TOOLS FOR MAKING DIFFICULT DECISIONS

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Managers in the gaming industry are often forced to make difficult business decisions. Decision makers can benefit from having a set of tools to ensure their decisions are as correct as possible, given the amount of information available at the time. Leading academics in behavioral finance and the science of decision making, such as Daniel Kahneman, Richard Thaler, and Philip Tetlock, have spent decades researching how to systematically improve decision making, and their findings can be utilized by intentionally completing a few mental exercises when faced with a difficult decision. These professors have shown that deliberately completing the following set of exercises leads to dramatically better decision results in the long term by overcoming many innate tendencies that introduce bias in our decision making.

What makes a decision difficult? Usually, the difficulty arises because the outcome is especially important, and there is uncertainty in the consequences of the available choices. High stakes consequences require confidence that a choice leads to the expected result. The following collection of mental exercises can dramatically improve decision making results by systematically identifying and addressing uncertainty, as well as helping identify and remove the human biases we may not recognize are influencing our decision. My recommendation to anyone facing a big decision is to work through each of the following mental exercises before making the decision. Afterwards, review the insights you’ve gained and carefully note what is known for certain and what is estimated before making the choice. It might seem tedious and time consuming, but if the decision is important enough then the additional insights gained will be worth the effort.

READ THE FULL ARTICLE BY THOMAS KIRSCHENMANN IN THE 2021 WINTER EDITION OF GAMING & LEISURE MAGAZINE.

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