Be Decisive – Decision-Making: Dreams to Reality Series #2

By: Phoenix48

Decision-making is an integral part of human life, a fact that is simultaneously a gift and a perpetual task. Decisions range from the seemingly trivial habits of our daily routines to the pivotal moments that shape our careers, relationships, and life trajectories.

This is the second post in the Dreams to Reality series, preceded by Setting Goals and followed by Crossing the Decision-Action Gap. This post references concepts from the Metacognitive Processes post.

“It is the characteristic excellence of the strong man that he can bring momentous issues to the fore and make a decision about them. The weak are always forced to decide between alternatives they have not chosen themselves.

– Dietrich Bonhoeffer

Decision-making is both an Art and a Science

Containing elements of both philosophy and science, the discipline of decision-making holds immense power in shaping our present and future. It’s a cognitive process that entails selecting the best course of action from a set of available options. We guide our decision-making with our values, goals, and the surrounding context of our lives. While we might like to think that our decisions are mostly rational and objective, closer examination reveals a multifaceted interplay of logic, emotions, biases, and cognitive processes.

We are going to investigate the intricacies of decision-making, exploring the factors that influence it. We’ll also look at the strategies we can employ to make informed and effective choices.

Decision-making: Leonardo Da Vinci's "Vitruvian Man"
Leonardo Da Vinci’s “Vitruvian Man”

We will take a closer look into the psychological, philosophical, and rational aspects that underlie our choices. We will examine the causes and circumvention of common errors individuals and organizations make when making decisions.

When making a decision, we weigh a multitude of factors including reason, beliefs, values, experience, emotions, and biases. We weigh the benefits and drawbacks of our possible choices and determine what other preliminary decisions and actions we must make to support larger decisions. There could also be factors that limit the ability to make good decisions, including missing or incomplete information, deadlines and other time restraints, and limited physical or emotional resources.

Our decisions are the threads that bind the events of our lives together. They shape the fabric of our life journey, and, with some effort, effective decisions can create the life we truly desire.

Decision-making – Conscience vs. Intuition

Two factors that sometimes play opposing roles in decision-making are conscience and intuition. Conscience is our inner sense of right and wrong that encompasses our beliefs and values. Experience plays a subordinate role in assisting in determining whether a proposed action’s consequences will be in alignment with our conscience. Intuition (i.e. shrewdness), on the other hand, is primarily based in experience with conscience playing the lesser role.

How these two factors play into decision-making can be best understood by applying the personal boundaries concept. Conscience regulates whether we are choosing a course of action that is destructive or constructive toward others. Intuition regulates whether we are choosing a course of action that is mutually constructive or enables others to be destructive toward us. Effectively balancing conscience and intuition situationally is commonly called wisdom.

When we are in a familiar situation, we often rely on intuition or habits. Our decisions are fast and can be automatic. They are usually based on hard-won experience. However, not everyone learns the appropriate lesson from a given experience; not all experience gleaned is equal. As the Roman philosopher Seneca observed, “So you must not think a man has lived long because he has white hair and wrinkles: he has not lived long, just existed long.” Nor is past experience necessarily entirely relevant to the particulars of a current situation, especially during an era characterized by lightning-fast change. However, we should not interpret this to mean that experience is useless or obsolete when dealing with new things.

Thus, to better understand the role of intuition in decision-making, we must differentiate it from habit.

Street-Smarts: Intuition

Trusting our intuition often saves us from disaster. – Anne Wilson Schaef

  • Intuition is a mental process involving quick, often subconscious judgments or decisions based on past experiences, knowledge, and emotions. It can feel like a hunch or an instinct and we may have a feeling of “just knowing” something without being able to prove or explain why in the moment.
  • We often depend upon intuition in situations where there is not enough time to consciously analyze all available information. It relies heavily on pattern recognition and draws on our subconscious knowledge and experiences to arrive at a decision quickly.
  • Intuitive decisions may be only partially aware. We recognize some intuitive insights consciously, while others occur at a subconscious level. However, intuition often involves some level of conscious awareness, even if it’s not based on explicit reasoning.
  • Ideally, intuition is flexible and adaptable, as it draws on a wide range of experiences and knowledge. We can apply it to various situations and adapt to changing circumstances. However, it can also be biased and it often pays to pause and take a reflective “sanity check” as to whether the intuitive response has any major drawbacks.
  • Intuitive decisions can be mentally taxing, especially when intuition conflicts with conscience and/or critical thinking. This is often the case when dealing with complex and novel situations that require the integration of various pieces of information.

Repetitive Automatic Decisions: Habits

  • Habits are automatic and repetitive behaviors. We form habits through consistent repetition of a particular action in response to a specific situation. They are behaviors that become ingrained over time.
  • We execute our habits largely unconsciously. Habits are automated responses to specific cues. We may not even be aware that we are engaging in a habit until the action is already underway.
  • Being less flexible, habits are not as adaptable as conscious decision-making. Habits are specific to particular cues and triggers, and changing or breaking a habit usually requires conscious effort and sustained practice.
  • They reduce cognitive load. Once we form a habit, it operates without requiring significant mental effort or attention.

To change a habit, make a conscious decision, then act out the new behavior. – Maxwell Maltz

Intuition and habit are distinct mental processes that serve different functions. Intuition involves making quick, often subconscious judgments based on past experience. Habits are automatic behaviors that occur in response to specific cues. Both processes have their role, with intuition providing adaptability and quick responses, and habits offering automation in familiar situations using minimal cognitive resources.

Decision-making – Short-Term vs. Long-Term Thinkng

Long-term thinking and short-term thinking represent two distinct approaches to decision-making.

