Eight to Late

Sensemaking and Analytics for Organizations

Why deliberation trumps standard decision-making methods

with 10 comments

Wikipedia defines decision analysis as the discipline comprising the philosophy, theory, methodology, and professional practice necessary to address important decisions in a formal manner.  Standard decision-making techniques generally involve the following steps:

  1. Identify available options.
  2. Develop criteria for rating options.
  3. Rate options according to criteria developed.
  4. Select the top-ranked option.

This sounds great in theory, but as Tim van Gelder points out in an article entitled the The Wise Delinquency of Decision Makers, formal methods of decision analysis are not used as often as textbooks and decision-theorists would have us believe.  This, he argues, isn’t due to ignorance:  even those trained in such methods often do not use them for decisions that really matter. Instead they resort to deliberation –    weighing up options in light of the arguments and evidence for and against them. He discusses why this is so, and also points out some problems with deliberative methods and what can be done do fix them. This post is a summary of the main points he makes in the article.

To begin with, formal methods aren’t suited to many decision-making problems encountered in the real world. For instance:

  1. Real-world options often cannot be quantified or rated in a meaningful way. Many of life’s dilemmas fall into this category. For example, a decision to accept or decline a job offer is rarely made on the basis of material gain alone.
  2. Even where ratings are possible, they can be highly subjective. For example, when considering a job offer, one candidate may give more importance to financial matters whereas another might consider lifestyle-related matters (flexi-hours, commuting distance etc.) to be paramount. Another complication here is that there may not be enough information to settle the matter conclusively. As an example, investment decisions are often made on the basis of quantitative information that is based on questionable assumptions.
  3. Finally, the problem may be wicked – i.e. complex, multi-faceted and difficult to analyse using formal decision making methods. Classic examples of wicked problems are climate change (so much so, that some say it is not even a problem) and city / town planning. Such problems cannot be forced into formal decision analysis frameworks in any meaningful way.

Rather than rating options and assigning scores, deliberation involves making arguments for and against each option and weighing them up in some consistent (but qualitative) way. In contrast to textbook methods of decision analysis, this is essentially an informal process; there is no prescribed method that one must follow. One could work through an arguments oneself or in conversation with others.  Because of the points listed above, deliberation is often better suited to deal with many of the decisions we are confronted with in our work and personal lives (see this post for a real-life example of deliberative decision making)

However, as Van Gelder points out,

The trouble is that deliberative decision making is still a very problematic business. Decisions go wrong all the time. Textbook decision methods were developed, in part, because it was widely recognized that our default or habitual decision making methods are very unreliable.

He  lists four problems with deliberative methods:

  1. Biases – Many poor decisions can be traced back to cognitive biaseserrors of judgement based on misperceptions of situations, data or evidence. A common example of such a bias is overconfidence in one’s own judgement. See this post for a discussion of how failures of high-profile projects may have been due to cognitive biases.
  2. Emotions – It is difficult, if not impossible, to be completely rational when making a decision – even a simple one.  However, emotions can cloud judgement and lead to decisions being made on the basis of pride, anger or envy rather than a clear-headed consideration of known options and their pros and cons.
  3. Tyranny of the group – Important decisions are often made by committees. Such decisions are subjected to collective biases such as groupthink – the tendency of group members to think alike and ignore external inputs so as to avoid internal conflicts. See this post for a discussion of groupthink in project environments. 
  4. Lack of training – People end up making poor decisions because they lack knowledge of informal logic and argumentation, skills that can be taught and then honed through practice.

Improvements in our ability to deliberate matters can be brought about by addressing the above. Clearly, it is difficult to be completely objective when confronted with tough decisions just as it is impossible to rid ourselves of our (individual and collective) biases.  That said, any technique that lays out all the options and arguments for and against them in a easy-to-understand way may help in making our biases and emotions (and those of others) obvious. Visual notations such as  IBIS (Issue-Based Information Systems) and  Argument Mapping do just that.  See this post for more on why it is better to represent reasoning visually than in prose.

