Decisive: How to Make Better Choices in Life and Work

by Chip Heath

The future has an uncanny ability to surprise. We can’t shine a spotlight on areas when we don’t know they exist.

LET’S SUM UP WHERE we are. If you think about a normal decision process, it usually proceeds in four steps: • You encounter a choice. • You analyze your options. • You make a choice. • Then you live with it. And what we’ve seen is that there is a villain that afflicts each of these stages: • You encounter a choice. But narrow framing makes you miss options. • You analyze your options. But the confirmation bias leads you to gather self-serving information. • You make a choice. But short-term emotion will often tempt you to make the wrong one. • Then you live with it. But you’ll often be overconfident about how the future will unfold.

Sometimes the hardest part of making a good decision is knowing there’s one to be made.

In life, we spend most of our days on autopilot, going through our usual routines. We may make only a handful of conscious, considered choices every day. But while these decisions don’t occupy much of our time, they have a disproportionate influence on our lives.

The psychologist Roy Baumeister draws an analogy to driving—in our cars, we may spend 95% of our time going straight, but it’s the turns that determine where we end up.

To make better decisions, use the WRAP process: Widen Your Options. Reality-Test Your Assumptions. Attain Distance Before Deciding. Prepare to Be Wrong.

According to Paul Nutt’s research, then, most organizations seem to be using the same decision process as a hormone-crazed teenager.

Parents are often shocked, too, to hear that, once you control for aptitude, a person’s lifetime earnings don’t vary based on what college they attended. In other words, if you’re smart enough to get into Yale, it doesn’t really matter (from an income perspective) whether you go there or instead choose your much cheaper state university.

Focusing is great for analyzing alternatives but terrible for spotting them. Think about the visual analogy—when we focus we sacrifice peripheral vision.

a generic form of the Vanishing Options Test, which you can adapt to your situation: You cannot choose any of the current options you’re considering. What else could you do?

This is a critical point: Multitracking keeps egos in check. If your boss has three pet projects in play, chances are she’ll be open to unvarnished feedback about them, but if there’s only one pet project, it will be harder for her to hear the truth. Her ego will be perfectly conflated with the project.

Many executives are worried that exploring multiple options will take too long. It’s a reasonable fear, but the researcher Kathleen Eisenhardt has found that the opposite is true. In a study of top leadership teams in Silicon Valley, an environment that tends to place a premium on speed, she found that executives who weigh more options actually make faster decisions.

Managers need to push for legitimate alternatives, not sham options. To diagnose whether your colleagues have created real or sham options, poll them for their preferences. If there’s disagreement, that’s a great sign that you have real options. An easy consensus may be a red flag.

Psychologists have identified two contrasting mindsets that affect our motivation and our receptiveness to new opportunities: a “prevention focus,” which orients us toward avoiding negative outcomes, and a “promotion focus,” which orients us toward pursuing positive outcomes.

Yet the wisest decisions may combine the caution of the prevention mindset with the enthusiasm of the promotion mindset.

When you use analogies—when you find someone who has solved your problem—you can take your pick from the world’s buffet of solutions. But when you don’t bother to look, you’ve got to cook up the answer yourself. Every time. That may be possible, but it’s not wise, and it certainly ain’t speedy.

Warren Buffett said, “In the past, I’ve observed that many acquisition-hungry managers were apparently mesmerized by their childhood reading of the story about the frog-kissing princess. Remembering her success, they pay dearly for the right to kiss corporate toads, expecting wondrous transfigurations.” Unfortunately, said Buffett, “We’ve observed many kisses but very few miracles.

To make good decisions, CEOs need the courage to seek out disagreement. Alfred Sloan, the longtime CEO and chairman of General Motors, once interrupted a committee meeting with a question: “Gentlemen, I take it we are all in complete agreement on the decision here?” All the committee members nodded. “Then,” Sloan said, “I propose we postpone further discussion of this matter until our next meeting to give ourselves time to develop disagreement and perhaps gain some understanding of what this decision is about.”

We want to avoid the momentary discomfort of being challenged, which is understandable, but surely it’s preferable to the pain of walking blindly into a bad decision.

experts are pretty bad at predictions. But they are great at assessing base rates.

In short, when you need trustworthy information, go find an expert—someone more experienced than you. Just keep them talking about the past and the present, not the future.

Another variety of close-up involves going to the genba, a Japanese term meaning “the real place” or, more loosely, the place where the action happens. Japanese detectives, for instance, call the crime scene the genba. In a manufacturing firm, the genba would be the factory floor, and for a retailing company it would be the store. Practitioners of Total Quality Management encourage leaders to “go to the genba” to understand problems.

One trait did prove predictive, though: media attention. Specifically, experts who made more media appearances tended to be worse predictors.

Entrepreneurs don’t seem to believe that forecasting is worth the bother: One survey found that 60% of Inc. 500 CEOs had not even written business plans before launching their companies.

Ooching, in short, should be used as a way to speed up the collection of trustworthy information, not as a way to slow down a decision that deserves our full commitment.

That’s why the folk wisdom advises that when we’ve got an important decision to make, we should sleep on it.

When an organization’s leader proposes a change in direction, people will be feeling two things: Ack, that feels unfamiliar. (And thus more uncomfortable.) Also: Ack, we’re going to lose what we have today. When you put these two forces together—the mere-exposure principle and loss aversion—what you get is a powerful bias for the way things work today.

The researchers have found, in essence, that our advice to others tends to hinge on the single most important factor, while our own thinking flits among many variables. When we think of our friends, we see the forest. When we think of ourselves, we get stuck in the trees.§

This is one of the classic tensions of management: You want to encourage people to use their judgment, but you also need your team members’ judgments to be correct and consistent.

“guardrails that are wide enough to empower but narrow enough to guide.”

the success of realistic job previews seems to be driven by what Phillips calls a “vaccination” effect. By exposing people to a “small dose of organizational reality” before they start work, you vaccinate them against shock and disappointment.

Realistic job previews have been shown to reduce turnover even when they are given after the employee is hired. The previews are not just helping the “wrong” people opt out of the hiring process; they’re helping all people cope better when they confront the inevitable difficulties of the role. In fact, realistic job previews not only reduce turnover but also increase job satisfaction.

Deadlines focus our mental spotlight on a choice. They grab us by the collar and say, If you’re gonna do this, you have to do it now.

In this light, consider the tradition of the annual performance review for employees. People (including us) have poked fun at the idea of giving feedback to employees only once a year. (What parents would swallow their feedback day after day, storing it up for one December day when they’d sit their kids down and let it rip?)

In the terminology of the researchers Dilip Soman and Amar Cheema, the small bag acts as a “partition.” It breaks up a resource (chips) by dividing it into discrete portions. Soman and Cheema have found that partitioning is an effective way to make us more thoughtful about what we consume, because it forces us to make a conscious decision about whether to continue.

does prayers act like partitions to our day, so we can consume time more wisely?

This kind of partition effect probably explains why credit cards encourage excessive spending—they permit us to spend without partitions, like eating from a bag of chips the size of your couch.

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.

In other words, success requires two stages: first the decision and then the implementation.

That’s why the initial slowness of bargaining may be offset by a critical advantage: It speeds up implementation.

So where do you want to spend your time? Bargaining up front, or fighting foot draggers later? Bargaining yields buy-in.

he says, “I state back the other side’s position better than they could state it. And then they can relax because they feel heard.” When you can articulate someone’s point of view better than they can, it’s de facto proof that you are really listening.

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.