Decisive: How to Make Better Choices in Life and Work

by Chip Heath

THE FMEA AND ITS sister technique, the premortem, stop people from focusing on a single, usually optimistic, guess about how the world will unfold and instead compel them to pay attention to the uncertainty surrounding the guess. The effort it takes to explore the full spectrum of possibilities and to prepare for the worst possible scenarios acts powerfully to counteract overconfidence. Our judgment can be wrong in multiple ways. We might err by failing to consider the problems we could encounter, and that’s why we need premortems. However, we might also err by failing to prepare for unexpectedly good outcomes. When we bookend the future, it’s important to consider the upside as well as the downside.

That’s why, in addition to running a premortem, we need to run a “preparade.” A preparade asks us to consider success: Let’s say it’s a year from now and our decision has been a wild success. It’s so great that there’s going to be a parade in our honor. Given that future, how do we ensure that we’re ready for it?

PREMORTEMS AND PREPARADES ARE most effective at tackling problems and opportunities that can be reasonably foreseen. There’s another technique that is useful in guarding against the unknown. It’s surprisingly simple, in fact: Just assume that you’re being overconfident and give yourself a healthy margin of error.

What’s remarkable here is the odd mixture of scientific precision and crude guesstimation. In computing the required strength of an elevator cable, engineers use incredibly sophisticated algorithms and tools. Then, having found the best answer that science has to offer, they take that answer and multiply it by the semiarbitrary number of eleven. It’s like an exercise that a third grader would do in a math workbook. But this crude approach saves lives, and it exhibits an admirable humility: We engineers know that we’ll be prone to overconfidence, and it’s not possible to render ourselves immune to it, so why not just correct for it? The same principle works in less risky contexts as well. Software companies have evolved their own safety factors to pad their project deadlines. Developers at Microsoft, confident in their programming prowess, will often grossly underestimate the amount of time required to reach a goal. So the leaders of the software projects, aware of the developers’ overconfidence, have learned to tack on a “buffer” factor equal to, say, 30% of the schedule.

After listening to the irate customer, applicants are asked: “Are you sure you will be able to tolerate on a daily basis assisting customers who are rude, frustrated, or confused?” On subsequent pages, applicants are warned about the difficult IT system; the stringent “on-time” policy; the requirement to work overtime and holidays; the discomfort of sharing a desk with people who work other shifts (which means they won’t be able to hang photos or otherwise humanize their work space); and the need to find a reliable way to get to work other than public transportation, since they will frequently work after the city buses have shut down. Relative to any normal hiring process, this is a serious buzz kill. It’s like a guy kicking off a first date by declaring, “I should tell you up front that I’m broke and depressed; my belly roll strongly suggests a future as a diabetic; and, like an infant, my moods tend to vary directly with my digestion. Shall we head out to dinner?”

You might assume that realistic job previews succeed by scaring away people who couldn’t have handled the job. That’s true to some extent, but it’s a relatively small factor. In fact, in some of the studies Phillips reviewed, people exposed to the job preview were no more likely to drop out of the recruitment process than other recruits who didn’t get the full, unvarnished truth.

By exposing people to a “small dose of organizational reality” before they start work, you vaccinate them against shock and disappointment.

REALISTIC JOB PREVIEWS TRIGGER our coping mechanisms, but they also spark us to think about how we’ll react. In other words, we don’t just think about tough situations; we think about how we’ll respond when we encounter them.

OVERCONFIDENCE ABOUT THE FUTURE disrupts our decisions. It makes us lackadaisical about preparing for problems. It tempts us to ignore early signs of failure. It leaves us unprepared for pleasant surprises. Fighting overconfidence means we’ve got to treat the future as a spectrum, not a point.

To bookend the future means that we must sweep our spotlights from side to side, charting out the full territory of possibilities. Then we can stack the deck in our favor by preparing for both bad situations (via a premortem) and good (via a preparade).

