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The Three Lies Beneath Rational Decision Making

There are three lies beneath rational decision making: do any of these sound familiar?

Written by: Mark Greville
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“Still a man hears what he wants to hear and disregards the rest.”

— Paul Simon, The Boxer

I’ve yet to meet a person who claims to be irrational. Everyone is convinced that they make rational decisions — this idea is at the core of theories in economics, organisations, and technology. When faced with a decision, a rational decision maker:

  1. Defines the opportunity/problem
  2. Lists all the constraints (time, budget, resources etc)
  3. Searches for all solutions
  4. Chooses the solution that gives the maximum benefit

According to Stanford Professor James G. March’s A Primer on Decision Making, this model of decision making is called a maximisation

The idea of maximisation, the concept of a rational decision maker is based on 3 lies.

The first lie is that we can predict the future, that we can know every possible solution in advance. This is absurd — no-one can see into the future.

The second lie — we can predict how we will feel in the future about a benefit or consequence. The feeling we get after an event is rarely the feeling we had expected beforehand. To quote tennis great Andre Agassi from his autobiography.

“‘Now that I’ve won a slam, I know something very few people on earth are permitted to know. A win doesn’t feel as good as a loss feels bad, and the good feeling doesn’t last long as the bad. Not even close.’”

— Andre Agassi

The last lie is the biggest one of all — that we have the time and brainpower to search for every potential solution that exists. The first problem here…

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