Avoiding the Sting of Poor DecisionsScott Dannemiller is an excellent classroom facilitator and an enjoyable storyteller and he recently shared the following episode on social media. The story provides a helpful background for a decision making bias that is prevalent surrounding emotionally charged events. Here’s Scott’s story:
My nine-year-old son recently asked what he could do to earn some money. My wife gazed out on the now defunct cement Koi pond in the back yard of our new home and said, “I’ll give you fifty bucks to break up the pond and haul it away for us.”
My son’s eyes grew wide, “Fifty bucks! Dad, can you show me how to do it?!” To him, fifty dollars is big money. Trump money.
So I went into the back yard with a sledgehammer as Jake watched, patiently waiting his turn. No sooner had I delivered five or six hard blows to the side of the pond when both he and I were engulfed in a swarm of yellow jackets. Apparently, their nest was underneath the pond, and they were none too happy about our eviction plans.
My son ran, screaming at the top of his lungs. I chased him, hoping to protect him from the onslaught. The attackers covered us from head to toe, attaching themselves to our clothing. So, we stripped down to our underwear right there in the driveway and ran toward the safety of our house. I’m sure our new neighbors were impressed. It was both hilarious and terrifying.
We were both stung multiple times, with my son receiving the worst of the damage. That night, while loading my boy with Benadryl, I called the exterminator, who was more than happy to come out the next day and take care of the nest. I asked him what the service would cost, but honestly, at that point, anything under $10,000 would have been OK by me. So, I was happy when the final bill was just $225.
Later, as Scott reflected on the episode, he realized that he had fallen victim to one of the classic cognitive biases that plague organizational decision making. The Recency Bias occurs when recent, highly emotional events cloud our decision making and cause us to react in impulsive ways. Here are some tips to assure you don’t unconsciously spend time and energy on unnecessary plans and projects.
1. Recognize The Decision Bias: Be aware that you are at risk for bias when you are reacting to an emotionally charged event. Had Scott talked to friends and/or surfed the web, he could have identified ways to exterminate the hive himself, which would have cost next to nothing. And the same is true in companies today, when painful failures lead to overreaction and unnecessary spending.
2. Quantify The Risks: When strange problems occur, no matter how remote the chances, the Recency Bias causes us to believe the likelihood of the problem is greater than it actually is. Scott had been operating power tools near the pond for over four weeks, but it was only when they directly disturbed the nest that disaster happened. Assessing your real risk outside of the emotional event gives you some perspective, and allows more brain space to explore the decision alternatives.
3. Explore Alternatives: When we are highly emotional, it is also easy to get trapped in another cognitive bias, the False Dilemma. When trapped in the False Dilemma, we frame decisions as either/or decisions. We either choose A or B. Go, or no-go!. In truth, there are always multiple alternatives, and taking even a brief moment to explore them allows us to identify other potential solutions that solve our problem and minimize risks.
At Action Management Associates, we have been helping clients identify risks and make decisions for over three decades. If you would like to avoid getting stung by cognitive biases and poor decision making, give us a call at 1-800-386-5611! We’d love to help.
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