Making Good Decisions is a Competitive Advantage
The Irresistible Pull of Irrational Behavior
Written by Ori Brafman and Rom Brafman
Have you ever found yourself shaking your head in disbelief at a decision a friend or colleague made?
Have you ever wanted a “do over” yourself?
You know—you made a decision that was so bad that you longed for the opportunity to just do it over completely?
All of us, at one time or another, have made a bad decision. These errors in judgment are often costly—emotionally and financially. And while we would all like to think of ourselves as smart, savvy businesspeople, we are programmed to respond to certain circumstances in predictable ways. You read that correctly. Our behavior is influenced by the way our brains are wired.
Ori and Rom Brafman have set out to help us recognize when we are behaving irrationally. In their recently released book, SWAY: The Irresistible Pull of Irrational Behavior (published by Doubleday), they not only reveal the key triggers of this behavior but they help us take some steps to avoid reacting based upon pure emotion when the stakes are particularly high.
It is pretty rare for a book to have immediate practical application in our lives and our businesses. SWAY is a rare find because it provides us with a how-to guide to identifying and avoiding the irrational traps we have all fallen victim to at one point or another. You will not only find this book an entertaining read but also a valuable reference to help you break the spell of your own emotional nature when making your next big decision.
Among the many interesting anecdotes are stories of losses sustained by smart people who have made irrational decisions when the stakes were high. Here are a few of the invisible forces highlighted by the brothers Brafman as they attempt to keep us from being defeated by our own worst enemy—our subconscious mind:
Fear of Loss
Fear is a huge factor that drives our behavior. This is especially true when we feel as though we are going to miss out on something. The fear of loss can motivate us to do things we would never consider otherwise. The authors give us dramatic examples of this psychological force impacting (and ending) the lives of intelligent people.
It is precisely this fear that led an airline safety expert to make a decision that literally killed hundreds of passengers. The authors use this compelling story to highlight how even the most highly trained experts can become lulled into a false sense of security.
Recognizing the effect this particular sway has on us will not only help you avoid making terrible purchase decisions, it may just save your life!
Past Commitment Influencing Future Decisions
Sometimes “sunk costs” can kill a business in multiple ways. This is particularly true when we have “sunk emotions” involved in our decisions. Once we humans commit to something, whether it is a particular vendor in the business world or a top draft pick in the National Basketball Association, we are committed. And we will do almost anything to make sure our decision was a correct one, even if that means pouring more time, money, and effort into a losing proposition.
In this sense, when we make important business decisions, we become married to them— it becomes psychologically difficult to break free of these commitments if things do not go as planned. Many times we stick with our decisions even though there is little chance that things will work out or turn around.
As we read the stories in SWAY, we realize that the cliché Throwing Good Money after Bad is 100% accurate. People often stick with bad decisions for a longer period of time if they “fell in love” with that decision in the first place.
We often see things the way we want them to be and not as they actually are. Once we become wrapped up in the heat of the moment, it is difficult to remain objective about anything, from a business deal to whom we are dating.
In our minds, we assign a value to something (and even to relationships) and once that value has been attributed to that object, it becomes almost impossible to see the object in any other light.
This is the reason that some people are willing to pay enormous sums of money for art at an auction. It is also the thinking behind some of the astronomical contracts professional athletes can command. The team owners and the fans of the team have mentally assigned a certain value to a player even before he has performed in that team’s uniform. While he may have been a superstar in Kansas City, there is no guarantee that he will play the same way in the bright lights of New York City. Yet the athlete is “worth” the big contract in the mind of the team owner.
How many times have you heard a small child say: “But it’s not fair!”?
That is the essence of the fairness trap highlighted by the authors. We want to see the world as a balanced place where good people are rewarded and the “bad guy” loses.
In important decisions that affect others, people tend to care about the process as much as they care about the outcome. Even if we do everything right in a given situation, people may still feel that they have been given a bad deal—if they have not been involved in the decision-making process.
Let’s say, for example, that you are revising the lunch menu for your office’s next outing. If you did not check with the members of your team prior to scheduling the meeting, your group may not think the process was conducted fairly—even if they agree with the choice of food you selected.
It is this innate sense of fairness that can derail otherwise good decisions, in effect swaying people from the desired outcome toward a less desirable outcome.
These are just a few of the many irrational sways that we all are victims of at one time or another. Ori and Rom Brafman not only provide us with some terrific examples, they also help us break the spell this irrational behavior holds over us.
Don’t allow your own psychological issues to control your behavior!
Pick up a copy of SWAY today and you’ll be on the path to winning the battle with your own most powerful enemy—your subconscious mind.
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