The use of techniques such as the ones listed in the previous paragraph can lead to immediate improvements in corporate decision making. Firstly,  because gaps in logic and weaknesses in supporting evidence are made obvious, those responsible for formulating, say, a business case can focus on improving the their arguments prior to presenting them to senior managers. Secondly, decision makers can see the logic, supporting materials and the connections between them at a glance. In short: those formulating an argument and those making decisions based on it can focus on the essential points of the matter without having to wade through reams of documentation or tedious presentations.

To summarise: formal decision-making techniques are unsuited to complex problems  or those that have  options that cannot be quantified in a meaningful way. For such issues, deliberation –  supplemented by visual notations such as IBIS or Argument Mapping – offers a better alternative.

Written by K

May 13, 2011 at 5:32 am

10 Responses

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  1. Normally I find the posts here to be very measured and interesting. However, this time I think that what has been presented is a simplistic representation of formal decision making techniques. “Ratings” for example have been contrasted with qualitative deliberation as if the options are in some kind of exclusive binary relationship. The reality is much more complex than this.

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    Rob Hall

    May 13, 2011 at 6:29 am

  2. Rob,

    Thanks for your comment.

    You’re right – ratings and qualitative arguments are not mutually exclusive, decision-makers often use both. Although I have written “…where ratings are possible, they can be highly subjective…” , perhaps I should have made it clearer that they are not always so. Indeed Tim makes the point that standard techniques are useful in many situations. That said, as I have discussed in a post on the limitations of scoring methods in risk analysis, ratings (both qualitative and quantitative) are often misused. In such situations, deliberation may be a better option.

    Regards,

    Kailash.

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    K

    May 13, 2011 at 7:12 am

  3. Ben Franklin described his decision making process in the 18th century. It remains remarkably robust.

    http://blog.smartdraw.com/cfs-file.ashx/__key/CommunityServer.Blogs.Components.WeblogFiles/smartdraw_5F00_weblog.posts.entries.2009.August.Ben+Franklin/Ben-Franklin-Letter-to-Priestley.pdf
    In summary
    1. Frame the Decision

    2. make two side by side lists of the Pros and Cons

    3. Assess the Importance of the Pros and the Cons
    Strike out pros and cons that balance. Next strike two from one column that balance one from the other.

    At this point, one column is often surprisingly longer than the other. If not, you have a more difficult decision, fortunately, close decisions often (though not always) matter the least because they have similar expectation value.

    Seems like a systematic deliberation.

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    Bill Nichols

    May 13, 2011 at 7:25 am

  4. Bill,

    Absolutely: Franklin’s is the archetypal method of assessing options via deliberation. However, it has its limitations. For one, it is applicable to yes/no type decisions, but real life problems often involve more than two options. Tim van Gelder has written an excellent post on deliberation on his blog. Among other things, he discusses Franklin’s method and its limitations.

    Regards,

    K.

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    K

    May 13, 2011 at 7:19 pm

  5. Ratings?
    To expose the limitation of attempting to apply ratings to decision logic, all I have to do is ask “What do you mean by ratings?”

    In most cases where ratings are used, whether verbal or numeric, they are so open to such a range of interpretation at the semantic level that they are almost meaningless for communication, in my view.

    One person says something has a ‘high’ risk, for example; another, with a different understanding of the project, with different objectives and hopes, a different internal scale, a different approach to language and a different tolerance for risk, calls the same risk ‘moderate’. So where does that leave us? Nowhere useful, I think.

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    David

    May 23, 2011 at 4:17 pm

  6. David,

    Thanks for your comment. Although I did understate this point in the article, my thoughts about ratings are pretty much the same as yours.

    Regards,

    Kailash.

    Like

    K

    May 23, 2011 at 11:08 pm

  7. […] on a mix of informal reasoning, personal beliefs and even leaps of faith. As I have pointed out in this post, there are good reasons for this. Quoting from the post, formal (or rational) processes often […]

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  8. […] “doing it correctly,” but this is a simplistic view for reasons I have discussed at length in this post.  So, despite all the so-called “advances” in decision making, it is still pretty much  as […]

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  9. […] other than data and are generally made in situations that are ambiguous.  Typically people use deliberative methods – i.e. methods based on argumentation – to arrive at decisions on such matters.  The sad […]

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  10. […] I have pointed out in this post, the above process is too simplistic for some of the complex, multifaceted decisions that we […]

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