Annie Duke Quotes

For reasons that are going to become clear, a good decision tool seeks to reduce the role of cognitive bias (such as overconfidence, hindsight bias, or confirmation bias) and a pros and cons list tends to amplify the role of bias.

When the outcome turns out poorly, it's easy to focus on the details that suggest the decision process was poor. We think we are seeing the decision quality rationally because the bad process is obvious.

A higher chance of failing is more tolerated on paths that don't rock the boat. After all, what's the go-to defense in a postmortem after we make a decision that doesn't work out? "I followed procedure," or "I stuck with the status quo," or "I made the consensus choice."

A necessary part of becoming a better decision-maker is learning from experience. Experience contains the lessons for improving future decisions. Resulting causes you to learn the wrong lessons.

The next time that you find yourself saying, "I'm just not ready to decide yet," what you should actually say is "For now I think that the status quo is still the best choice." Maybe you need more information to know whether to switch. But what shouldn't stop you from quitting (or getting that information) is that it's too scary to switch because loss aversion is too intense.

SIX STEPS TO BETTER DECISION-MAKING Step 1 — Identify the reasonable set of possible outcomes. Step 2 — Identify your preference using the payoff for each outcome — to what degree do you like or dislike each outcome, given your values? Step 3 — Estimate the likelihood of each outcome unfolding. Step 4 — Assess the relative likelihood of outcomes you like and dislike for the option under consideration. Step 5 — Repeat Steps 1–4 for other options under consideration. Step 6 — Compare the options to one another.

When people result, they look at whether the result was good or bad to figure out if the decision was good or bad.

That's the funny thing about grit. While grit can get you to stick to hard things that are worthwhile, grit can also get you to stick to hard things that are no longer worthwhile. The trick is in figuring out the difference.

Making better decisions starts with understanding this: uncertainty can work a lot of mischief.

Staw's central insight about escalation of commitment is that the phenomenon is not confined to matters like the Vietnam War, a complex geopolitical conflict with national pride wrapped up in it. His laboratory and field experiments show that whether it is on the level of an individual, an organization, or a governmental entity, when we're getting bad news, when we are getting strong signals that we're losing — signals that others plainly see — we don't merely refuse to quit. We will double and triple down, making additional decisions to commit more time and money (and other resources) toward the losing cause, and we will strengthen our belief that we are on the right path.

Incorporating uncertainty into the way we think about our beliefs comes with many benefits. By expressing our level of confidence in what we believe, we are shifting our approach to how we view the world. Acknowledging uncertainty is the first step in measuring and narrowing it. Incorporating uncertainty in the way we think about what we believe creates open-mindedness, moving us closer to a more objective stance toward information that disagrees with us.

The second is that making a plan for when to quit should be done long before you are facing the quitting decision. It recognizes, as Daniel Kahneman has pointed out, that the worst time to make a decision is when you're "in it."

When it comes to quitting, the most painful thing to quit is who you are.

We want outcome quality to align with decision quality.

this isn't what Levitt found. When he followed up with the coin flippers two and six months later, he discovered that for the big life decisions, people who quit were happier on average than people who stuck, whether they quit on their own or after the coin flipped in favor of quitting. While the decisions may have felt close to the people making them, they were not actually close at all. As judged by the participants' happiness, quitting was the clear winner. Because people were much happier when they quit what they considered a close decision, that shows that people are generally quitting too late.