The document discusses decision making and why 45% of decisions are wrong. It outlines various steps, stages, and factors to consider in the decision making process. These include defining the problem, analyzing causes, considering possible solutions, assigning responsibilities, evaluating results, and testing outcomes. It also discusses cognitive biases and heuristics that can lead to irrational decisions, such as overconfidence in intuition, the illusion of understanding, and substituting easier questions for difficult ones. The document emphasizes reflecting on past decisions and their consequences to make improved choices going forward.

1. 1
“45 % of all our decisions
are wrong”
WHY?
Roger Claessens, Prof. UBI
www.rogerclaessens.be

2. 2
Could your
neighbour introduce
YOU?

3. Why than such a high
%?
3

4. 4
You may
remember the…

5. 5 Steps
1. Define
2. Measure
3. Analyse
4. Innovate or
Improve
5. Control
DMAIC

6. 6
7 Stages
1 Define
2 Causes of problem
3 Possible solutions
4 Decide
5 Responsibilities
6 Evaluate results
7 Test

7. 7
3 R’s
Reflect
Respond
Revise

8. 8
Maths
  
im i m
im 
2
m
 

9. 9
We have TOOLS,
don’t we?

10. THE COMPLEXITY
OF DECISION
MAKING

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13. MARGIN
CALL
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15. • You are in the Arizona desert in the hottest time of
the year. You know that you are about 125 km from
the nearest town. Fortunately you have some pieces
of equipment and items left that you could use for
your survival.
• The decision to make is: either to stay put and wait
for help or move and walk the 75 miles to the
nearest town. Whatever the decision it needs to be
taken unanimously!
15

16. • Compass
• Small transistor radio
• Shaving mirror
• Snake repellent
• 1,5-liter of water per person
• 4 square meter of plastic
• Mosquito netting
• 1 case of rations
• Maps of the desert
16
• Cushions
• 5 litre of an
oil/gas mixture
• 1 bottle of rum
• Two boxes of
chocolate
• 5 meter of ropes
• One boomerang

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18. Decision making
18

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Intuition is the ability to acquire
knowledge without inference or the
use of reason

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21. Decision Making
Intuition =Recognition
We are often wrong, and an objective observer
is more likely to detect our errors than we are
21

22. Decision Making
• System 1 operates automatically and quickly
with little or no effort and no sense of voluntary
control. It includes the innate skills that we share
with other animals.
22

23. • System 2 allocates attention to the effortful
mental activities that demand it, including complex
computations. It requires attention and effort.
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Decision Making

24. Decision Making
Overestimation of intuition and underestimation of
what we need for the analytical part of the decision
making process will induce:
IRRATIONAL
PERSEVERANCE
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25. Decision Making
When people believe a conclusion is true,
they are also very likely to believe
the arguments that appear to support it,
even when these arguments are unsound.
25

26. Decision Making
High intelligence does not make people immune to
biases!
26

27. Decision Making
The illusion that one has understood the
past feeds the further illusion that one can
predict and control the future.
27

28. Decision Making
• It is natural for System 1 to generate
overconfident judgements, because
confidence is determined by the coherence of the
best story you can tell from the evidence at hand.
• Therefore your intuitions will deliver predictions that
are too extreme and you will be inclined to put far
too much faith in them.
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29. Decision Making
Expertise depends essentially on the quality and
speed of feedback, as well as on sufficient opportunity
to practice.
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30. Decision Making
• When faced with a difficult question, we often
answer an easier one instead, usually without
noticing the Substitution
• There are several ways human choices deviate from
the rules of Rationality
30

31. We have the illusion of making decisions!
MIT _ TED Talks
31

32. SO,
WHAT DO WE DO?
32

33. Think Different
Kick start your brain.
New ideas come from
watching something,
talking to people,
experimenting, asking
questions, getting out
of the office
- Steve Jobs
http://steve-jobs-biography.pics-grabber.appspot.com/
Steve Wheeler, University of Plymouth, 2011

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38. WHAT MOTIVATES YOU? 38

39. •DO YOU FEEL YOU THINK
EFFECTIVELY? 39

40. •DO YOU KNOW WHAT YOU NEED
TO KNOW?
40

41. This is the result of a
way of thinking:
Better
Faster
Cheaper
Smaller
Simpler
Smarter
41

42. CONSEQUENCES!
42

43. • What were the
CONSEQUENCES of the
wrong decisions?
• What would have been
CORRECT decisions?
43
Discussion

44. GSM MERCHANT BANK
44

45. CAR DEALERSHIP
45

46. The 20 steps for good DECISIONS
Examine every
alternative
Use previous
decisions if
the are still
applicable
Make long
term
decisions with
the short term
in mind
Change
decisions that
are no longer
appropriate
Consider the
implications
of each
decision
46

47. The 20 steps for good DECISIONS
Try to foresee
and prepare
for any
changes
Always ask
what can go
wrong with
your decision
Always
consider the
possible
outcomes
Always try to
balance
intuition and
logic
Avoid making
decision that
have a large
element of
chance in
them
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48. The 20 steps for good DECISIONS
Follow a
precedent
when it
works
Challenge
the
company
culture if
need be
Be aware of
politics
behind
decisions
Weigh the
impact of
decisions
on people
Do not be
afraid to
delegate
the process
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49. The 20 steps for good DECISIONS
49
Do not be
afraid of
rejection,
think about
an alternative
Build your
trust in
decision
making
Never make
decisions
under
pressure
If it proves to
be a wrong
decision, take
fast action
Never
postpone vital
decisions –
make them
quickly

50. Decisions…, don’t
forget the
MYTHS
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51. 51
WHAT YOU WILL BE ABLE TO DO AFTER A
GOOD DECISION

52. contact@rogerclaessens.be

53. « Thinking, fast and slow, Daniel Kahneman,; Penguin Books, 2011
« Blink » Malcolm Gladwell, Back Bay Books, 2005
« Inside Steve’s Brain », Leander Kahney, Atlantic Books, 2008
« The black swan », N.Taleb, Pinguin 2007
« Organisational culture and leadership », Edgar H, Schein, Jossey-
Bass, 2010
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