Guide to Decision Making (The Economist)

Helga Drummond

ISBN 10: 1511383526 ISBN 13: 9781511383523

Publisher: Audible Studios on Brilliance Audio, 2016

An invaluable guide to arrive at better business decisions. We make decisions, and these decisions make us and our organisations. And in theory, decision-making should be easy: a problem is identified, the decision-makers generate solutions, and choose the optimal one—and powerful mathematical tools are available to facilitate the task. Yet if it is all so simple why do organisations, both private and public sector, keep making mistakes—the results of which are borne by shareholders, employees, taxpayers, and ultimately society at large?

This guide to decision making, by leading decision science academic Helga Drummond, aims to improve decision-making in organisations. It explores how and why decisions go awry in the first place—and offers practical advice on what decision-makers can do to counter the psychological, social, and other forces that can undermine individual judgment and pull organisations off course. Full of examples of good and bad decision-making from around the world, it will make listeners think more clearly about decisions big and small.

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From the Inside Flap:

In theory, decision-making is simple. The goal is defined, the possible options for achieving it identified and analysed, and the one that seems most effective is selected. No organisation makes perfect decisions all the time. Ultimately, there is nothing for it but for decision-makers to "put up the money and roll the dice." Yet there is no need for firms to learn the hard way. The starting point is to distinguish between a mistake made amid the fog of war and a systematic error of judgment. Nothing can be done about the fog of war, but systematic errors – the different types of "traps" – that result in flawed decisions are avoidable. This book is about why bad decisions are made and how to make better ones. In addition to an introduction and some closing thoughts, it has ten chapters:

Illusions of control: the confidence trap
Blinkered vision: the judgment trap
Ghosts and shadows: where is reality?
Gorilla in the room: information and decision-making
Conspiracies of optimism: group dynamics
Shifting tides: power and politics in decision-making
Predictable surprises
The march of folly: the escalation trap
Decisionless decisions: the continuity trap
Risk a little, gain a lot: real options thinking

From the Back Cover:

It is on the decisions managers make that the success of their organisations depends. Yet if it is so simple, why do businesses keep getting it wrong – and in some cases disastrously wrong?

All decisions involving uncertainty involve the risk of failure but there is also the inescapable fact that decisions are made by people and are therefore subject to human fallibility. Overconfidence, doubling up rather than admitting that a previous decision was wrong, organisational politics and turf wars, a lack of boldness or a fear of stepping out of line, a failure to spot the obvious, inadequate information, flawed assumptions or simply poor judgment are just some of the explanations for bad decisions. This book explains how to be aware of the different traps that decision-makers can fall into – and provides an invaluable guide to how to make much better decisions.

"Making the best decisions is complicated. This book reviews common mistakes associated with decision-making and gives useful practical advice on how to avoid them."
Douglas McWilliams, Professor of Commerce, Gresham College, London

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