Short-Term Decisions

Short-term decisions focus on immediate goals, usually within a limited time frame, often ranging from a day to a few months. They prioritize immediate needs and outcomes, such as addressing urgent problems or maximizing short-term payoffs. Short-term decisions often involve quick assessments and rely on readily available information. Short-term decision-making has some significant drawbacks:

  • Immediate Gratification: Short-term thinking often prioritizes immediate benefits and instant gratification as opposed to long-term satisfaction. We make decisions with a focus on the present moment without necessarily considering the long-term consequences.
  • Risks of Impulsivity: This approach may lead to impulsive decisions. We may prioritize quick gains or solutions without thoroughly evaluating the potential risks or implications for the future.
  • Reactive Decision-Making: Short-term thinking is reactive, responding to immediate needs or pressures without a comprehensive analysis of the broader context. This can result in decisions that lack the necessary foresight.
  • Limited Planning: We tend to limit planning to the near future, and we may neglect or sacrifice long-term goals may for short-term payoffs.

“All children are born pure egoists. They perceive their needs to the exclusion of all others. Only through socialization do they learn that some forms of gratification must be deferred and others denied.”

–Andrew Vachss
Long-Term Decisions

Long-term decisions span a broader time horizon, typically extending beyond a year or even several years into the future. They consider the potential long-term consequences and impacts of decisions on various spheres, such as financial, strategic, or personal goals. Long-term decisions often require analysis, evaluation, and planning, and must account for multiple factors and potential scenarios. Examples of long-term decision-making includes strategic planning, investment decisions, career choices, and major life goals.

  • Strategic Planning: Long-term thinking involves strategic planning and a focus on future outcomes. We make decisions with an understanding of how they contribute to broader, overarching goals.
  • Sustainable Solutions: We give consideration to the sustainability and enduring impact of decisions. Long-term thinking aims to create lasting solutions rather than quick fixes.
  • Risk Mitigation: There is a greater emphasis on risk assessment and mitigation, recognizing that decisions may have far-reaching consequences. This approach involves anticipating challenges and preparing for potential obstacles.
  • Delayed Gratification: Long-term thinking often requires a willingness to delay immediate gratification for the sake of larger, more significant achievements in the future.
Key Differences:
  • Time Horizon: Short-term decisions focus on immediate results, while long-term decisions consider future implications.
  • Scope: Short-term decisions address specific situations, while long-term decisions entail a broader perspective and more comprehensive scope.
  • Information and Planning: Short-term decisions often rely on readily available information, while long-term decisions require analysis and forecasting.
  • Goals: Short-term decisions prioritize immediate needs and objectives, while long-term decisions align with long-range goals and aspirations.

Instant gratification involves seeking immediate pleasure often without significant consideration for long-term consequences. It often revolves around the desire for quick rewards or psychological relief. For this reason, decision-making based on instant gratification tends to be impulsive, driven by the desires experienced in the moment. Additionally, when we prioritize instant gratification, we can seek quick fixes and workarounds to problems that require a more nuanced and persistent approach to properly solve. In many cases, choices made for instant gratification lead to regrets later on, especially if they compromise long-term goals and well-being.

Delayed gratification requires delaying immediate rewards in favor of achieving more substantial, lasting goals. This approach requires patience and the ability to endure short-term discomfort for greater future benefits. Delayed gratification involves setting goals, creating plans, and making decisions with an understanding of how each choice contributes to their broader, overarching objectives.

Long-term thinking is mature, masculine, and character-building

Pursuing long-term life goals leads to a more durable sense of satisfaction and fulfillment. Working towards and achieving meaningful, enduring goals contributes to a deeper and more lasting sense of well-being. Finally, when we prioritize making quality long-term decisions, we are often more resilient in the face of setbacks. It enables us to view challenges as temporary obstacles rather than insurmountable barriers and allows for the fact that progress toward long-term goals necessarily involves ups and downs.

Instant gratification takes too long. – Carrie Fisher

Alcoholics and addicts typically move toward things that feel good in the short term and away from things that feel bad or uncomfortable. This may seem obvious, but the behavior patterns favoring short-term thinking (and not just about drugs) are entrenched and require a sustained effort to direct toward long-term thinking. As we become more self-aware and spiritually mature, the more we direct our efforts toward the long term.

YOLO, Scarcity, and Abundance

A constant need for immediate gratification not only reflects immaturity but also low self-esteem and a fear-based scarcity mindset. The YOLO (you only live once) attitude prevalent in popular culture is one manifestation of cultural narcissism.

Scarcity Mindset
  • Characterized by a belief that there are limits on resources, opportunities, and success and these things are scarce – that life is a zero-sum game.
  • Individuals with a scarcity mindset tend to focus on what they lack, feel a constant sense of competition, and fear missing out.
  • They may exhibit behaviors such as hoarding, risk avoidance, and a reluctance to share or collaborate.
  • The scarcity mindset can lead to feelings of anxiety, dissatisfaction, and a belief that others “are getting over on you”.
Mindset Rooted in Abundance
  • Characterized by a belief that there are ample resources, opportunities, and possibilities available.
  • Individuals with an abundance mindset embrace the belief that there is enough for everyone to succeed and thrive.
  • They focus on gratitude, collaboration, and the belief that we can create and share opportunities.
  • An abundance mindset fosters a positive outlook, resilience, and a willingness to take risks and explore new possibilities.

A scarcity mindsets often leads to stress, anxiety, and limited thinking – hindering personal growth and fulfillment. Abundance mindsets promote positivity, resilience, and a willingness to explore new possibilities. An attitude of abundance often leads to greater opportunities for success and always enhances a sense of overall well-being.

Developing an abundance mindset:
  • Practice gratitude by focusing on what you have rather than what you lack.
  • Surround yourself with positive influences and supportive individuals who embody an abundance mindset.
  • Challenge limiting beliefs and reframe negative thoughts into positive ones.
  • Embrace a growth mindset that sees challenges as opportunities for learning and growth.

“I have an abundance mentality: When people are genuinely happy at the successes of others, the pie gets larger.”

–Stephen Covey

Decision-making – Applied Ethics: Conscience and Critical Thinking

“Every human has four endowments – self awareness, conscience, independent will and creative imagination. These give us the ultimate human freedom… The power to choose, to respond, to change.”

