Lecture Outline: The Three Secrets of Wise Decision Making, Chapter Two


I.   The Three Secrets:  used in the management of complexity

            a.  Courage: to be rational in problem solving

            b.  Creativity : complete understanding of the problem and all available options

            c.  Balance:  judgment of the problem from all sides allowing the best alternative                                             to emerge

                        *The Three Secrets:  secrets to different people

                              -Balanced Judgment:  secret to those trying to make decisions without                                                                           formal training, focus on evaluating decisions in                                                              their head without formal analysis

                                - Courage is rarely mentioned by decision scientists

                                - decision makers and decision scientists understand the importance                 

                                  of creativity, but do not promote it          

II.  Rationality: direction in thought

            a.  Rational decision  making

                        - begins with fact and value premises

                        - proceeds to a logical conclusion and a  preferred alternative

            b. Example of insufficient courage to make a rational decision:

                        - parents, bosses, politicians resist admitting weakness or failure in a                  

                          course of action they have advocated regardless of the evidence against        


III. Creativity: richness of thought

            a.  Creative decision making

                        - considers a broad range of alternatives

                        - maintains bases for evaluating alternatives 

                        - maintains awareness of any event that might occur which could alter the 

                           value of an alternative option

            b.  Example of failure in creative decision making:

                        - frequency of  times decisions are made and a better alternative comes to 

                          light after having committed to the lesser option

IV. Judgment: balance of thought

            a.   Judicious decision making

                        - considers various facts and values

                        - relates facts and values in proportion to their importance

            b.  Examples of failure in proper judgment:

                        - young people who fail to attach proper importance in planning for their  

                          working years, adults who fail to attach proper importance in planning                 

                          for retirement, society that fails to attach proper importance in planning 

                          for future generations






V. Cognitive Conflict: motivational concept; understanding courage, creativity, and 


            a.  Related to:

                        - amount of uncertainty about the consequences of various alternatives

                        - importance of those consequences

                        * Equation: Cognitive Conflict = Importance x Uncertainty

                                    - if importance is zero, no amount of uncertainty will produce       

                                      cognitive conflict

                                    - if uncertainty is zero, no amount of importance will produce  

                                      cognitive conflict

                                    - If cognitive conflict increases, emotional arousal increases; and 

                                      as arousal increases, attention narrows

            b. Levels of Cognitive Conflict:

                        - Low Levels:  attention is broadly diffused and quickly turns to other 

                                               matters, easily distracted

                        - Moderate Levels: attention is properly focused  on the task at hand , 

                                                       openness to problem-relevant information; feelings of 

                                                       interest, engagement and challenge

                        - High Levels: development of tunnel vision concerning the task to the  

                                                point where important considerations are ignored; too 

                                                highly motivated, experience panic

            c. Levels of Interest in Decision Making:

                        - “Cold:” not likely to give the decision much thought

                        - “Warm:” best work is done on decision problems at this level

                        - “Hot:” try to resolve the problem too quickly, not enough consideration

            d. Solutions: finding a balance between levels of Uncertainty and Importance

                        - Low Uncertainty: add alternatives through creative thinking, consider                                                          what is wrong with preferred alternatives and what is       

                                                       good about non-preferred alternatives

                        - Low Importance: become more emotionally engaged, imagine that the                                                                    solution is due tomorrow, it is entirely your                                                                                responsibility, and you will suffer consequences for not                                                       meeting the deadline

                        - High Uncertainty: broaden the focus of the decision making process to                                                                   encompass all aspects instead of focusing on one facet                                                               of the problem, reduce complexity through external                                                             memory, heuristics, or decomposition **definitions                                                          and page numbers on the following page**







                                    (High Uncertainty continued)

                                    *external memory: “In sight, in mind.” The opposite of “Out of                                                                                site, out of mind.” (i.e. tying a string to your                                                                               finger to remember a task, p.53)

                                    *heuristics: educated guess that helps find a solution to a problem,

                                                       mechanisms for efficient search  (p. 57)

                                    *decomposition: strategy of “divide-and-conquer,”  break the                                                                 problem down and analyze the basic components                                                                      (p. 60)

                        -High Importance: create emotional distance from the problem (i.e.                                                              discuss the problem with others, prepare for the worst,                                                        ask yourself how you would advise someone else in                                                                    your situation)                            

            e. Process Orientation: reduce importance and uncertainty through redirecting                                                     attention from the outcomes of the decision to the decision                                              making process itself

