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How to make better decisions

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When making decisions, pay attention to the factors that lead people to make bad ones: 

Relying on past experience, even when the current problem is way more complex. People tend to think past experience will be a boost, but it can actually be dangerous, says Sydney Finkelstein, co-author of Think Again: Why Good Leaders Make Bad Decisions and How to Keep it From Happening to You.

Making pre-judgments that turn out to be wrong. For example, the head of the Department of Homeland Security made early prejudgments about how bad Hurricane Katrina would be. As data flowed in, he chose to heed reports supporting his early prejudgment, rather than taking notice of not-so-rosy facts.

Attachments to people, places or things. Example: You need to forge a contract with a copy machine vendor. If you’re friendly with one of the sales representatives, that could sway your decision.

Tip: Before heading into a decision, identify the factors that affect your objectivity.

Adapted from “Why Good Managers Make Bad Decisions,” Erin White, The Wall Street Journal.


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