All decision making involves four general steps:
- Defining the goal: The first step involves defining the needs to be addressed and determining the criteria upon which alternate options will be weighed.
- Collecting information: This step involves seeking and collecting both the reliable and unreliable information required to make your decision. It involves verifying facts and accepting reliable ones while making reasonable estimates about information that you cannot verify concretely.
- Making the decision: This step involves analyzing collected data systematically to arrive at a decision regarding your goals and objectives
- Accepting feedback: This step involves following the consequences of a decision to determine whether it meets expectations and learning from feedback.
These are the most common and time-tested methods for arriving at a wrong judgment and making a fool of yourself in any situation. All of these issues related to bad decision making can be controlled and rectified, and by addressing them, you can boost and protect your career along the way.
- Jumping to conclusions: This is the hallmark of the aggressive person who wants to appear to be a fast decision maker. The problem is those fast decisions are rarely effective decisions. Remember the age-old warning "look before you leap."
- Incorrectly identifying the problem: Incorrect identification of the problem leads to wrong definitions of the goal and causes people to overlook real objectives and disregard their best options.
- Incorrectly defining the problem: Even when someone has correctly identified the problem, preconceptions, lack of information, bias, or undue influence from other decision makers can lead him or her to define the problem incorrectly. To solve a problem properly, based on the best available options, one needs to define the problem in multiple ways and keep his or her mind open.
- Myopic shortcuts: Too much dependence on "rules of thumb" can cause one to disregard the obvious. Trusting only the most readily available facts can lead people to make fast but wrong decisions.
- Overuse of instincts: While great decisions may occasionally come instinctively, decisions that appeal to your instincts are often wrong. The tendency to avoid a systematic procedure in decision making and to believe everything you need is inside your head commonly leads to bad judgments.
- Overreliance on groups and teams: There is nothing on record that says involving greater numbers of people in decision making equals better judgment under all circumstances. Including more smart people on a team does not automatically produce better solutions.
- Overconfidence: This is the greatest blunder and the most frequently repeated. Relying on preconceptions, being too sure of your assumptions, and disregarding contradictory information can create serious problems.
- Failure to interpret feedback: Failure to realistically assess past outcomes of similar decisions leads to mistakes in the present. Blindness caused by ego is the most common root cause of both overconfidence and failure to interpret feedback.
- Losing track of consequences: Failure to keep systematic records of the consequences of decisions and assuming that the experience gained will automatically come to your aid when you are making the next decision is a serious mistake.
- Disregarding the need to analyze your own decision-making process: Disregarding the need to assess your own decision-making process in an organized manner leads to the proliferation of mistakes.