–Stephen Covey

Happily, applying conscientiousness and long-term, abundance-based thinking to our decision-making is synergetic. That is, the application of our mature conscience usually implies setting aside short-term thinking in favor of long-term thinking. The two usually are mutually supportive.

As previously stated, decision-making often involves a mixture of intuition and conscience. Critical thinking helps enable us to strike a balance between our self-preservation instincts and acting in a moral, conscientious manner that benefits both ourselves and others. However, crucial factors such as bias and other blind spots are often unconscious, making decision-making difficult to fully execute rationally.

Nonetheless, there are steps to ensure that we make consistently good choices, including gathering as much information as possible, considering all the possible alternatives, evaluating their benefits and costs, and taking time to reflect on important decisions. We call this critical thinking. But first, let’s set the stage by looking at a simplified approach.

The OOC/EMR Decision-Making Framework

Advocated by author and motivational guru Tony Robbins, the OOC/EMR decision-making framework provides a simplified approach to decision-making. We present this framework not with the intent of its use as a stand-alone approach, but to impart the key steps of decision-making powered by the engine that is critical thinking. Additionally, the steps outlined here segue directly into risk management. Before we outline OOC/EMR, let’s summarize the usual aspects of a real decision:

  • Uncertainty: Some things we know and some things are unknown.
  • Complexity: There are moving and interrelated parts, and some connections are unclear.
  • Consequences: The decision is important and the outcome is significant.
  • Alternatives: There are several options, each of which comes with various levels of uncertainty and complexity.
  • Interpersonal Factors: The decision will impact real people and those people have feelings, emotions, and opinions.
OOC stands for:
  • Outcome: The first step of any decision-making is determining what do we want the outcome to be. If we don’t have clarity on that, we need to get it before proceeding or we will find ourselves wandering aimlessly in the forest.
  • Options: The next step is to list the possible options. We want to list all the options, not just the obvious ones. Through further analysis, we will invalidate some later but it’s best to look at the full picture. Sometimes having too many options may seem overwhelming, but once we eliminate some options that feeling will quickly subside. Keeping an open mind means keeping our options open.
  • Consequences: This step is where we evaluate the pros and cons of our various options in regard to our desired outcome. We lay out the difficulties or obstacles for each choice. Then we lay out what we have to gain. And we look at what it will cost.
EMR stands for:
  • Evaluate: This is the risk management step (covered below) where we look at the outcomes likely from our options and the probability of downsides and upsides occurring. We also rate the desirability of the outcomes of various options; if successful, some options may have a more powerful impact than others.
  • Mitigate: For each downside, we explore the ways to limit the damage of downsides while maximizing the upsides. This is important because our ability to influence the outcome might tip the scale toward one option and away from another.
  • Resolve: This is where we choose our best option and resolve to execute it. We devise the details of our plan and decisively implement it. Tony Robbins stresses it’s better to execute a decision and monitor it than to remain paralyzed in indecision. When the situation merits a change in approach, then make changes and adjust.

The OOC/EMR framework serves as a useful outline for understanding the core process of real decision-making: Critical thinking.

Critical Thinking – Step #1: Analysis

We use analysis to identify and examine the nature of a decision. Analysis serves to: Identify relevant information, advance premises that serve as evidence and reasons for various approaches, and develop arguments supporting possible conclusions. First, let’s define some terms:

  • Proposition: A statement or claim that we put forward for consideration or discussion. It can be true, false, or contain some elements that are true and some that are false.
  • Premise: A specific proposition that we use as a basis or starting point and as evidence for an argument. They can be factual statements, assumptions, or pieces of evidence. Premises are the building blocks of an argument and we use them to support or justify a conclusion using logical reasoning. In other words, premises are the reasons or pieces of information that we present to justify the argument’s main point: the conclusion.
  • Argument: An argument is a construct that consists of one or more premises and a conclusion. It is a structured set of statements intended to persuade or convince someone of a particular point of view or position. Thus, we use an argument to present a logical and coherent case to support a specific conclusion.
  • Conclusion: The conclusion is the specific proposition that the argument is trying to establish or prove. It is the central point, opinion, or claim that we have built the argument around. The conclusion is the end result of the reasoning process presented in the argument. It is the main message or the key idea that the arguer seeks to achieve acceptance for.
In simple terms:

A proposition is a broad term that encompasses any statement or claim. A premise is a specific proposition that serves as evidence and justification for an argument’s conclusion. An argument structures premises to create a conclusion, which is the main goal of the exercise.

Propositions inform premises and premises build arguments

Propositions serve to provide inferential relationships between facts and establish sources for reasoning. These may include personal experience, intuition, commonplace belief, research, opinions of experts, etc. They act as a starting point to develop premises and reasons to support (or object to) a conclusion.

The idea is to boil decisions down to their essential elements and eliminate distractions. Through analysis, a decision’s hierarchical structure begins to appear. One method of doing this for complex decisions is argument mapping which creates a visual representation of this hierarchical structure. Argument mapping is outside the scope of this post, but you can read more about it here.

Decision-making: Steps of Analysis

  • Define the issues: Understand what the decision entails, what information we have, what is available, and what we need to address. It’s essential to frame the decision accurately and concisely to establish the context and scope of the decision. Define goals and objectives. For complex problems, critical thinkers use techniques such as brainstorming, mind mapping, or problem statement formulation to understand the problems and issues.
  • Collect information: Once we’ve identified the core issues, we need to gather relevant information related to it from reliable sources. This may involve research, discussion, and seeking different perspectives.
  • Identify Ethical Issues: We must pay attention to our conscience. Stay attuned and flag ethical issues or conflicts within the information as we collect it. This awareness can lead to a more thorough evaluation of the implications of different choices as we proceed.
  • Preliminary Evaluation: Assess the credibility, reliability, and relevance of the information and discard unreliable or irrelevant information. Consider the expertise of sources, the context in which the information was presented, and the potential motivations of the sources. Develop propositions.
  • Develop arguments: Apply logic to develop premises and make rational arguments. Employ deductive or inductive reasoning. Deductive reasoning is the application of a premise to a particular case. Inductive reasoning is making generalizations based on observations and evidence.

