We are living in interesting times. With content consumption at an all-time high, and critical thinking seemingly at record lows, its easier than ever to fool yourself.In business, that can be an expensive mistake.
is when we create a subjective version of reality, its a systematic, self-imposed deviation from your normal rationale. It's searching for all information which supports your opinion, and ignoring any that does not.
We make 4 mistakes in our thinking: 1. Anchor EffectAssumption:
We have considered all factors before making decisions Reality
: Usually we trust the first 'strong' source of information whether that is about somebody we have never met, a new movie or a new 'can't lose' revenue stream: 'First impressions last' Solution
: DON'T TRUST YOUR FIRST IMPRESSIONS! 2. Confirmation ErrorAssumption
: We believe we have been objective in our assessment before making a decision Reality
: We are actually interpreting information in such a way that it confirms our assumption or, we are blocking out information in opposition to our conviction. Solution: ALWAYS ASSUME YOU ARE WRONG
3. The Availability Error Assumption
: When we believe we have good arguments for making / approving a key decision. Reality:
This is almost always due to having a poor sample size. We are making decisions based on simple, easily availble infomation that's often autobiographical ( based on personal experience). We are hiring a Polish software engineer who turns out to be proficient, and later oursourcing all software projects to Poland because 'they have great software engineers'. Solution
: DO NOT TRUST ANECDOTAL EVIDENCE 4. The Fast / Slow Error Assumption:
We have relied on intuition and believe in our decision based solely on that Reality
: Although intuitive impulse can be a great decision making tool, there are obviously times when it is not appropriate. Daniel Kahnman identifies 2 main thinking methods: (quick / intuitive) Vs (Slow / careful).
Example: A coffee and cookie together cost £1.10 and the coffee is £1 more than the cookie. How much is the cookie? If you answer quickly, most people would say £0.10 ( quick / intuitive). If you take the time though, the real answer becomes obvious: £0.05 ( slow / careful)Solution: READ EVERYTHING YOU SEND / RECEIVE AT LEAST TWICE
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