The Key to Better Decision-Making

Posted by on Nov 20, 2017

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Social and behavioral scientists want to know what makes leaders successful. In “Grounded,” Bob Rosen’s research clearly reveals that personal mastery, self-awareness and openness to feedback are healthy roots embedded in successful leaders. Everyone has the capacity for personal mastery because it is a function of attitude, not DNA.

So how can you develop the right attitude?

Nudging Yourself to Personal Mastery

Turns out, having a nudge in your life or getting nudges from others will help you build personal mastery and self-awareness. We need nudges (and feedback) from others because we humans suffer from the Lake Wobegon effect (made famous by Garrison Keillor’s NPR show, Prairie Home Companion):

That’s the news from Lake Wobegon, where all the women are strong, all the men are good-looking, and all the children are above average.

According to behavioral economists, humans indeed have the tendency to overestimate achievements and capabilities. We tend to be overconfident in our decision-making; we tend to hold on to past beliefs long after proven otherwise; we tend to use wishful thinking in our decision-making. These behaviors lead us to do things like buy stock at peak prices, to not participate in employer matched retirement plans (401ks), etc.

The antidote to the Lake Wobegon effect, according to Richard Thaler and Cass Sunstein in their book, “Nudge,” is adopting a better decision-making model — by establishing a choice architecture which nudges us to do the right thing. For example, the opt-in versus opt-out choice. The New York Times ran a recent story, “Britain’s Ministry of Nudges,” reporting on the success the government has experienced with nudging.

Behavior economists posit that people do not always act in their own self-interest. When faced with choices (and we are barraged with choices daily), we are more likely to go with a default option. The primary idea of nudge in everyday decision-making is to help people change bad habits and acquire good habits.

Practical Nudges

Smartphone apps stand out as the best examples of a technology nudge. Whenever you use notification badges, sounds or banners you are essentially nudging yourself. Are you using those nudges strategically to improve your personal mastery? One that comes to mind for physical health is an app called iDrated. It nudges you to keep yourself properly hydrated.

What nudges have you set in place for yourself to build personal mastery? to be a healthier leader? Do you have people in your life who nudge you towards personal mastery? Send us your ideas (in comments below) and we’ll share them with the Healthy Leader Community.

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