Critical Thinking – Step #2: Evaluation

Terms used in this section:

  • Balance: The practice of considering and weighing multiple perspectives, arguments, or factors in a fair and even-handed manner when making decisions or judgments. It involves avoiding bias, emotional attachment to a particular viewpoint, or hasty judgments in order to arrive at a more objective and rational conclusion.
  • Bias: The presence of unfair, prejudiced, or unreasoned perspectives that influence the way we interpret information and reach decisions. Bias leads to a lack of objectivity and impartiality, distorting the evaluation of evidence and resulting in the formulation of inaccurate conclusions. Biases impact our ability to think clearly and make sound decisions. See columns below.
  • Fallacy: A common error in reasoning that can undermine the validity of an argument. Often deceptive, fallacies appear persuasive but are based on faulty logic. Recognizing fallacies is essential for evaluating arguments, identifying weaknesses, and ultimately for making informed decisions. See columns below.
  • Credibility: The quality or attribute of being trustworthy, reliable, and believable. It is the degree to which a source of information, an argument, or an individual is credible or worthy of trust. Credibility is a crucial factor in making informed judgments. To be credible, information must come from a valid source, be supported by evidence, be internally consistent, be free of bias, and be current.
  • Relevance: The quality of information, evidence, premises, and arguments being directly related and applicable to the issue at hand. When information or arguments are relevant, they have a clear and meaningful connection to the specific matter under consideration. They contribute to a deeper understanding or a more accurate evaluation of the issue. Relevant information and arguments also are direct, meaning not containing unnecessary detours or tangents. They are also specific and timely; this could mean either recent or historical, depending on context.
Evaluation is assessing the validity of information, premises, and arguments

Evaluation is a skill we use to assess information, propositions, and premises identified through the previous analysis step. We evaluate with respect to credibility, relevance, balance, bias, potential omissions, and the logical strength of inferential relationships between propositions. Such assessment allows for informed judgment regarding the overall strength or weakness of an argument. If an argument or its propositions are not credible, relevant, logical, and unbiased, we should consider excluding it or subjecting it to further analysis.

Discern the essential data from extraneous or untrustworthy diversions

Evaluating the credibility of claims and arguments is moving beyond merely identifying the source of propositions. It is thoroughly examining their trustworthiness and credibility. Also important is determining the relative value of personal experiences, intuition, commonplace beliefs or opinions, expert opinion, and scientific evidence. Don’t underestimate the importance of evaluating sources; some sources are just more credible than others. It is invaluable to develop an understanding of the source’s motivations. We must consider how these motivations might influence the structure and contents of the propositions and conclusions.

Pay attention to relevance

Evaluation also requires consideration of the relevance of claims within an argument. We determine relevance by examining the context of premises, meaning the pertinence and bearing of one proposition to another. For example, say we developed an argument about the damage caused by parasitic insects in an orchard. That argument contains two premises, each based on a separate proposition. One proposition is about insects that infect apple trees and the other about insects that infect orange trees. Upon reviewing the premises and the supporting propositions, one might conclude that apples (and the insects that infest them) are not oranges, and therefore the resulting argument is not valid.

Eliminate imbalance and bias

Other factors to consider are balance and bias. The “slant” (or imbalance) of an argument can be important if it seems imbalanced in favor of one point of view. It’s possible that the argument omitted key points that we should consider. Imbalance is also a red flag that may indicate some level of bias.

But just because an argument is balanced does not mean that it isn’t biased. Sometimes the opposing views presented have been “cherry-picked” because they are easily disputed. This is usually a deliberate deception to create the illusion of balance (that is, a straw-man) to falsely strengthen the opposing argument. This is only one example; there are many reasons why a balanced argument may, in fact, be biased.

Apply conscience and ethics

While evaluating information and analyzing options, consider the ethical implications of the arguments. Conscience may lead you to reject options that violate your values even if those options seem otherwise rational or advantageous.

Decision-making: Steps of Evaluation

  • Evaluate the credibility and relevance of the information collected.
  • Determine the context in which the sources present the information: The context can determine if the information is applicable to the entire problem or only in regard to a particular aspect of it. Or the opposite, the information can be applicable to a larger problem beyond the scope of the decision or decisions in question. Context can also inform awareness of any slants or biases.
  • Create balance: Examine information and preliminary arguments from all angles and points of view, including intuition. Conscience can help navigate situations where there are competing interests or ethical dilemmas. This may require an effort to seek compromise or make choices that prioritize ethical principles over personal or professional gain.
  • Identify assumptions, biases, and fallacies: In addition to biases/fallacies that may be implicit in the information and arguments, it is necessary to become aware of and examine our own biases and assumptions – especially those that may be ethically questionable or morally problematic. It is necessary to acknowledge the potential influence of personal beliefs and preferences. Critical thinking involves recognizing and challenging preconceived notions and biases to arrive at more objective and well-reasoned conclusions. See columns below.
Develop the arguments:
  • Weigh the pros and cons: Develop arguments for and against possible courses of action using propositions and explore various options. Incorporate ethical reasoning, which involves considering the moral dimensions of a problem or decision when evaluating the pros and cons.
  • Develop counterarguments: To draw well-informed conclusions, consider counterarguments and opposing viewpoints. Analyze the weaknesses and strengths of these counterarguments to refine your own position.
  • For weighty and complex decisions: There are various tools and techniques available to assist with critical thinking, particularly for business, such as SWOT analysis (Strengths, Weaknesses, Opportunities, Threats), cost-benefit analysis, and root cause analysis, to evaluate decision options objectively. These tools are beyond the scope of this post, but there is extensive information freely available online.
Common Fallacies

Ad Hominem: Attacking the person making the argument rather than addressing the argument itself. It’s an attempt to discredit the person’s character or motives rather than engaging with their ideas.

Straw-Man: Misrepresenting or distorting an argument to make it easier to attack. Instead of addressing the actual argument, they attack a weaker or altered version of it.

