Despite their potential, many Boards of Directors are significantly underutilized in the corporate decision-making process. Many Boards, particularly in private companies, are marginalized bodies consulted at the last minute as a formality to rubber stamp company management’s preferred course of business action. This often results in making suboptimal decisions and losing the opportunity to use […]
Decision-making is heavily affected by bias. Biases can cause us to overlook facts, reframe issues, and distort our perception of the world around us to fit what we are consciously or unconsciously trying to see. This can lead to many decisions that have negative impacts on companies. While it is not possible to be completely […]
In a world where many things do not work optimally, there is constant pressure to adopt new approaches. While innovation can create many positive benefits, the urge to innovate can overlook the often-great hidden value of things that already exist. Additionally, innovation-driven solution biases can lead to situations where the resources expended to find solutions […]
The goal of decision-making is to arrive at the best solution possible for an issue given the problem, available resources, and time constraints. While there are many ways to make choices, one powerful decision-making tool is lateral thinking. This involves a leap from a familiar decision-making mindset to a significantly different one. This article, part […]
Elon Musk has said that first principles reasoning is a powerful way to innovate. Rather than reasoning by reference to things that already exist, first principles thinking starts from fundamental truths and then reasons from there to question established beliefs and practices and find solutions. After discussing first principles reasoning, this article, part 5 of […]
Many mental frameworks and systems are used to make decisions. One of the most common is reasoning by analogy, where one object, process, or situation is compared to another. While analogical reasoning is essential to function in a world where we constantly face new facts and circumstances, it can also lead to many erroneous conclusions. […]
Humanity has struggled for thousands of years with a seemingly simple question: How can I decide wisely? This question has remained challenging throughout the ages because it is highly subjective, has many dimensions, and choices must be made in the face of limited information, time constraints, and uncertainty about the future. Many classical decision-making models, […]
The first decision-making step is determining whether a decision should be made at all. Many choices are made unnecessarily, which can cause a loss of decision-making resources, generate opportunity costs, and put a person or a company in a worse position than before the decision. Sometimes, postponing a decision will significantly expand decision-making options and […]
Making good decisions is highly challenging. Difficult choices with far-reaching implications often have to be made very quickly, with limited information, and in the face of disagreement about the best course of action. Complicating this further, decisions are not made in prejudice-free or value-free vacuums but are heavily affected by many cognitive, emotional, and organizational […]
The evaluation of leaders has historically been heavily biased toward results: the leaders of well-performing institutions are assumed to be good and the leaders of poorly performing institutions are assumed to be bad. But are results alone the best measure of leadership performance? On many occasions, leaders play little role in a company’s success and […]