Knowing when to shift back to a more intuitive decisional mode
It’s an accepted fact: to make a quality decision, it is best to collect as much information as possible and analyze it with care. But is that always true?
Many research studies invite us to nuance this conviction. They show that, in certain contexts, it is beneficial to avoid an in-depth analysis of the situation. In such cases, it is best to content ourselves with deciding on the basis of simple criteria, such as empirical rules founded on past experiences. This can be observed in three situations:
- An uncertain context, saturated in information: when multiple data and analyses are available and the state of the art doesn’t allow a solid decisional basis, adding still more information and analyses only increases the cognitive load, without further clarifying the decision to be made.
- A fluctuating environment: in fast-evolving markets, data is sometimes obsolete before it has even had the time to be collected and processed.
- Difficulties accessing information: sometimes, the necessary cost of collecting information in the needed quantity and quality isn’t justified by the potential benefits associated with a better-informed decision.
In such circumstances, the quality of the decisions taken depends less on the finesse and exhaustiveness of the analyses than on the ability to mobilize our experience or that of our experts. A counter-intuitive discovery in the age of Big Data!
Source: The Potency of Shortcuts in Decision-Making, Sebastian Kruse, David Bendig, Malte Brettel, MIT Sloan Management Review, September 2023.
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