Think Twice: Harnessing the Power of Counterintuition
Leaders in all fields-business, medicine, law, government-make crucial decisions every day. The harsh truth is that they mismanage many of those choices, even though they have the right intentions. These blunders take a huge toll on leaders, their organizations, and the people they serve.
Why is it so hard to make sound decisions? We fall victim to simplified mental routines that prevent us from coping with the complex realities inherent in important judgment calls. Yet these cognitive errors are preventable. In Think Twice, Michael Mauboussin shows you how to recognize-and avoid-common mental missteps, including:
-Misunderstanding cause-and-effect linkages
-Aggregating micro-level behavior to predict macro-level behavior
-Not considering enough alternative possibilities in making a decision
-Relying too much on experts
Sharing vivid stories from business and beyond, Mauboussin offers powerful rules for avoiding each error. And he explains how to know when it's time to think twice-to question your reasoning and adopt decision-making strategies that are far more effective, even if they seem counterintuitive.
Master the art of thinking twice, and you'll start spotting dangerous mental errors-in your own decisions and in those of others. Equipped with this awareness, you'll soon begin making sounder judgment calls that benefit (rather than hurt) your organization.
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by Michael MauboussinHardcover: 204 pages
Publisher: Harvard Business School Press (October 12, 2009)
Making a decision is difficult. For business leaders and investors making a correct one is even more difficult.
In his latest book, Think Twice: Harnessing the power of Counterintuition, Michael Mauboussin reviews 8 common behavioral decision mistakes. He notes there are three elements to the outcome of every decision: your
1. Thought process,
Difficult decisions involve an element of uncertainty; outcomes can only be expressed as probabilities. More often these decisions require action before complete information can be assembled. Using a combination of science, psychology and case studies, Mauboussin discusses the consequences of:
1. Inside; Outside Thinking
2. Tunnel Vision
3. Uncritical Reliance on Experts
5. The Pitfalls of Understanding Complex Systems on the Wrong Level
6. Predicting Cause and Effect
7. Small Perturbations during Phase Transitions
8. Skill and Luck
The author admits his book contains little that is new. I would posit, however, that one cannot consider and think about these concepts enough. After all, as the author points out, the most important letters in his title are T-H-I-N_ __ I-C-E. That observation alone underscores his book?s value.
Mauboussin?s strength is his ability to weave complexities into a provocative and easily read essay. The combination results in a book that should reside on every investor?s desk.
Craig L. Howe