                        -place more importance on making a fair, rational, good decision than the                                   “right” decision

                        -reduction of importance and uncertainty allows for tolerance of greater                                      complexity in a decision problem and achievement of higher quality                                      solutions

            f. Interest: caused by an intermediate level of conflict

                        - creative thought during problem solving, increased conflict and                                                  judgment during evaluation, results in one chosen alternative, conflict is                                reduced below the interest level and attention is diverted to other matters

            g. Boredom: caused by a low level of conflict

                        -level of conflict is too low to generate interest and stimulate thought,                              results in no problem solving activity

            h. Panic: caused by a high level of conflict

                        -high conflict levels result in discomfort and desperation to eliminate the                           discomfort, no problem structuring only simple hasty evaluations to come                       to an easy solution

            i. Defensiveness:  caused by relatively low levels of conflict

                        -personal threat closes options for unbiased problem solving, defense                             mechanisms reduce conflict to the point where it seems uninteresting, the                   problem is not solved and will resurface









VI. Secret One: The Courage to be Rational

            -Recognizing Lack of Rationality: caused by decision avoidance

            a. Representational Beliefs: represent reality in an unbiased fashion

            b. Challenged Representational Beliefs: results in cognitive conflict, stimulates                                                                                 unbiased problem solving, leads to better                                                                                       decision making

            c. Self-Enhancing Beliefs: function to reduce cognitive conflict and allow us to                                                           feel good about ourselves (i.e. religion, politics)

                        -many times these beliefs are not tested because we feel they are correct                                    and we fear the answers that might result from testing

            d. Rational Beliefs: requires optimal level of cognitive conflict and hope

                        -a belief is not rational if it is accepted or rejected based on the degree to                                   which it conforms to the believer’s self-concept, lifestyle, or feelings

                        -Do I Have the Courage to be Rational? Ask yourself: “Would I be willing                       to commit to and actually follow through on whichever of the                                              alternatives the analysis indicates is the best?”

            e. Irrational Beliefs: reduce importance and uncertainty, increase hope

                        - may reduce the perception of importance through shifting responsibility                                      or procrastinating (saving the problem for the “future self”)

                        -may conduct a biased search for information confirming the desired                               belief and avoiding information that disconfirms the belief

                        -both importance and uncertainty reduced in this way leads to distorted                                      reality and premature reduction of cognitive conflict, this takes away the                              stimulus for creative thinking that could lead to genuine problem solving                                 and decision making

            f. Bolstering:

                        -reduces perceived uncertainty by biased thinking that strengthens what                                      we are committed to and weakens other options

                        -Warning Sign: too many options pointing in the same direction, the                                                         weaker the belief, the more people feel they need to                                                       support it

            * “The person thinking rationally will respond with interest to challenging                           information, whereas the person thinking irrationally will respond with emotion        and resistance.” (p.25)

            g. Escalating Commitment: investing in a bad decision and being inclined to                                                                  invest more to turn it into a good decision

                        -making a commitment to a bad decision makes us feel that it is a                                                reflection on us as decision makers, which is why we try so hard to justify                          the bad decision (i.e. Vietnam War)

                        -reduce cognitive conflict by reducing the importance, set commitment                            limits in advance, view the conflict from the other party’s perspective and                         if it looks equally as attractive from there…something is wrong



            h. Hope: directional, avoiding irrationality

                        -the belief that rational, unbiased decision making will result in the best                                        decision

                        -the belief that we have good problem solving skills, adequate resources, a                      proven history of problem solving

                        -know how to break problems down into basic components for analysis

                        -discuss problems with others who are a positive resource

                        -practice problem solving skills with less intense problems for future                                preparation

            i. Positive Attitudes for Decision Making:

                         -we don’t have to make decisions by ourselves

                         -we don’t have to be right on the first try

                         -we don’t have to be exactly right, even in the end

                         -we don’t have to be able to think about everything at once

                         -we can learn from our mistakes

*”We are most likely to be successful if we are uncommitted during decision making and    

  committed afterwards.” (p.30)

VII. Secret Two: Creativity

            a. Creative Thinking:

                        -a new generation of ideas

                        -these ideas satisfy some standards of value

                        -decision problems are structured in terms of alternatives, values and                              events creativity is necessary to ensure that all possible alternatives are                                considered

            b. Recognizing Lack of Creativity:

