Humans are called an irrational creature. We tend to simplify anything in our surrounding especially when we have to make choices. We made various choices each day like what time to get up, what we want to eat or when we need to go to the bathroom.
Most of these cases are decided automatically since we have made these choices frequently. We will not waste energy and the answers are easily generated.
However, there’s a big problem with automatically decision making. Often, in the end, we felt that we have made the wrong decision. Thankfully, we study and learn as much information as we can in order to make a better decision. These following are the most common errors we usually make on decision making. Avoid these and you will significantly improve your business.
The Money Loss Fallacy
This the most error we all make. In many cases, decisions that we have made are final and there’s no turning back. Even if you have lost some amount of money of investment, you should clear your mind and see the situation at hand is not relevant again with the loss.
You should be a better focus on the present situation and find new options. Take aside the sunk cost you have tasted and see everything in fair-minded.
Most people would be repulsive if they face some risks even though the reward could be greater. On the other hand, you might agree if the chances you lose are extremely small. When you are in situations that would be repeated over time, it is better to take one step back and choose to play average games.
Including emotional Aspect into Decision Making
Most people ever had this kind of emotional mistake. When you are upset or angry about something, you yourself is considered as the worst decision maker. When you need to make some important decisions but having a terrible mood, you have to hold off for that moment.
Wait until your emotional feelings cool down and capable to think clearer. This will help you get rid of any unnecessary influences from the outside and allow you to think in a more rational way.
Preconception information is one of the common mistakes in the domains of the behavioral economy and psychological. The expert says that preconception information or confirmation bias can hurt the ability to maintain an open mind thus altering your opinion.
When you hold a certain belief, you typically will only see the information which confirms your opinion and ignoring other data that tells the contradictory story.
This is a situation when we are tired physically or mentally, we are bound to think an uncritical way. Some people might see this as merely intuitive sense, but this is the very aspect that mostly causes us to make bad decisions.
Try to remember the times when you are really exhausted after a long period of the conference.
These moments are exactly when you are not wanting to think anything hard. Even, you will let your brain to work spontaneously. If your condition is already tired but has to face some challenging decisions, you will rely more on your intuitive sense rather than having it analyzed thoroughly.