Improve humanity by making better decisions

The start of the current millennium feels a long time ago to many of us. Although the Millennium project might sound like an initiative that has lost its purpose, in 2018 it is more relevant than ever!

The Millennium project, hosted by the United Nations, aims “to improve humanity's prospects for building a better future”. The 200 scholars involved created a list global challenges that we, as mankind, are faced with.

Climate change, clean water and population growth are the topics that, maybe predictable, top the list. However, what ranks on the fifth spot, above “outbreak of diseases” and “weapons of mass destruction”, might come as a surprise: Decision making.

In a world of unprecedented accelerating change there is an eminent need to improve our decision making capability. Effective decision making of our leaders is paramount to be able to address current global challenges.

For the past two decades I have been working with a large number of pharmaceutical- and the energy companies, and upon reflection, there is no getting away from it; poor decision making practices are endemic. This is not just my perception. Independent Project Analysis (IPA) analysed the failure of a large number of projects across industries. IPA concludes that poor decision making is a key reason for cost overruns, project delays and failure to realise revenue targets.

The reasons for poor decision making are numerous. One key problem is that people simply do not recognise that poor decision making is an issue. After all we make decisions every day, throughout each day. For example, choosing a coffee: black or white, one or two sugars, large or small? However, these are easy decisions: 1) there is little uncertainty, and 2) we receive immediate feedback on our choice. These are exactly same factors that make decision making in the development of drugs, or oil fields, so difficult.

Psychological research shows that intuitive decision making is severely compromised in situations with even a low degree of uncertainty. A more analytical approach, in which uncertainties are recognised and assessed, has proven to be a much more effective when facing complex decisions.

Given the extended project time lines, and the fact we drink many more cups of coffee than the number project we initiate the feedback obtained from past decisions is compromised. This lack of feedback exposes us to a series of judgmental biases.

Fortunately, over the past decades we have learned much about the problems around decision making and we have developed tools that mend many poor decision making practices.

As a decision analyst I speak to many of project teams about decision making and I am continued to be excited to learn about people’s commitment to improve decision making practices. Commitment is essential. Ronald Howard, the grandfather of decision sciences, once stated: “…improving decision making relies on the willingness to employ decision sciences...”.