Big Decisions & Better Decisions

October 11, 2016, 9:00 am
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Nick Southgate has spoken at several FDIN Conferences about consumer decision-making. Here he turns his attention to the job-hunting to reveal what behavioural economists and decision scientists can tell us that might make choosing our next job no harder than it needs to be.

I’ve never met anyone who wouldn’t like to be a better decision-maker. We feel that our decision-making skills are most stretched by life’s ‘Big’ decisions: buying houses, choosing spouses – and which jobs to take.

When I run sessions about how to make better decisions (whether personal or business decisions) I’ve learnt that people would like a formula for turning hard decisions into easy ones. This is possible – but only up to a point. Some decisions are hard because the consequences and ramifications are far-reaching and often uncertain. Those facts and impacts remain. However, what is possible is to realise what can make a decision seem harder than it really is. Once you identify those factors you can see the decision differently and hopefully clearer. That’s what this blog piece is about.

Confidence vs certainty

Choosing a new job is a good example of where confidence is possible even if certainty is elusive. Increasing certainty in a decision can be hard. For example, we can’t actually know the future of a new employer’s business or if the launch of Isotonic Lager will turn out to be genius or folly until it actually happens.

However, increasing our confidence about the decision we are about to make is possible. Confidence makes it easier to banish the demons of indecision. It also makes the right decision more likely. Finally, and interestingly, it makes it easier to deal with regret if things don’t go to plan. We process adversity better when we feel we got there for reasons we believed in at the time.

Here are some tips selected to be particularly relevant to the process of job hunting

Look beyond the options in front of you

Psychologist, founding-father of Behavioural Economics and pioneer in decision science Daniel Kahneman identifies a phenomenon in decision-making he calls the “What You See Is All There Is” effect. In essence, we take the way a decision is presented to us at face value. This means we tend to decide as if the options presented to us to be all the options there are and all the options there are ever likely to be.

This wastes decision-making efforts when we spend too much time trying to choose between jobs we really don’t suit or want just because these are the only options we can find.

The solution to this is to be clear before you start searching what you want and need from your next job. If you don’t see it extend your search – or be patient.

The Once In A Lifetime Opportunity (or needs must)

Naturally if you’re unemployed you might feel any job is better than no job. Or if you loath your current job you may feel any alternative must be better. This turns the element of time in Kahneman’s observation into our enemy. Making ourselves feel we must choose right now makes the decision harder.

In both these cases it can be useful to reframe the status quo. If you can make your peace with your job for a while longer or make ends meet for another couple of weeks without work the range of choices, and the confidence to choose between them, can change and grow. Sometimes we really are forced to choose right now. However, we often impose a form of high-pressure salesmanship on ourselves by framing the decision this way – and this clouds the decision in front of us with unnecessary urgency. In essence, if you wouldn’t make the decision if you had more time you are heading towards a decision you will come to regret.

Others will do this too. Employers are selling jobs and everyone wants to make a job look like a ‘once-in-a-lifetime’ opportunity. Such jobs do exist. There are only so many supermarkets and each only has one CEO. However, while each employer will emphasise the uniqueness of their jobs to sharpen the decision in your favour we can counteract this by reminding ourselves how generic the job also is. This helps restore the balance so we choose clearly and not out of a misguided sense of scarcity and urgency.

Seeking Contrary Information

The doyen of decision-making science is Jonathan Baron. In his masterful Thinking & Deciding he surveys many techniques for better decision-making from simple day-to-day decision-making to high level political negotiations. In all of these approaches there is one common-step that we are all instinctive inclined to not take – seeking out contrary information.

We are all prone to confirmation bias. We notice evidence that agrees with the decision we are looking to make. In other words, we have a gut feel and look for the evidence to justify it. This is fine for many decisions, but for a more considered decision like a change of job we need to make the effort to not just confirm but double-check our gut-feel.

We can do this by seeking out the less glamorous and perhaps uncomfortable facts that our instincts about a desirable job are ignoring. How easy will the commute be? Is the investment in the business committed or promised? What’s the company’s real track record with launches? Why did the last person leave this job so quickly?

We all know the questions we should ask, but we can shy away from them. Asking them will put a decision in perspective, and, if you still feel good about it, you’ll be in a much stronger place.

An important lesson from a donkey

Imagine a hungry donkey. It stands between two equally delicious and nutritious bales of hay. Unable to decide which is the better hay to eat it starves to death. This decision-making paradox is known as Buridan’s Paradox after a 14th Century moral philosopher who felt it was impossible to choose between equally good (or bad) options.

The insight in the paradox is that decisions become harder the closer they are – and impossible when the outcomes are exactly similar.

The simple reason that we often find it hard to choose between job options is that at any point in our career the available options are far more alike than they are similar.

We tend to think that when we find a decision hard a lot is at stake. The counterintuitive conclusion we should seek solace in is that the harder we are find a decision it is often the case much less is at stake. The choices are very close and we will be fine with any of them.

Don’t worry there’s no ‘no-brainer’

What we long for are ‘no-brainer’ decisions where the reason to choose one thing over another involves no thought at all and justifies itself.

Jobs like this do come up – but not often. For most of us choosing our next job won’t be a ‘no brainer’. However, as it is an important decision we care about we should accept it might be a bit of a, to coin a phrase, ‘brainer’.

The art of a better decision is to put that effort in the right place so we’re choosing as clearly as we can and not letting the way others or ourselves frame the decision cloud our decision-making confidence. Choosing a job is probably going to be a brainer – but make it a good brainer.

Nick Southgate is a leading practitioner of Applied Behavioural Economics, working to turn the insights of Behavioural Economics, Behavioural Science and Decision Science into practical advice and solutions for companies and clients in both the private and public sector. Before becoming an independent consultant he worked for 15 years in advertising agencies including Ogilvy and Grey London as an account planner. Nick can be contacted at nick@nicksouthgate.com

 

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