Even when we can’t minimize bad outcomes, we still do ourselves a favor by considering them. Realistic job previews inoculate people against disappointment and increase their satisfaction, even in the midst of a difficult job. It’s easier to cope with setbacks when we’re mentally prepared for them. Stacking the deck makes us more likely to succeed, but even with the best forethought and planning, sometimes things don’t go well. We’ve all seen people make a bad initial decision and then double down on their choice, throwing good money after bad. How do we know when it’s time to reassess a choice we’ve made? What could we learn that would make us retreat from a choice we’ve made? Conversely, what would make us redouble our efforts? What we need is a tool for snapping us awake at just the right moment, ensuring that we don’t miss a chance to cut our losses—or to maximize our opportunities.

The future is not a “point”—a single scenario that we must predict. It is a range. We should bookend the future, considering a range of outcomes from very bad to very good.

I once encountered the near horizon, mid horizon, and far horizon analogy for decision making, and then best scenario, expected scenario, and worst scenario for disaster preparedness.

To prepare for the lower bookend, we need a premortem. “It’s a year from now. Our decision has failed utterly. Why?”

To be ready for the upper bookend, we need a preparade. “It’s a year from now. We’re heroes. Will we be ready for success?”

To prepare for what can’t be foreseen, we can use a “safety factor.” • Elevator cables are made 11 times stronger than needed; software schedules include a “buffer factor.”

Anticipating problems helps us cope with them.

By bookending—anticipating and preparing for both adversity and success—we stack the deck in favor of our decisions.

Zappos, the online shoe store, has earned a reputation for exceptional customer service, and stories circulate about the company’s most outlandish service feats. In one case, a customer had traveled to Vegas, where Zappos is headquartered, only to realize that she’d forgotten her favorite shoes. So she called Zappos, hoping to buy a second pair, but the customer-service rep found that the shoes were out of stock. Unfazed, the rep hopped in his car, drove to a competitor’s store, purchased the shoes, and dropped them off at the customer’s hotel.

The offer manages to make everyone involved a little happier: Departing employees leave happy because of the check. Zappos’s execs are happy because they avoid the far more expensive prospect of managing people who aren’t a good fit. Even the employees who turn down the offer are happier. They’ve put a stake in the ground—“I’d rather be here than take the money”—in a way that feels good. Why is this offer, an artificial choice inserted into the training regimen, so effective at separating good hires from bad ones?

It’s hard to interrupt these autopilot cycles because, well, that’s the whole point of autopilot. We don’t think about what we’re doing. We drift along in life, floating on the wake of past choices, and it’s easy to forget that we have the ability to change direction.

One solution to this is to bundle our decisions with “tripwires,” signals that would snap us awake at exactly the right moment, compelling us to reconsider a decision or to make a new one. Think of the way that the low-fuel warning in your car lights up, grabbing your attention.

Inside organizations, though, it can be hard to change course, because an infrastructure gets built up around past decisions. A decision to launch a new product, for instance, creates a budget and a staff and a set of processes, all of which will tend to deter a change in direction. Because of this inertia—the deep footprints of past decisions—it can be hard for leaders to change even when they know they must.

The company’s extraordinary longevity was due, at least in part, to its leaders’ knack for reinventing their core technology. The first reinvention came shortly after the founding of the company. Eastman came to realize that glass plates, even dry ones, would never be suitable for amateurs. They were too big and fragile and expensive.

Kodak’s leaders monitored all of these developments and encouraged experimentation with digital technology in the company labs. But they never seemed to admit to themselves that the future was digital. Even when pushed by their partners and suppliers, they were slow to move. Often this reluctance emerged from a kind of scientific pride: Film is simply superior to digital. It was hard for them to imagine that the public would abandon a superior technology for an inferior one. (An ironic attitude, of course, for the company that had offended photo snobs with its Brownie camera.)

Now to think how far digital photography has come. Now a part of our lives, the default, and in fact a product differentiator outside the domain of photography equipment altogether. Phones now come in different tiers by the quality of their cameras. I was making decisions in 2000. We’ve come a long way.

Chances are you know someone who has been stuck on autopilot too long. Sometimes autopilot causes people to neglect opportunities; maybe you have a friend who has talked about writing a novel for years but never seems to make any progress. Other times, autopilot leads people to persist at efforts that seem doomed, like a couple whose relationship makes them both miserable, or a relative with a naive dream of making a living as a landscape painter, or an executive who refuses to recognize that her pet project has failed. At some point, the virtue of being persistent turns into the vice of denying reality. When that transformation happens, how can you snap someone out of it?

