More Than a Feeling: The Keys to Good Decision-Making, with Baba Shiv

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Decision-Making and Emotions

Yun Ren, a visual artist from Wuhan, China, believes that thinking like an artist can lead to better decision-making.
He suggests trusting one's instincts and emotions, which play a significant role in decision-making, often subconsciously.
While emotions can introduce biases, they are also crucial for building confidence and persistence in chosen courses of action.
Relying solely on rational thinking may not always lead to optimal decisions, as emotions provide essential input for decision-making.
Storytelling is a powerful tool for influencing others' decisions, as humans naturally make sense of the world through narratives infused with emotion.
Balancing data-driven analysis with storytelling is important to avoid data paralysis and make confident decisions.
Leaders should develop both scientific and artistic skills to achieve a balance in decision-making.

The placebo effect extends to business decisions, where belief in a positive outcome can influence the interpretation of results.
A study on wine tasting revealed that the brain extracts more pleasure from wine when it believes it is tasting a higher-priced wine, even if it is the same wine.

Leaders with deep conviction can sometimes be blinded by hubris and fail to recognize mistakes or illegalities.
To avoid the escalation of commitment bias, leaders should conduct premortems to consider potential negative outcomes and balance their perspective.

Diversity in backgrounds, knowledge, and perspectives on executive teams can help mitigate the constraints imposed by experience and encourage innovation.
Leaders should be cautious about imposing unnecessary constraints on themselves and encourage a culture of experimentation and risk-taking.

Baba Shiv studies decision-making because he is a very irrational decision-maker himself.
He believes that most consequential decisions are made quickly and emotionally, rather than through rational deliberation.
He questions common assumptions about human behavior and asks why the opposite might not be true.
Diversity, including age diversity, is crucial for generating new ideas and solutions.
Shiv's research focuses on understanding the role of emotion in decision-making and challenging conventional assumptions about human behavior.