Managing “Atmospherics” in Making Decisions

One offshoot of the fast-advancing research in neuroscience is the growing body of literature on decision-making. Hugely popular books like Malcolm Gladwell’s Blink and Daniel Kahneman’s Thinking Fast and Slow (which introduced us all to the distinction between Type 1 and Type 2 thinking) reveal how far actual decision-making varies from the logical decision-tree analyses and case study deliberations traditionally taught (and being taught less now).

Yet the truth of human decision-making is even less rational than the cognitive biases and limitations these works describe. Other important research shows the extent to which people deciding – even on matters of great consequence – are influenced by what we could call atmospherics.

For example, to cite just a few studies:

  • The type of music being played in the background of a liquor store affects purchases. When German music is played, more German wines are sold.
  • Adding the color red to a medical pamphlet (versus printing it in black-and-white) raises the likelihood of a patient’s opting to receive a recommended vaccination.
  • Showing investment opportunities in green instead of red makes a difference, too.
  • Informing an investor that a perspective comes from an “expert” causes them to “turn off” their independent consideration of evidence that contradicts that view.
  • “Priming” decision-makers to make associations that they would not otherwise make (such as by showing pictures or words that evoke images in advance) causes them to behave differently.

And of course, any marketing researcher knows the impact of the order of presentation and the curious effects that arise when test products are either labeled (“A” tends to win over “B”) or branded versus blind-tested. (Recall that “new Coke” won in blind-tasting, yet people shunned it when it became brand Coke.)

The overall message of such studies is clear. It’s not just that decision-makers don’t refer to data in making choices – they don’t even necessarily decide based on “gut feel.” Decisions are being made because of external and seemingly extraneous factors that work on a wholly unconscious level, bypassing even the gut.

In a sense this “new” discovery is not surprising in that businesses have long recognized that humans as consumers are susceptible to all sorts of urges and emotions which guide them toward decisions to buy things they don’t need or didn’t previously recognize they needed. Even “considered category” items such as cars are advertised with exciting sound effects and music, acknowledging the role of something other than rational thought in important purchase decisions.

Understanding why a given decision was made requires insight into EQ as much as into IQ. It requires an understanding of subjective emotions as much as of objective ROI and Bayesian models.

But despite what we know about decision-making by consumers, we’re slow to accept that humans as executives are subject to the same influences. Unfortunately, it’s true.

So, what can or should we do to improve decision-making? Can we really study it at all? Can we get better at it?

Let’s take the latter question first. Yes, we can get better at it, starting with acknowledging that irrational factors are always at play. To counter unconscious influences, such as the ones described above, we can apply scientific approaches like making sure to consider all alternatives under the same conditions, or rotating the order in which ideas are presented. For important decisions, we need to consciously anticipate possible biases and, if we cannot be objective, we need to enlist second and third opinions from trusted parties. We might force more rationality by considering what information would compel us to overcome our initial preference, and then do the research to find that information if it exists. Alternatively, we might simply go with that initial preference, especially if the real payoff is likely to be in the execution of the idea, anyway. We can make the rational decision not to waste additional time and money on gathering information we will never accept, but will have to pay for.

As for the question about studying decision-making, the task only becomes more interesting and important when we recognize decision-making as a complex and messy phenomenon. I’m reminded of a 2007 New Yorker article in which Malcolm Gladwell cites Gregory Treverton’s thinking. Treverton, a national security expert, observes that there are two kinds of problems in the world – puzzles (which have absolute answers although the solver has not yet discovered them) and mysteries (for which definitive answers don’t exist because they depend on dynamics among many, unknowable factors). Instead of treating decision-making as the former, we must accept that it is the latter. It requires, simply, seeing the process as art more than science. That doesn’t negate the value of research about it, but it means that we have to accept that there will be a mysterious imprecision in how we make and evaluate decisions.

High Stakes Decision Making An HBR Insight Center
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