Appeal to Authority: Claims that a statement is true simply because an authority figure or expert says it is. While expert opinions can be valuable, they should be supported by evidence and sound reasoning.

Circular Reasoning: This fallacy occurs when the conclusion of an argument is assumed in one of the premises. It essentially restates the same idea in different words without providing any new information or evidence.

False Dilemma (False Dichotomy): Presenting a limited set of options as if they are the only possibilities, ignoring potential alternatives. It can force a choice between two extremes when there are other valid choices available. Related to the “Double Bind” manipulation tactic.

Hasty Generalization: Making a broad or sweeping conclusion based on insufficient evidence. This usually results from drawing conclusions without a sufficiently representative sample.

Appeal to Emotion: Instead of relying on reason and evidence, this fallacy attempts to persuade through emotional manipulation. It uses emotions like fear, pity, or sympathy to distract from the actual argument.

Red Herring: Introducing irrelevant information as a diversionary tactic to shift the focus away from the main issue.

Appeal to Tradition: Arguing that something should be accepted or continued because it has been done that way for a long time. It assumes that longstanding practices are inherently better, which may not be the case.

Post Hoc Fallacy (False Cause): Assuming that because one event happened after another, the first event caused the second. It confuses correlation with causation.

Common Biases

Confirmation Bias: The tendency to favor information that confirms our preexisting beliefs or ideas while ignoring or dismissing evidence that contradicts them.

Anchoring Bias: Relying too heavily on the first piece of information we encounter when making decisions, even if it’s irrelevant to the current situation.

Availability Heuristic: Giving more weight to information that is readily available in our memory or easily accessible, rather than considering all relevant information.

Hindsight Bias: The tendency to believe, after an event has occurred, that we would have predicted or expected the outcome, leading to an overestimation of our foresight.

Overconfidence Bias: Overestimating our abilities, knowledge, or the accuracy of our beliefs and predictions.

Confirmation Bias: The tendency to seek out and pay attention to information that confirms our existing beliefs and to avoid or discount information that challenges them.

Groupthink: Prioritizing consensus and harmony within a group over critical analysis and dissenting viewpoints, leading to flawed decision-making.

Selection Bias: When the sample or data used for analysis is not representative of the entire population, leading to inaccurate conclusions.

Self-serving Bias: Attributing positive outcomes to our own actions or abilities while attributing negative outcomes to external factors or others’ actions.

Fundamental Attribution Error: Attributing the behavior of others to their personality or character traits, while attributing our own behavior to situational factors.

Status quo bias: A preference for things to stay the same and to resist change, even when change may be necessary or beneficial.

In-group Bias: Favoring and giving preferential treatment to individuals or groups we identify with, while showing bias or discrimination against groups with which we lack identification.

Decision-making: Right and wrong

“All of us show bias when it comes to what information we take in. We typically focus on anything that agrees with the outcome we want.”

–Noreena Hertz

Critical Thinking – Step #3: Inference

Integration: The inference step is a crucial step of the process where we draw conclusions or make judgments based on the information gathered and the arguments made. Drawing conclusions implies an act of synthesis: Putting parts of various information together to form a new whole. During the inference step, we look for patterns, relationships, or inconsistencies within the data and arguments.

Inference is evaluating existing conclusions and forming new ones

Inference is a process involving formulating a conclusion from an argument or several arguments and a body of evidence. This inference could be to accept a conclusion presented by a source in light of the evidence presented. Or, alternatively, devising an independent conclusion, which is usually required when integrating several arguments, each of which by definition supports its own conclusion.


Another important aspect of inference is assessing the strength and validity of various conclusions and their supporting arguments. This involves the re-examination of the available evidence based on the argument and conclusion. The assessment considers whether the conclusion is well-supported by the available evidence and whether there might be alternative explanations or interpretations. Therefore, this requires us to be open to the possibility of revising or adjusting inferences in light of new interpretations or if new information or evidence emerges.

The inference process is iterative

Additionally, when exploring new interpretations, it may be necessary to recognize the need for additional information. The next step is to gather it and judge the plausibility of utilizing this new information to support an existing conclusion or draw a new conclusion. Thus, inference overlaps with evaluation in that we use both to judge the relevance and acceptability of an argument. Furthermore, the process is iterative in that the initial arguments should be re-evaluated in light of any new information to ensure that it is reasonable to draw the conclusion previously derived.

Communication is key

Effective communication of inferences is an important aspect of critical thinking. It is important to be able to articulate your conclusions and reasoning in a clear and concise manner. Good communication is mandatory if others are to understand and assess our thinking and be persuaded by our arguments. Additionally, articulating our conclusions and decisions serves as a final assurance of the quality of our reasoning; if we have problems explaining the conclusions in a simple and concise manner, there are likely problems.

The Role of Conscience in Decision-making

“Cowardice asks the question, is it safe? Expediency asks the question, is it politic? Vanity asks the question, is it popular? But conscience asks the question, is it right? And there comes a time when one must take a position that is neither safe, nor politic, nor popular, but one must take it because it is right.”

–Rev. Martin Luther King, Jr.

Conscience serves as an integral component of both decision-making and critical thinking by prompting us to critically evaluate the ethical dimensions of problems. Conscience guides our choices and helps to align them with our values, reducing the likelihood that we compromise our ethical principles. Of course, an individual’s conscience varies based on personal values and cultural background, so ethical decisions and critical thinking will differ from person to person.

Conscience can also play a role in communicating our reasoning to others. When we allow our moral principles to guide us, we may be more persuasive in conveying the wisdom of a particular course of action.

Decision-making and Conscience: van Gogh "The Good Samaritan"
“The Good Samaritan” by Vincent van Gogh

Additionally, in a leadership context, ethical leaders incorporate conscience into their decision-making process to provide solutions that, ideally, are in the best interests of everyone. Conscience can inspire leaders to make ethical decisions that inspire trust and respect among their team members and stakeholders.

Decision-making: Risk Management

“You can never protect yourself 100%. What you do is protect yourself as much as possible and mitigate risk to an acceptable degree. You can never remove all risk.”

