≡ Menu
The Negotiation Blog

Why you make bad decisions

Bad+decisions_10d830_3567715I’ve got bad news for you.  Research suggests your brain is hardwired to make poor decisions.  The good news is that this explains why a lot of your negotiations go wrong.  And the even better news is that just knowing this information will offer a way out.  Let me explain.

We tend to think of rational decision-making and problem solving as a process where we evaluate multiple options, and eventually decide on the best one.

For example, if your teenage kid has driven to a party and then gotten drunk, we think they should be choosing between the multiple ways they could get home.  Should they drive home? Or is it better to take a cab, stay over, ask a friend to drive, call Mom and Dad, or maybe take the bus?

That’s the way they should be thinking, however it turns out that’s not the way their brains actually work.   In reality, most of the time their brain isn’t analyzing all these options, but is only looking at one at a time.

In fact, research shows that 69% of the time they are only looking at the one option that is staring them in the face (i.e.- driving home… drunk), and deciding whether or not they want to say yes.

Authors Dan and Chip Heath call this exaggeratedly narrow focus “whether or not” decision-making.

“Whether or not” decisions lead to suboptimal and often dangerous outcomes in life.

This should greatly concern you since those same researchers found that executives are even worse.  Studies show that in business decisions we fail to consider more than one option 70% of the time!  Am I the only one who is shocked by this discovery?

We look at a proposal, an offer or an idea and decide “whether or not” to say yes.  70% of the time our brain is blinded to the multiple options available to us and we are stuck evaluating them one by one.

This contributes to seriously suboptimal outcomes.  It leads us to think in terms of scarcity, which drives haggling and win-lose behaviors.  We become overly attached, emotional and inflexible about ideas that we like.  And it leads to a false sense of certainty about how good our decisions really are.

The advice to generate multiple options in a negotiation is not new.  What is new is the knowledge of how infrequently we do this in our lives, which partly explains why so many of our negotiations go wrong.

You may know that you “should” be brainstorming and generating multiple options before getting stuck on any one.  But research suggests you default to ignoring that advice.

My sense?  The odds are stacked against you.  Don’t rely on your “innate creativity”.   Force yourself to either write down multiple options that might solve the problem prior to a negotiation, or create a space during the conversation where that’s all parties are allowed to do.

About the author: Hi I’m Dan Green, blogger, entrepreneur, documentary film producer and negotiation specialist. I’ve helped executives negotiate deals worth up to 400 million USD. But before you read on…

0 comments… add one

Leave a Comment