Three techniques for better decision making

We make thousands of decisions everyday. We decide so reflexively that it's rare we stop to think about how we're making our choices. What criteria are we weighing? What would a good or a bad outcome look like? What was the outcome of the last relevant decision we made? While most decisions are small, our process for decision making impacts every element of our lives including professionally and personally.

I recently read "Thinking in Bets" by Annie Duke and in it, she suggests practical tips for improving our decision making that I've begun applying in my own life and work. The book highlights that good decisions are made when we have good processes – when we evaluate what we know, what we believe, how certain we are, and we weigh our options relative to the outcome we want to reach. Though the definition is simple, there are many ways we make mistakes in evaluating decisions.

For example, we assume the outcome of the decision dictates whether the process was bad or good (surprisingly, it doesn't). We typically believe we are the cause for all our good outcomes, but we're not to blame for the bad ones.  We also have a hard time learning from feedback because it requires acknowledging when we made mistakes. So how can we overcome these, and our many other biases, to improve our decision making?

Tip 1: 📘 Keep a decision log

Examining and learning from our mistakes is key. Annie recommends a dispassionate review of our decisions to evaluate what we could have done better. This works especially well for important decisions we make in work, relationships, or with our finances or health. For bigger decisions, we can practice thoughtfully dissecting decisions from the past and make predictions about those coming in the future.

While we can do this a number of ways, I personally find that writing forces me to ensure I understand my own reasoning and can justify my arguments clearly. I keep a Decision Log, and created the template below motivated by Annie's points. For each major decision, I record:

1. Decision (What was the decision? I also note the date and type of decision)
2. Scenario (Describe what led to the decision point)
3. Assumptions (What do I believe to be true and how certain am I?)
4. Criteria (How will I make this decision? What factors are important to weigh?)
5. Data (For example, if Criteria are "price" and "quality" then under Data I unpack the price and quality of different options)
6. Hypothesis (How do I think the situation will turn out? If I'm reflecting on a past decision, did I have a hypothesis beforehand?)
7. Outcome (After I make a choice, what happened?)
8. Learnings (What did I miss in my evaluation? What did I fail to see? I fill this out even if I was correct about the outcome)

Tip 2: 📥 Update your beliefs and behaviors

The value of the decision log is that you'll start to see which beliefs are true and untrue over time and adjust them to your benefit. You also see which behaviors aren't serving you.

To give an example of a learning from my personal life, when I was on the dating scene, I used to believe that it took a long time to figure out if someone was a potential match. I would get well into date 5 or 6 (or more) with someone before realizing that the small red flags I was seeing were reasons to end the relationship. If I was getting vibes on date 1 of unreliability, I ignored the signs and waited for date 7 when they were 1 or 2 hours late. Or if the person spent 70% of the first date talking about work... it took me until date 5 to realize 70% was a toned down number😅.

It took me a long time to see this pattern in myself. By regularly reviewing these types of decisions I realized I needed to trust my gut and act faster. My belief that "you need time to learn about someone" didn't apply when there were certain red flags. It also helped me formalize what my personal reg flag list looked like. I updated my belief and changed my behavior (which, to be fair, is easier said than done) and sailing has been smoother since.

Tip 3: 💰 Frame your decisions as bets

I recently told a friend applying for a new job that I was 100% sure she would receive an offer. Her response was lightning quick – "Wanna bet?"

Luckily, the interview process was over, so there was no risk that she would intentionally sabotage the interview in order to win. But still, I felt a pang of uncertainty – was I really sure she would get it? Did her qualifications match the job description? How many other candidates were in the running? I realized there was a lot I didn't know, and I had no right to be so confident. Annie emphasizes how treating our decisions as if they were bets, as if we had real skin in the game prior to the outcome being revealed, is a great forcing function to open your mind to your own uncertainties.

I found this framing helped a lot professionally. When I was newly head of product at a startup, one of the early decisions I made was proposing a series of large projects the product team should work on. To make sure I made the best decision possible, I wanted to solicit honest feedback from the leadership team on my ideas. I framed my ideas as bets we were making, breaking down major bets and minor bets, why I thought they made sense, and what a successful outcome looked like for each. What appealed to me about that framework was that it naturally opened the conversation to how certain we were as a company about reaching success, what the requirements were, and how we could influence them. If I had simply proposed the projects and asked for feedback in a meeting, it would be mentally harder to audience members to make the switch from "this list is finalized and has been well-thought out" to "this list is open for discussion".

Getting honest feedback from others you trust is a great way to evaluate your own decision making process.

Weekly review

Since I started incorporating these ideas into my life and work, I  review my Decision Log on a weekly basis, and take a page to note what patterns I've observed and where I may need to try something new.

Thinking in Bets is an awesome overview of all the ways decision making can go wrong and provides a list of practical ways to overcome them.