–Kevin Mitnick

Embracing “risk-based” decision-making has become increasingly popular in business. However, in the real world, every decision that requires critical thinking involves some level of risk. Every decision that matters enough to spend time thinking through is important by definition and involves uncertainty. That is, the outcomes of real decisions are important and uncertain.

Therefore, we define risk as uncertainty that matters. Risk refers to the possibility of uncertain or negative events occurring that could impact the outcome of a decision. Every true decision involves some level of risk, whether it’s financial risk, operational risk, or personal risk. Some decisions, such as when one option is vastly superior to a second, do not require extensive analysis or thought. In this case, the “decision” makes itself.

When making a real decision, uncertainty requires us to choose between various options where there is no clear best path. Often, we have incomplete information to fully support our decision. Consequently, the outcomes of some or all options cannot be fully predicted. We must make the best possible decision with the information at hand in a specified timeframe with the situation we face.

In decision-making, it is important to consider and manage risks effectively. This involves identifying potential risks, assessing their likelihood and impact, and implementing strategies to mitigate or minimize them.

The decision-making process needs to:
  • Clearly define objectives. Why do we need to make this decision? What outcome are we seeking? How will we measure success?
  • List options. List all available options, not just the obvious ones. The less obvious options may provide a “third path” if the obvious options have too many negative consequences.
  • Quantify the level of risk of each decision alternative by assessing the level of uncertainty and the nature of the possible outcomes.
  • Analyze and assess potential negative outcomes and estimate the likelihood of each of those outcomes occurring. Evaluate the potential impact or consequences of those outcomes.
  • Consider risk management strategies, such as risk avoidance (choosing alternatives with lower risk), risk reduction (implementing safeguards to lessen the impact of negative outcomes), and risk transfer (shifting responsibility to others through insurance or contracts).
  • Decision-makers often use expected value calculations to quantify the potential benefits and risks of different options. We calculate expected value by multiplying the probability of each possible outcome by a favorable outcome value (a number representing how desirable a particular outcome is) and comparing the products of various options.
  • Choose the option or options that minimize exposure while maximizing the chances of delivering the required objectives.
  • Monitor the outcome from our decision against the objectives, to ensure that events are proceeding as expected. If not, corrective action is likely required and more decisions made.
  • Mitigate negative consequences with corrective action and decision.
  • We may incorporate other risk analysis techniques such as cost-benefit analysis.
Risk-management is crucial in many professional endeavors

Understanding and managing risk is crucial for effective decision-making in various fields such as business, finance, healthcare, and project management. Risk management allows us to make informed choices, anticipate challenges, and take appropriate actions to achieve objectives.

The Moral Hazard: Fires were a particularly common problem in ancient Rome – and the insurance industry was born. It didn’t take long for shady businessmen to take advantage: Start a new, heavily insured, business and if it does well, great. If not, then it mysteriously burns to the ground. A moral hazard is any situation that can be described as, “Heads I win, tails you lose.” It is the recognition people engage in risky behaviors when they are protected from the consequences of their actions.

Decision-making Pitfalls to Avoid

Pitfall #1 – Trusting Your Gut

“Trusting your gut” is probably the second-most common bad advice frequently given, the first being “just be yourself” (but that’s a debate for another day). Often seen in social media, it’s usually in response to doubt, as in “When in doubt, trust your gut!” On the other hand, in psychological circles, “your gut”, otherwise known as intuitive judgment, is bemoaned by clinicians who describe knee-jerk decisions as “the absence of analysis”, lacking in effort, attention, awareness, and conscious control.

In regard to emotions, clinicians often advise “leave your emotions at the door” when making decisions, as emotions can get in the way of clearheaded thinking. Nevertheless, emotions serve an important purpose in signaling us when something is wrong – which we would be fools not to heed.

It’s also clear that intuition plays an important role, particularly when a decision is required in the moment. Emotions and intuition are extremely important in the creation and enforcement of personal boundaries, allowing us to sense violation.

Likewise, both emotions and intuition have a legitimate role to play in making a conscious decision even when there is no significant time restraint. The key is to value our intuition as a piece of important information when making a decision. However, we must be informed by our intuition and emotions, not ruled by them, and not allow them to ride roughshod in the driver’s seat and steamroll others and likely ourselves. With emotions, in particular, we must own and be sovereign over them – we must not allow our emotions to control us. Emotional maturity is essential to personal empowerment, living responsibly, and ultimately our sobriety.

Be aware of when you are outside of your usual environment

An additional consideration is that while intuition can inform us in a variety of circumstances, it only gives us expertise within particular environments. And the further from our natural environment we move and the more we move toward the new and unfamiliar, the less value our intuition has.

In extreme cases, our intuition is a liability. Any traveler who has driven in a county on the opposite side of the road is familiar with how difficult it is. When driving on the “wrong” side of the road, our intuition is exactly incorrect. Thailand is notorious for tourist deaths on rented scooters because of the combination of driving on the left and the fact that Thais have a much higher threshold for risk – meaning their behavior is unpredictable to the Western driver.

Another common example is sales. An aeronautical engineer familiar with all aspects of launching a satellite into orbit does not make him an expert at buying a car at a dealership. Car salesmen love “smart” customers – they overestimate their abilities and tend to fall for the plethora of sales tactics employed such as “the false time constraint” and “the decoy option”.

Reflective Judgment and Metacognitive Processes

Intuition runs automatically and we possess no switch to turn it off, which is as it should be. However, the associated consequence is that biases and errors caused by it can be difficult to prevent. Even when errors are obvious in hindsight, we only can prevent them from happening again in the future by careful monitoring using reflective judgment.

Reflective judgment is a metacognitive process and in real-time is a function of the related concept of observing ego (or “conscious observer”).

Metacognitive processes (MCP) refer to a set of higher-order cognitive functions that involve thinking about our thinking. These processes impact self-awareness, self-regulation, and effective learning. MCP includes metacognitive awareness, control, and evaluation. MCP are described and discussed in a separate post here.

