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TKP Insights: Making (Even) Better Decisions

Oct 25, 2022 1h 23m 22 insights
This episode is packed with wisdom from previous guests on the art of making better decisions.  We discuss the three types of decision-makers, how to control your emotions when making decisions, why it’s crucial to look at every decision differently, the processes for coming to the right decision, and how to learn from your mistakes when you get it wrong. The guests on this episode are author Ventakesh Rao (Episode 7), psychologist, author and professional poker player Maria Konnikova (Episode 89), Stripe co-founder Patrick Collison (Episode 32), cognitive-behavioral decision science author and professional poker player Annie Duke (Episode 37), and Shopify co-founder Tobi Lutke (Episode 41).   Transcript: https://fs.blog/knowledge-project-podcast-transcripts/tkp-insights-decision-making/ -- Want even more? Members get early access, hand-edited transcripts, member-only episodes, and so much more. Learn more here: https://fs.blog/membership/ Every Sunday, our Brain Food newsletter shares timeless insights and ideas you can use at work and home. Add it to your inbox: https://fs.blog/newsletter/ Follow Shane on Twitter at: https://twitter.com/ShaneAParrish
Actionable Insights

1. Prioritize Process Over Outcome

Focus on the quality of your thought process, not just the outcome. A solid process leads to better results over time, even if individual outcomes are sometimes negative due to luck.

2. Categorize Decisions by Reversibility

Classify decisions by their impact and how easily they can be undone. Deliberate carefully on high-impact, low-reversibility decisions, but prioritize speed and flexibility for reversible or low-impact ones.

3. Gather Context Before Deciding

Acquire all relevant context and information before making a decision, rather than making a decision and then seeking data to justify it.

4. Cultivate Intellectual Humility

Regularly ask ‘Why am I sure?’ and evaluate the reliability of your data and the source of your confidence, especially when making pronouncements or acting on intuition.

5. Proactively Seek Dissenting Views

Actively incorporate dissenting voices and alternative perspectives. Use techniques like ‘red teaming’ or ‘premortems’ (imagining future failure and identifying causes) to uncover potential flaws and broaden your perspective.

6. Delegate Decisions to Experts

Deliberately make fewer decisions yourself by pushing decision-making authority to the appropriate domain experts within your organization, as your need to decide often signals an underlying organizational issue.

7. Systematically Manage Emotions

Identify emotions, determine if their root cause is incidental or integral to the decision, and if incidental, consciously dismiss them to prevent irrelevant feelings from skewing judgment.

8. Verbalize Thought Process

Explain your reasoning to others (or imagine doing so) to identify flaws in your logic and receive personalized, direct feedback from mentors or peers, which accelerates improvement.

9. Align on Underlying Models

When disagreements arise, dig into the underlying mental models and optimization goals rather than just debating the decision itself. Have teams explicitly document their mission and key metrics to ensure foundational agreement.

10. Use ‘Betting’ Thought Experiment

Imagine putting a monetary value on your opinion to force deeper reflection and challenge assumptions about your certainty before making pronouncements.

11. Keep a Decision Log

For major decisions, create a log entry detailing the decision, key information considered, and the rationale. Revisit this log periodically to assess your process with hindsight and mitigate bias.

12. Prioritize Personal Growth

Continuously invest in your personal growth to stay ahead of the demands of your role, preventing yourself from becoming a bottleneck to your organization’s potential.

13. Conduct Small, Parallel Experiments

When facing critical strategic decisions with uncertainty, design and run small, parallel experiments to gather data and test assumptions before committing to a larger course of action.

14. Foster Process Accountability

As a leader, ensure alignment on the decision process and strategy before execution. Hold individuals accountable for the quality of their process, not just the outcome, and commit to future review.

15. Practice Systems Thinking

Employ systems thinking by drawing diagrams that map out system boundaries, identify forces, and illustrate feedback loops. This exposes assumptions and fosters shared understanding of complex problems.

16. Learn from Other Organizations

Scrutinize other organizations and reverse-engineer what works for them and why, especially in evolving fields, to gain insights for your own practices.

17. Embrace Assigning Probabilities

Don’t fear assigning probabilities to potential scenarios. This practice fosters information hunger and open-mindedness, driving you to seek diverse information and perspectives to refine your estimates.

18. Recognize Decision-Making Styles

Understand that people operate from conceptual, ethical (good vs. evil), or affiliational (tribal) frameworks. This awareness helps in understanding disagreements and adapting your communication.

19. Adapt Decision-Making to Context

Recognize that the ‘best’ decision-making approach is context-dependent. What works in one cultural or environmental setting for survival and success may not work in another.

20. Use High-Volume Environments

Leverage environments that offer a high volume of iterations or experiences (e.g., online simulations) to quickly accumulate experience and see various situations unfold.

21. Internalize Group Conversation

Even when working alone, imagine explaining your thoughts and decisions to others. This internal dialogue simulates external challenge and helps refine your ideas.

22. Foster Openness in Decision Pods

Within decision-making groups, establish an agreement that withholding dissenting perspectives or relevant information is a violation of trust, promoting open and honest challenge.