Outsmart your own biases

Article from Harvard Business Review by Jack b. Soll, Katherine L. Milkman, and John W. Payne

Some pointers that I've got are:
1. Thinking about the future
2. Thinking about objectives
3. Thinking about options
4. Fighting motivated bias

On Thinking about the future

• Nearly everyone thinks too narrowly about possible outcomes. Some people make one best guess and stop there. Others at least try to hedge their bets (using percentage/ likelihood). Because most of us tend to be highly overconfident in our estimates, it's important to "nudge" ourselves to allow for risk and uncertainty. 
• Make three estimates. To improve your accuracy, work up at least three estimates - low, medium, and high - instead of just stating a range. People give wider ranges when they think about their low and high estimates separately, and coming up with three numbers prompts you to do that. Your low and high guesses should be unlikely but still within the realm of possibility. Chances are, your middle estimate will bring you closer to reality than a two number range would. 
• Think twice. A related exercise is to make two forecasts and take the average. Research shows that when people think more than once about a problem, they often come at it with a different perspective, adding valuable information. So tap your own inner crowd and allow time for reconsideration: Project an outcome, take a break (sleep on it if you can), and then come back and project another. Don't refer to your previous estimate - you'll only anchor yourself and limit your ability to achieve new insights. If you can't avoid thinking about your previous estimate, then assume it was wrong and consider reasons that support a different guess.
• Use premortems. In a postmortem, the task is typically to understand the cause of a past failure. In a premortem, you imagine a future failure and then explain the cause. This technique, also called prospective hindsight, helps you identify potential problems that ordinary foresight won't bring to mind. Thinking in this way has several benefits. First, it tempers optimism, encouraging a more realistic assessment of risk. Second, it helps you prepare backup plans and exit strategies. Third, it can highlight factors that will influence success or failure, which may increase your ability to control the results. 
• Take an outside view. This is where you consider what's happened with similar ventures and what advice you'd give someone else if you weren't involved in it. It prevents the "planning fallacy" - spinning a narrative of total success and managing for that, even though your odds of failure are actually pretty high.

On Thinking about objectives

• It's important to have an expansive mindset about your objectives, too. This will help you focus when it's time to pick your most suitable options. Most people unwittingly limit themselves by allowing only a subset of worthy goals to guide them, simply because they're unaware of the full range of possibilities. Early in the decision-making process, you want to generate many objectives. Later you can sort out which ones matter most.
• Seek advice. Round our your perspective by looking to others for ideas. Outline objectives on your own before seeking advice so that you don't get "anchored" by what others say. And don't anchor your advisers by leading with what you already believe. If you are making a decision jointly with others, have people list their goals independently and then combine the lists. 
• Cycle through your objective. Looking at objectives one by one rather than all at once helps people come up with more alternatives. Seeking a solution that checks off every single box is too difficult - it paralyzes the decision maker. 

On thinking about options

• Although you need a critical mass of options to make sound decisions, you also need to find strong contenders - at least two but ideally three to five. Unfortunately, people rarely consider more than one at a time Managers tend to frame decisions as yes-or-no questions instead of generating alternatives. Yes-no framing is just one way we narrow our options. Others include focusing on one type of solution to a problem (what psychologists call functional fixedness) and being constrained by our assumptions about what works and what doesn't. All these are signs of cognitive rigidity, which gets amplified when we feel threatened by time pressure, negative emotions, exhaustion, and other stressors. We devote mental energy to figuring out how to avoid a loss rather than developing new possibilities to explore.
• Use joint evaluation. The problem with evaluating options in isolation is that you can't ensure the best outcomes. A proven way to snap into joint evaluation mode is to consider what you'll be missing if you make a certain choice. 
• Try the "vanishing options" test. Once people have a solid option, they usually want to move on, so they fail to explore alternatives that may be superior. To address this problem, the decision experts Chip Heath and Dan Heath recommend a mental trick" Assume you can't choose any of the options you're weighing and ask, "What else could I do?". This question will trigger an exploration of alternatives. 

On Fighting motivated bias

• All these cognitive biases - narrow thinking about the future, about objectives, and about options - are said to be "motivated" when driven by an intense psychological need, such as a strong emotional attachment or investment. 
• Motivated biases are especially difficult to overcome. You know this if you've ever poured countless hours and resources into developing an idea, only to discover months later that someone has beaten you to it You should move on, but your desire to avoid a loss is so great that it distorts your perception of benefits and risks. And so you feel an overwhelming urge to forge ahead - to prove that your idea is somehow bigger or better. 
• Our misguided faith in our own judgement makes matters worse. We're overconfident for two reasons: We give the information we do have too much weight. And because we don't know what we can't see, we have trouble imagining other ways of framing the problem or working towards a solution. 
• But we can preempt some motivated biases, such as the tendency to doggedly pursue a course of action we desperately want to take, by using a "trip wire" to redirect ourselves to a more logical path. In business, trip wires can make people less vulnerable to "present bias" - the tendency to focus on immediate preferences and ignore long term aims and consequences. 

Yours,
Something Small Thinking Big