Reflective judgment is the monitoring, evaluation, and regulation components of metacognitive control, which we describe in the MCP post referred to above. It includes analyzing the effectiveness of your strategies regarding learning and problem-solving and making adjustments based on your reflections.

Reflective judgment involves:
  • Self-Monitoring: The observing stage, where we observe what we have done and are doing now. By taking a step back, we look at the strategies we are currently using, how we’re going to implement them, and verify we’re following our plan.
  • Self-Evaluating: The judging stage, where we observe how our strategy is proceeding, or how we are doing as far as implementing our plans. After utilizing a strategy or technique for a period of time, we look at our performance and outcomes and judge how well it worked. For example, in an academic setting, this could be as specific as looking at a grade for a specific assignment, or as broad as your grade for the semester.
  • Self-Regulating: The modifying stage, where we observe what we need to change. If we had poor outcomes during the self-evaluation stage, this is where we change our strategy to something more effective. Sometimes that means the strategy didn’t fit well with the environment, the task, or the people involved. However, we could also discover that the strategy resulted in increased performance and no change is necessary.
Observing Ego

“Observing ego”, a term first popularized by psychoanalyst Heinz Kohut, is the ability to monitor and reflect upon one’s own thoughts, emotions, and behaviors without judgment or attachment. It is a form of self-awareness that allows individuals to detach themselves from their immediate experience and view themselves from a more objective standpoint. According to Kohut, the observing ego (OE) helps individuals develop a sense of self and understand their own motivations and actions.

OE is commonly used in various therapeutic approaches, such as mindfulness-based cognitive therapy and dialectical behavior therapy. It serves to help individuals better understand and manage their emotions and reactions. By developing OE, we gain insight into our thought patterns, emotional triggers, and automatic responses, which provide greater emotional regulation.

However, the concept and development of OE is also relevant as a valuable avenue in the process of self-actualization. OE allows us to perceive and, most importantly, is vital in our efforts to change. Without the ability to observe ourselves honestly, we experience ourselves as “acted upon” and lacking control. This experience of powerlessness and helplessness is the root cause of feelings of victimhood and resentment which trap us and block constructive action.

For the purposes of SDR, observing ego:
  • Is a subset of reflective judgment and occurs in real-time; OE exists only in a present-minded or “mindful” state.
  • The ability to “step away” from oneself to monitor, free of ego, and observe emotions and behavior simultaneously with experiencing the emotions and executing the behavior.
  • Represents a split between our experience and our observation of it.
  • Enables us to perceive clearly and change our behavior in real-time.
  • Is a skill that we can develop.

While OE can (and should) be developed “offline” through the MCP practices of meditation and journaling, the greater goal is to increasingly implement OE in real-time. Because intuition has an oversized influence on quick decisions, possessing a well-developed OE “running in the background” is a potent resource to aid our decision-making because it provides a reflective check on our instinctive reactions. As applied to human relations, this is a tall order: Stepping out of yourself when experiencing emotion, objectively evaluating the situation, and stepping back to re-engage with a constructive, win-win approach, is not trivial or easy. It requires awareness, present-mindedness, and composure.

Reflective judgment involves stepping back

Circling back to the topic at hand, the effective application of intuition into decision-making requires observing ego/reflective judgment. Simply put, reflective judgment involves taking a step back for the purpose of thinking about the problem and decision for a bit longer. In the moment, executing reflective judgment is utilizing our observing ego. Research indicates that delaying a decision by even a 10th of a second substantially increases decision accuracy. Obviously, a 10th of a second is not enough time to re-evaluate every problem, but the point is germane. If we care enough about a decision to think it through, it’s important enough to take a second look.

More comprehensively, reflective judgment is the conscious recognition of limited knowledge and how this uncertainty can impact the decision-making processes. Even for decisions not made in seconds or fractions of seconds, reflective judgment is vital in developing or inferring a solution or conclusion. No matter how good we believe we are at critical thinking, it always pays to ensure that we take that reflective step back.

Pitfall #2 – Insufficient Knowledge

This applies if we are not knowledgeable about the topic we want to make a decision about. If we are not, it is important firstly to acknowledge it to ourselves and possibly to others, if appropriate. Intellectual honesty and reflective judgment are paramount in allowing us to consider the nature, limits, and certainty of what knowledge we have both on the topic and the context of the topic. Only then can we evaluate what is required of us to gain the background and knowledge necessary to make a thought-out judgment.

However, the issue here may not necessarily be a lack of knowledge of the topic itself. Rather, it could be believing that we have the requisite background (or contextual) knowledge to make a critical judgment when this is not the case. For example, one may be an expert in art, but not in the mythological traditions of a particular indigenous people. In this case, it would be impossible to offer opinions on the merits of religious works produced by individual artists.

When we do not possess enough knowledge, an additional concern we may need to address is the possibility of us lacking the willingness to gain relevant knowledge. In the above example, it may be that the art of a people in, say, the Amazon jungle does not hold interest for every serious art critic.

Pitfall #4 – Assumptions, Misunderstandings, and Misrepresentation

A natural disposition that is perhaps the most useful in critical thinking and decision-making is a desire to find the truth. Truth-seeking and a general inclination to be well-informed is something many of us strive for. (Or assume we strive for.) It reflects a desire to practice informed reasoning.

Real truth-seeking implies a willingness to challenge not only our own beliefs but popular beliefs and social norms. We do this by asking questions both of ourselves and others. It requires us to be honest and objective about pursuing the truth, even if the findings do not support our self-interest, pre-conceived beliefs, or the beliefs and opinions of our social circles. And above all, it demands we change our mind about an idea if we got it wrong.

We all make mistaken assumptions from time to time. That is, we believe things to be true without adequate justification. For example, we might make a judgment based on stereotypes and personal associations. Or we might place too much value on a commonsense belief that, while widely held, has no evidence to justify it. It’s important to separate facts from beliefs and evaluate if “facts” are indeed factual with respect to how much empirical support they have to validate them.