                        -fear of new ideas

                        -inability to come up with new ideas

                        -coming up with the same ideas over and over again

                        -Remedy: stimulus variation

            c. Stimulus Variation:

                        -Controlled Process: limited capacity of working, or active, memory; the                                                                             working memory can hold a string of  7 unrelated                                                                      numbers on average, average of 5 unrelated words

                        -Automatic Process: thinking in terms of patterns laid down in long-term                                                                     memory, can greatly improve the working memory,                                                                   but can lead to reduced creativity due to working with                                                       familiar patterns, associative patterns often revisit the                                                       same ideas

                                                            -perspectives are based on automatic processes                                                                         which results in difficulty changing perspective

                                                            -Priming: once ideas have been activated in                                                                                               working memory they remain ready for a                                                                                   few days to allow for quick access


                                                            -Priming and Associations create a box that is                                                                difficult to see out of during problem solving,                                                                  however they are generally useful tools

                        -Force Fit: attempt to turn a foolish idea into a workable solution

                                                - when exercising creativity in problem solving it is                                                                       important to find merit in as many ideas as possible, even                                                           foolish ones

                                                -this requires evaluative judgment, keeping the problem in                                                           mind

                        -Phases of Force Fitting in Decision Making:

                                    1. Come up with a foolish “stepping stone” where no evaluation is                                                  employed. This is stimulus variation in the problem-structuring                                            phase.

                                    2. When moving from the “stepping stone” into a potential                                                              solution, only positive evaluation should be employed. This is                                              force fit in the problem-structuring phase.

                                    3. When evaluating potential solutions, both positive and negative                                                   evaluations should be employed. This is the evaluative phase.

                        - General Points for Stimulus Variation:

                                    1. No need to use creative thinking techniques as long as we are                                                    coming up with ideas, wait until no new ideas are coming or the                                                     same ideas are coming up over and over.

                                    2. Force Fit must be applied to get from the “foolish” stepping                                           stones to truly creative ideas.

                                    3. The techniques are most effective when applied first to values,                                                   then alternatives, then events; and if applied to big-picture                                                  considerations, rather than details.

                                    4. No need to use every technique, only the ones that appeal to                                                     you. The other ones can be tried when you have more time.

            d. Five Techniques for Stimulus Variation:

                                    1. Mood: important internal stimulus

                                                -people who are in a good mood tend to come up with more                                          ideas

                                                -people who are in a good mood tend to come up with more                                          ideas that go beyond the narrow scope of ideas to the                                                    broader spectrum, creativity

                                                -being in a good mood should be congruent with feeling                                                              hope, not time pressure

                                    2. Observation: fundamental implementation of stimulus variation

                                                -thoughtful/mindful observation of the surrounding world

                                                -getting the facts straight is a good way to get problem                                                    solving ideas

                                                -when stuck on a problem, going through the facts again is                                                          helpful


            * “Careful observation and careful attempts to establish and understand                                        the facts, pretentious as they may sound, may very well be the best                                      source of ideas.” (p.42)

                                    3. Creative Conversation: stimulates internal stimuli

                                                -new internal stimuli are created when we speak and write

                                                -new external stimuli is experienced when other people                                                   speak

                                                -people with different experiences and perspectives have                                                            the potential to think more adequately about a problem                                                              together than they ever could alone, combining expertise                                                     and knowledge

                                                -talk with others about decision problems

                                                -it is important to apply force fit for creative conversation                                                            to work

                                                -think constructively about what you are saying and hearing                                            in a conversation

                                                -Specific Variations: talking with others

                                                            i. The Devil’s Advocate: provides arguments                                                                                         against the prevailing direction of                                                                                               the group

                                                                        -first formulated by the Roman Catholic                                                                                      Church as part of its canonization process

                                                                        -works best when people merely question                                                                                   the assumption on which the dominant                                                                                       alternative is based, rather than becoming                                                                                    an advocate of that point of view

                                                            ii. Giant Fighter’s Stratagem: use of the thoughts                                                                                      and knowledge of experts to help us                                                                              structure our decision problem

                                                                        -use of intelligence to redirect the superior                                                                                   force of others to one’s own advantage (i.e.                                                                  salesman admitting that a competitor’s                                                                               product is superior to their own, provides                                                                                       confidence in decision making as a                                                                                            consumer)

                                                            iii. Networking: Who else would you suggest I talk                                                                                               with?

