No one is free of making bad decisions.
Whether it’s in our careers or personal life – like it or not – we are going to make choices that don’t end up working out the way we hoped, planned or dreamed.
So why is this? What leads to bad decisions?
Best-selling author James Clear recently wrote a great article titled 5 Common Mental Errors That Sway You From Making Good Decisions that I found very insightful. Clear goes deep in his analysis of what leads to bad decision making, identifying some new concepts along the way.
Here’s a sneak peek, but I recommend you read the whole article.
1. SURVIVORSHIP BIAS: refers to our tendency to focus on the winners in a particular area and try to learn from them while completely forgetting about the losers who are employing the same strategy.
2. LOSS AVERSION: refers to our tendency to strongly prefer avoiding losses over acquiring gains.
3. THE AVAILABILITY HEURISTIC: refers to a common mistake that our brains make by assuming that the examples which come to mind easily are also the most important or prevalent things.
4. ANCHORING: refers to the mindset that certain frameworks of thinking can lead to investing larger than previously planned. For example, business owners have found that if you say “Limit 12 per customer” then people will buy twice as much product compared to saying, “No limit.”
5. CONFIRMATION BIAS: refers to our tendency to search for and favor information that confirms our beliefs while simultaneously ignoring or devaluing information that contradicts our beliefs.
There is some really great thinking here, and Clear does a great job of breaking each of these issues down and providing ideas on how to overcome them in the article.
So – which errors in thinking are leading you to make bad decisions?