Being Wrong - How Do We Make Decisions

How do we make decision? What differentiates a good decision and a bad one?

How do we make choices? What differentiates a good choice and a bad one?

We all do it, our daily lives are in a constant state of decision-making. In order to make a good decision, you first need to know all the facts, and then make a “rational” decision. The problem with that approach is that we are human, we are a lot of things. Rational is probably not one of them.

We usually use our subconscious to trick our brain into making decisions that we later realize are absolutely wrong. Humans are irrational in the way they perceive and save information, which can sometimes make it harder to make rational decisions.

So how can we make the right decision all the time?

As the founder of a startup, I hear a lot of talk about what an entrepreneur should be, and the skills and characteristics we all must have in order to be successful. An entrepreneur should have a clear vision of the future and be a hard worker who is willing to dedicate everything they have without any guarantee of success. The most key part of the entrepreneurial arsenal is resilience, because things are going to get worse before they get better.

One of the most important things every entrepreneur needs to have is the understanding that there are no guarantees in this business, even if you bust your ass. When failure happens (and it will, at one point or another) entrepreneurs must have the strength to come back and win.

Back when I first started my own company, I had the mindset that failing was not an option. Two years later I realized I was right, Failure is not an option, it’s a fact.

Failing is cold, hard fact. You will fail, but don’t fight it. Embrace it.

Your Failures Defines You

Your failures defines who you are. It defines who you are as a person and it defines you as an entrepreneur.

My failures define me. It’s been a two-year journey since I started my first company, and the thing that most strikes me is that I always thought my next move would be the right one.

Isn’t that what they mean when they say an entrepreneur should have a clear vision of what the future will look like? Our decisions, both bad and good, will shape our future. This is the reason why decision making is not something you were born with, it’s a skill you gain along the way. The more bumpy the path, the more your decision making process improves.

We all learn from the mistakes we made in the past, but the past is the past, and entrepreneurship is about the future. This is exactly why I decided I want to learn from my own mistakes, before they even happen.

“There are two sides to every issue: one side is right and the other is wrong, but the middle is always evil. ” ― Ayn Rand

The thing about always thinking that your next move might be wrong, is that it allows you to create an alternative plan and really think through all the possible scenarios in making your next decision. Being able to predict potential failure is an invaluable skill that all of us can benefit from. By always thinking that you’re possibly wrong, you position yourself to be in a win-win situation. If you’re right (and your next move is indeed wrong), you can always go for the backup plan, iterate fast and win. In case you’re wrong, it actually means that your next move was the right one.

When facing a decision making moment, our brains analyze the facts and information using pattern recognition. The way we react to that information relies on emotional tags that are stored in our memory, but there are a few techniques to help make a better decision, such as opportunity costs, elimination by aspects, and even flipping a coin.

You will always face at least two different scenarios in every decision you make (if there’s only one scenario, you’ve already made the decision).

Since we started Swayy, I learned that what helps me make better decisions and efficiently manage risk, is to always look for a solution to at least two opposite scenarios.

Someone once told me that we can’t be always right because then we wouldn’t have a way to appreciate a moment of success. Now, I agree. As stupid as it sounds, sometimes making a bad decision and being wrong is an important lesson in life.

All you need to do in order to make good decisions, is to have one thing in mind – prepare yourself to be wrong, get up again, and win.

I would love to hear your thoughts and experiences on how to improve the decision making process. Also, if you are thinking about sharing this article, trust me, it’s the right decision.

Cheers,

Ohad