                                                                                      Who would be likely to disagree?

                                                                        -when seeking relevant information from                                                                                     anyone, ask whom else you should speak                                                                                  with in regards to the topic at hand

                                                                        -greatly expands the range of stimulus                                                                             variation in creative conversation


                                    4. Breaks: allows time for internal and external stimuli to vary on                                                                 their own

                                                            -*incubation: getting an idea during interruption in                                                                                           work on a problem

                                                            -stimulus changes during a break can occur in                                                                 waking life or in dreams

                                                            -in dreams, stimulus variations are related to                                                                   whatever problem was being worked on that day,                                                                     this is an effect of priming

                                                            -in waking life, stimulus variations won’t                                                                                     necessarily bear any efficient relationship to the                                                                          problem that is at hand  

                                                            -Remedy to this concern:

                                                            i. Use the break to work on related problems.

                                                            ii. Become deeply immersed in the problem before                                                                        taking the break so that a broad range of daily                                                                           experience will be seen as problem relevant.

                                    * “Make your decision problem a high priority, and then live with                                                  it and sleep on it.” (p. 47)

                                    5. Checklists: easiest technique for stimulating ideas

                                                            -expose yourself to a large number of stimuli in a                                                                        short period of time by simply looking at a list of                                                                        items related to your problem

                                                            -discover checklists that are relevant to the problem                                                        at hand

VIII. Secret Three: Balanced Judgment

            a. Judgment: weighing various considerations, quantitative task

                        -good judgment is attaching proper weight to each of the various                                                considerations

                        -bad judgment is attaching inappropriate weight to considerations

                        -in social contexts judiciousness shows itself as fairness or                                                          evenhandedness

                        -in decision making judiciousness involves assigning appropriate                                                  importance to various values, and appropriate probabilities to various                                   possible futures

                        -requires consistency among ideas, and consistency between ideas and                           observations


            b. Recognizing Lack of Balanced Judgment:

                        -when a decision turns out badly, the situation is evaluated with the same                                     faulty judgment that led to the decision in the first place

                        -this leads to easily blaming our failure on external circumstances



                        -Warning Signs:

                                    1. A single alternative: when considering a single alternative,                                                                                remember the value of comparison                                                                                            shopping

                                    2. A single value: when considering a single value, remember the                                                                            danger of single-issue thinking, all values are                                                                  important and should be taken into consideration                                                                         during decision making

                                    3. A single future: when considering a single future, remember that                                                                planning for a single future is limiting since it is                                                                likely that the future we prepare for might not                                                                      be the future that occurs

                                    4. All considerations point to the same alternative: when all                                                                          considerations point to the same alternative                                                                    consider that even the best alternatives have                                                                      drawbacks

                                                                  - simple problem representations tell more                                                                       about the limited capacity for thinking about a                                                                            complex world than they tell us about the                                                                              world itself

                                    5. Vacillation: when drawn to one alternative on some occasions                                                                        and different alternatives on other occasions,                                                                 remember that there might be too much to keep in                                                                mind all at once

                                                            -this vacillation could be caused by focusing limited                                                         attention on different samples of relevant                                                                                    considerations at different times

                                    * “Resistance accompanied by emotionality suggests irrational                                          defensiveness against the new idea; ready acceptance suggests                                         that the decision maker was simply not creative enough to come                                              up with the new idea; resistance accompanied by confusion and                                          cognitive strain suggests lack of capacity to deal with the new                                                    idea along with all others.” (p.51)

                        -when information is being excluded is important to consider whether the                                    information is genuinely unimportant (good reason), or because it puts us                              into cognitive overload (bad reason)

                        -Solution: supplement working memory with external memory or priming                                                    and fit the problem to the available memory through heuristics                                            and decomposition






            c. Controlled Processes with Limited Capacity:

                        -if the decision process is encountered infrequently (i.e. buying a house)                                      we are not likely to have chunks in long term memory to aid working                                   memory and enlarge its capacity

                        -Limited capacity contributes to poor judgment:

                                    1. We can only hold a certain amount in working memory                                                              excluding much information from consideration.

                                    2. Our capacity for thinking about what is in working memory is                                                    limited, many of the distinctions among items in working                                                    memory may fail to be considered and, therefore, inadequately                                             weighted.

