5 Reasons Smart People Make Dumb Decisions
I’ve made my fair share of bad decisions in life: dropping out of college at the end of my sophomore year to get married and have kids, staying too long in a dead-end relationship, leaving ‘a real job’ to become a legal intern when I had three kids to support. Some of my bad decisions worked out, and some of them didn’t.
Why do we make bad decisions? It’s a question I’ve pondered – and I suspect if we understand the circumstances that lead to poor decision making, we can avoid making some mistakes in the future.
Let’s take a look at five reasons why people make mistakes:
- Information anxiety. Have you ever been overwhelmed by the sheer amount of information coming at you and just shut down? The average CEO gets approximately 500 emails a day. Some of these emails are important, and others are junk. Unfortunately, emails are rarely labeled ‘junk’ or ‘very important.’ When people become overwhelmed by a large amount of information that is poorly organized, they stop updating their information to meet the current situation. They can’t process all of the information they see. And beliefs that are out of date to our current situation tend to lead to bad decisions.
- Not enough information. Think about a big decision you had to make – gathering all the details about your options can be exhausting! It’s no surprise that we can get impatient and stop gathering the information needed to make the best decision. Instead, we take the limited information we have gathered and decide. Often, it’s a mistake.
- Unreliable sources. Even if you don’t get impatient, and you’re dedicated to gathering information, not all sources are created equal. Whether it’s data or people, both can be unreliable. It’s like consuming a diet of information fast food. I refer to this as infobesity. Poor quality information leads to poor decisions.
- Invincible mentality. How often have we seen smart people exaggerate the probability of success and understate the probability of failure? I had a colleague in law school who was near the top of her class – she was a semester ahead of me and took the bar exam before I did. I was shocked to see her in my bar exam prep course the following January. How did SHE fail the bar exam? I discovered she felt confident as a result of being among the top in her class and had relaxed when it came to exam prep. By the time she figured out that she had been overconfident and was underprepared, it was too late.
- Decisions always come with emotions, but they shouldn’t be made solely based on emotions. I believe that right actions lead to right feelings – and that right thinking leads to right actions. It’s very difficult to make a good decision when you are in a bad emotional place.
Can you see yourself in any of these reasons? The next time you have a decision to make – no matter how big or small – revisit this list to make sure you aren’t falling into any of these categories. If you are, then recognize it and reengage your strategy for decision making – it could make a big difference in your future.