Inconvenient Truths

Furthermore, sometimes the truth can be hard to swallow, and people might choose to manipulate information, understanding, and conclusions to accommodate their bias. In the more extreme variation of this tendency, people may ignore facts outright and replace them with falsehoods that support their narrative. One manifestation of this tendency is to engage in wishful thinking, in which they believe something is true because they wish it to be.

Some might also engage in relativistic thinking, in which, facts are mistaken for opinions or vice versa. For those exhibiting this fallacious reasoning, truth is subjective and just a matter of opinion. Avoiding bias and fallacious reasoning are top priorities for the decision-maker.

Fact vs. Opinion

Opinions are subjective statements or beliefs that are based on personal perspectives, feelings, or preferences. They are not verifiable or provable.

Facts are objective statements that can be proven or verified through evidence and data. They are independent of personal perspectives and are universally true.

For example, the question of which actor plays the best James Bond is an opinion. It is subjective; there is no right or wrong answer. If someone answers ‘Roger Moore’ they might be in the extreme minority opinion, but they are not incorrect. On the other hand, the earth orbiting the sun is a fact – it can be proven observationally and mathematically. If someone claims the sun orbits the earth, it is not an opinion. That person is simply mistaken.

My psychiatrist told me I was crazy and I said I want a second opinion. He said okay, you’re ugly too. – Rodney Dangerfield

Pitfall #5 – Closed-mindedness

Closed-mindedness is a significant barrier to critical thinking and decision-making. If you read through the list of biases and fallacies above, you have probably identified the most common, inherent biases in your thinking. One of the first priorities of decision-making is always going to be to evaluate this bias. However, our bias can be so strong that we become closed-minded, and this closed-mindedness renders us unwilling to even consider other perspectives.

Another way in which we might be closed-minded is a result of having properly researched and critically thought about a topic and then deciding that the conclusions drawn related to this topic are set in stone. We may believe the matter, as far as we are concerned, is “closed”. We may assume our perspective will never change and our knowledge will never need to adapt and evolve. However, the reality is that knowledge can change and adapt and our perspective can change. A common example is our culinary tastes and preferences, which change as we age, try new foods, and travel to new places. Political opinions are another example where people’s opinions change as a result of life experience.

Skepticism is cautious open-mindedness

Clearly being open-minded is valuable in decision-making – but so is skepticism. Skepticism is the readiness to challenge ideas, to withhold judgment before reviewing the evidence, and hesitation in jumping to a conclusion when the evidence and reasons are insufficient. Skepticism allows us to take a position and be able to change position when the evidence and reasons are sufficient. Additionally, it allows us to look at findings from various perspectives.

The natural cause of the human mind is certainly from credulity to skepticism. – Thomas Jefferson

The willingness to play “Devil’s Advocate” entails a capacity for skepticism. Being a Devil’s Advocate requires an inclination to be flexible, avoid rigidity, and tolerate divergent or conflicting views. It implies a willingness to treat all viewpoints alike prior to subsequent analysis and evaluation. It allows us to detach from our own beliefs and consider points of view other than our own without bias or self-interest. Finally, it establishes an atmosphere of open communication of ideas including acceptance of feedback by all parties and not rejecting criticism or constructive feedback without thoughtful consideration.

Therefore, closed-mindedness and skepticism are not directly related . We can be both open-minded and skeptical. It is closed-mindedness that shuts the door.

Pitfall #6 – Hindsight/Illusionary Correlation Biases

The often overlooked phenomenon of  “I knew it all along”, or hindsight bias, is the tendency to believe that we can predict consequences in situations that are largely dependent upon chance. There is a tendency to look back after the fact and easily spot all the indications that lead to a less-than-ideal outcome.

The hindsight bias can cause problems when it leads us to believe that we should have been able to foresee the outcome of situations that actually weren’t realistically predictable. As a result, we might make future decisions based on the outcome of that particular experience. Rather than relying on factors relevant to the present situation, we might find ourselves trying to predict the outcome based on previous experiences partially or totally unrelated.

Similar to the hindsight bias, the illusionary correlation is a tendency to see relationships where none exist. For example, if the police pull us over by twice when driving a friend’s red car, we might believe the car’s color, rather than our driving, is the reason. In this case, we believe the two events are related simply because they occurred around the same time with the same color car. In other cases, a one-time connection between two different things might lead us to conclude that the two are somehow related. For example, if you have a bad experience with a rude doorman at a club, you might mistakenly believe that all doormen are rude.

Because they lead to beliefs that are mistaken, hindsight bias and illusory correlations cause problems in our decision-making process. We are essentially making decisions based on bad information, which always is detrimental to making quality decisions.

In Summary

Decisions are the rudder that guides the course of our lives. We are defined by our decisions and actions, which determine what we actually want – despite what we may intend or claim. Two of the most important influences on our decision-making are intuition and conscience. Intuition is fast, based on pattern recognition, and protects us from destructive acts by others. Conscience is based on our values and directs us to be constructive toward others and avoid committing destructive acts.

Our decisions are also characterized by whether they offer short or long-term payoffs. Our tendency to make short or long-term decisions is partially determined by our self-esteem and our perception and attitude toward scarcity and abundance.

A powerful tool to combine the constructive elements of goal-setting, intuition, and conscience is critical thinking. Critical thinking emphasizes honing the skills that empower us to navigate uncertainties, make rational choices, and achieve positive outcomes in both personal and professional spheres. By embracing critical thinking, we can become more effective decision-makers in an increasingly confusing and complex world.

By fostering analytical skills, promoting open-mindedness, and encouraging a systematic approach, critical thinking empowers us to embrace uncertainty and make informed decisions. We have highlighted the importance of questioning assumptions, considering alternative perspectives, and weighing evidence.

It is in your moments of decision that your destiny is shaped – Tony Robbins

Ultimately, the integration of critical thinking not only enhances the quality of decisions but also reinforces a mindset geared towards adaptability and continuous improvement. Critical thinking emerges as one of our most indispensable tools in navigating our journey and achieving our destiny.

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