                        -we adjust to the limited capacity of working memory by thinking about                                      the most important considerations, however perspectives and situations                            change causing a back and forth movement between alternatives with a                                 resulting inability to arrive at a stable preference           

            d. Techniques to attack complex decision problems judiciously:

                                    1. External Memory: supplement to working memory

                                                -what we keep in view we are likely to think about, “In                                                    sight, “in mind.”

                                                -written symbols allow us to have freedom from the                                                         limitations of what we know and have learned about the                                                               immediate situation, and allows us to consider what is not                                                 present - the past, the future, and the perspectives of                                                     others

                                                -the most important considerations in a decision process                                                             can easily be out of sight and out of mind

                                          a  Lists: using external memory through creating lists

                                                -lists of values, alternatives, future scenarios ensures that                                                             the good ideas are not forgotten

                                                -listing ideas encourages the production of new ideas                                                     -writing down old ideas frees controlled processes from                                                   reliance on habitual patterns, creates flexibility for new                                                            ideas

                                          b. Decision Tables and Decision Trees: external memory                                                                                                              devices

                                                -retain ideas that have already been generated and helps to                                                         organize them to guide further thought in logical directions

                                                -organize the lists of values, alternatives, and future                                                                     scenarios into a decision table, if uncertainties regarding                                                             the future scenarios are great a decision tree can be helpful

                                                -without decision tables and trees we fail to make crucial                                                            comparisons in reasoning about what we know, the                                                       tendency is to compare single alternatives against                                                                        intuition, rather than comparing multiple alternatives                                                              

                                                 against each other

                                                -this pattern of thought results in confirmation bias,                                                                      resulting in uncritical acceptance of poorly thought-out                                                   explanations

                                                -decision tables and trees force comparison of alternatives

                                          c. Removing Clutter From External Memory:

                                                -separating problem-relevant material from problem-                                                      irrelevant material

                                                -”dazzle-effect:” irrelevant information in the external                                                                                 memory demands attention, taking the                                                                                       attention away from the important task

                                                * “An organized work space reduces distraction and helps                                                           focus attention on the task.” (p.56)

                                    2. Priming: getting ideas ready to be thought out more easily

                                                -intermediate-term memory makes information more                                                       accessible to the working memory than it would be if                                                      accessed from long-term memory

                                                -Stimulus Control:

                                                            i. To get new ideas vary the automatic processes                                                                           through varying the stimuli

                                                            ii. To retain good ideas, reactivate the automatic                                                                            process by repeating stimuli in the form of                                                                      external memory aids

                                                            iii. To make potential good ideas more available to                                                                         thought, prime automatic processes by thinking                                                                          about them or associated ideas

                                                            iv. To get rid of distracting ideas, avoid activating                                                                            irrelevant automatic processes by removing                                                                   irrelevant stimuli

                                    3. Heuristic Search: mechanisms for efficient search                                                                   -an educated guess that helps to find solutions

                                                -central theme: constraint location, locating those aspects                                                                                    of the problem that restrict further search to                                                                   regions of the problem space where good                                                                                      ideas can be found

                                                -with complex problems, think efficiently by distinguishing                                               the important from the unimportant and direct attention to                                                     the essential








                                                -Types of Heuristic Searches:

                                                            i. Breadth-first search: importance of relevance                                                                          criterion for a well-structured value set,                                                                                     classes of alternatives, beginning at the                                                                              bottom of the Decision Ladder

                                                            ii. Value-focused search: analysis of values in                                                                             creative thinking about alternatives

                                                            iii. Sub-goal analysis: efficient thinking about                                                                              values

                                                -To think efficiently about your decision problem:

                                                            i. have a “rough sketch” before getting bogged                                                                  down in detail

                                                            ii. start the “rough sketch” by thinking about your                                                                          goals or sub-goals

                                    4. Decomposition: analysis of a problem into its components

                                                -the problem is broken down into sub-problems, the sub-                                                          problems are solved and the solutions are pieced together                                                          to solve the original problem

                                                -enables us to think about a small number of ideas at a                                                    time, yet arrive at a conclusion that is based on a large                                                    number of ideas

                                                -allows us to get a complex problem within our mental                                                    grasp

                                                -reduces interpersonal and intrapersonal conflict

                                                -Encourage judicious thought in decision making:

                                                            i. Use external memory.

                                                            ii. Remove problem-irrelevant clutter from external                                                                       memory.

                                                            iii. Think heuristically.

                                                            iv. Use a decision table to structure external                                                                                   memory in terms of simpler sub-problems.