious, which tend to ignore part of the information available to us. This saves time and effort when making decisions. Some believe that this implies a greater degree of error than those decisions made by ‘reason’. They will ask when the rational models are not being met, “which heuristics are being used in which situation? (for there are many)” and “when should people rely on a given heuristic rather than on a complex strategy to solve problems?

Gigerenzer reviewed research, testing formal models of heuristic inference, including those in business organisations, healthcare, and legal institutions. This research indicated that individuals and organisations often rely on simple heuristics in an adaptive way. By ignoring part of the information, we are led to more accurate judgements.

How heuristics sway your decisions?

Big business uses these filter methods, becoming adept at marketing that will urge us to make a decision in their favour. Usually by adding an option which the mind will have to dismiss. For example:

a) overwhelming in choices to be made

b) not at all useful when compared to the other choices

Dan Ariely explains this in more detail in his video:

Check-in with intuition

Even if we are sure our reasonable analyses have led us to the best decision, it is still worth checking on our intuition before we act – that warm feeling or tingle when something ‘feels’ right. If not, the unconscious can “sabotage” anything which does not sit comfortably with us. Since the unconscious mind is the arbiter over what decisions we make, we would be wise to be open to collaboration with it. If we assume that the body is made up of millions of intelligent cells, we can ask our subconscious to assist us in coming to a decision.

An unconscious collaboration

Try this technique when you have one of two choices to make:

  • Stand with your feet shoulder width apart
  • Hold out your hands, palms upwards, as if you are receiving a gift
  • Now visualise each choice, one in the left hand, the other in the right
  • State to yourself: “This option in my left hand is the right course of action”
  • If the hand raises slightly, it is indicative of a positive response. If it drops, the option is negative
  • Then do the same with the other hand.

You now have a decision based on intuitive responses. This can also work if you stand upright and imagine a light passing through the top of your head and down the spine.

  • Think of situation #1 and state to yourself “this option will serve me in the best way”
  • If you have visualised clearly, the body leans forwards (yes); backwards (no)
  • Do the same with option #2

This is how the unconscious can support a decision. These are valuable additions to our repertoire of skills in effective decision making. They can boost productivity and performance. Whereas we may have procrastinated before in uncertainty, now we have techniques to help us choose with greater confidence.

3 Fundamentals of Great Managers

Its all about the people focus

Management of your business has one crucial focus – people. It’s all about people.

The great leaders and the business gurus know this. They coach their business forward with the energy they invest into others. Leaders who struggle tend to spend too much unnecessary time putting out fires. Staffing problems and individual issues can swamp a business with poor efficiency, inconsistent productivity and bad performance.

Each of these critical areas stems from the inability to understand and empathise with others. Try following the three fundamentals below to maximise the people focus in your business.

1) Empathy

See the role from their shoes. Discover what they expect. Generally, people want more of what they have, whether it be financial rewards, recognition, a new office or a better life balance. There are so many variables, so as a leader your default position should be empathy. Be sincere and curious with it and watch a transformation. Consider – how can your business provide that one unique ingredient that activates the individual?

Empathy is an essential management fundamental
Work closely with your team by showing empathy

2) Listen, and then listen some more

Just look at all that interference going on inside our heads:

  • Our agenda
  • Our wants and needs
  • That dreadful sense of urgency
  • Questions
  • Frustration/impatience – at everything we cannot control

Stop thinking – when you listen, listen to the whole. Observe body language and tone. Identify key repetitive words. To get onto the same ‘wave length,’ reflect what is said – sincerely. Talk about their interests, perceptions and visions.

Most people want to do well at work, so they will need to experience wins, small and regular. It is this motivation which can provide infinite energy. A manager who has a keen interest in others is a leader who celebrates the individual’s success, and because of this the employee typically enjoys working harder and longer.

3) Accountability

Setting defined responsibilities and objectives is an excellent gauge to consolidate the previous two points. The key is regular intervention. This is determined by the nature of your business, and of your staff, but monthly catch ups can be extremely effective, especially if the environment is ambitious and heavily target driven.

Regular catch ups are important for managers
Schedule regular catch ups to maintain motivation

Below are just some of the advantages that regular contact on a 1-2-1 basis can provide:

  • Monitor and assess individuals directly
  • An opportunity to uncover issues
  • Ability to offer praise and additional support
  • Check motivation levels and perceptions
  • Target efficiency, productivity and performance

Though not a comprehensive list, it is a great start to re-energise yourself, your staff and your business. The only question is… when do you want to start?