These will not be easy conversations to have. No one likes to be reminded of failure. Nor is there any certainty that they will change course; overconfidence is a powerful force. The optimistic entrepreneur will always believe that sales will skyrocket next year, and the aspiring singer will feel that she could be “discovered” at any moment. But certainly you have a better chance of reining in foolish decisions when those decisions are considered than when they are left unexamined.

Some venture-capital investors use a variety of this partitioning logic. Rather than investing a huge chunk of money up front, the investors might choose to dole it out over time, across a series of rounds. Each round would initiate a new conversation: Do we have the right plan? Are customers happy with what we are producing? The partitions compel the entrepreneurs to be intentional about their behavior.*

Boundaries are necessary because of people’s tendency to escalate their commitment to their choices. For a simple example, think of a kid playing an arcade game. She’s been on a zombie-killing mission, but she made a mistake and her character died, and now she must burn a few more credits to keep playing. It feels so hard to walk away at that point. She might have invested several dollars and 20 minutes to get where she was. If she walks away, she “loses” everything. Isn’t it worth a few more credits to keep going? This is a conscious decision, not an “autopilot” choice. But there’s still a trap involved, because if she doesn’t interrupt the cycle at some point, she’ll burn through all her arcade money having never played another game. (And that is not a recipe for happiness.)

Of course, the same idea is applicable to opportunities as well as threats. Organizational leaders need people to be sensitive to changes in the environment and to be brave enough to speak up. Here’s something new. Here’s a great opportunity for us. Peter Drucker challenged executives to capitalize on “unexpected success.” He wrote: When a new venture does succeed, more often than not it is in a market other than the one it was originally intended to serve, with products or services not quite those with which it had set out, bought in large part by customers it did not even think of when it started, and used for a host of purposes besides the ones for which the products were first designed. If a new venture does not anticipate this, organizing itself to take advantage of the unexpected and unseen markets … then it will succeed only in creating an opportunity for a competitor.

By coaching people to recognize patterns of threat or opportunity, you can take advantage of a phenomenon we’ve all experienced, the “seeing it everywhere” effect: You learn a new concept or word and suddenly you start to notice it everywhere.

The end goal is to make customers happier, which means not only that you’ve picked the right solution but that your staff is using it enthusiastically in a way that pleases customers. In other words, success requires two stages: first the decision and then the implementation.

The elements of procedural justice are straightforward: Give people a chance to be heard, to present their case. Listen—really listen—to what people say. Use accurate information to make the decision, and give people a chance to challenge the information if it’s incorrect. Apply principles consistently across situations. Avoid bias and self-interest. Explain why the decision was made and be candid about relevant risks or concerns.

True, there may be times when we value our own idea more than a fair process and times when we choose expediency over procedural justice.

The same goes for defending a decision. If you’ve made a decision that had some opposition, those opponents need to know that you haven’t made the decision blindly or naively. Our first instinct, when challenged, is usually to dig in further and passionately defend our position. Surprisingly, though, sometimes the opposite can be more effective.

Dave Hitz, the founder of NetApp, says he learned that “sometimes the best way to defend a decision is to point out its flaws.” In his funny autobiography, How to Castrate a Bull, he explains how he handles opposition: Let’s say you have decided to pursue Plan A. As a manager, it is part of your job to defend and explain that decision to folks who work for you. So when someone marches into your office to explain that Plan A sucks, and that Plan Z would be much better, what do you do? … My old instinct was to listen to Plan Z, say what I didn’t like about it, and to describe as best as I could why Plan A was better. Of course, the person has already seen these same arguments in the e-mail I sent announcing the decision, but since they didn’t agree, they must not have heard me clearly, so I’d better repeat my argument again, right? I can report that this seldom worked very well. It works much better if I start out by agreeing: “Yep. Plan Z is a reasonable plan. Not only for the reasons you mentioned, but here are two more advantages. And Plan A—the plan that we chose—not only has the flaws that you mentioned, but here are three more flaws.” The effect of this technique is amazing. It seems completely counterintuitive, but even if you don’t convince people that your plan is better, hearing you explain your plan’s flaws—and their plan’s advantages—makes them much more comfortable. Hitz’s logic defies our natural PR instincts. Aren’t we supposed to vociferously defend our posit...