How to Make Smart Decisions Without Getting Lucky

How to Make Smart Decisions Without Getting Lucky

"The older I get the more I realize how many kinds of smart there are. There are a lot of kinds of smart. There are a lot of kinds of stupid, too." - Jeff Bezos

Making decisions is not a single skill, but rather a collection of tools and frameworks. Good decision-makers possess diverse mental frameworks and tools that allow them to consistently make smart choices. However, we often find ourselves making decisions based on luck or incomplete information. In order to make smart decisions without relying on luck, there are several key points to consider.

Firstly, it is important to recognize that we already think in mental models. Mental models are the lenses through which we perceive and interpret the world. They shape our understanding and guide our decision-making process. However, some decisions are more critical than others, and they have a lasting impact on our lives. Whether it's choosing whom to trust, where to live, or whom to marry, these decisions have far-reaching consequences. In such cases, we often resort to the traditional pro-con list, weighing the positives against the negatives. But is this method enough to ensure a smart decision?

Thomas Edison once said, "I regard it as a criminal waste of time to go through the slow and painful ordeal of ascertaining things for one's self if these same things have already been ascertained and made available by others." This brings us to the second point: unintentional ignorance. We like to believe that we are rational beings capable of making unbiased decisions, but the reality is that we are often ignorant of the right information. Making decisions based on false assumptions or incomplete facts is a recipe for disaster.

The third point to consider is the use of the wrong mental model. Our decision-making process heavily relies on mental models, but using the wrong model can lead to poor choices. It is crucial to have a repertoire of diverse mental models and to choose the most appropriate one for each situation. By expanding our mental toolkit, we increase our chances of making smart decisions.

The fourth point revolves around the concept of learning. If we fail to learn from our past decisions, we are destined to repeat the same mistakes over and over again. Understanding how we learn and being aware of our cognitive biases can help us break free from this cycle of repetition. By reflecting on our past decisions and analyzing the outcomes, we can gain valuable insights that will inform our future choices.

Lastly, our evolutionary programming often prioritizes feeling good about ourselves over doing what is right. We tend to choose the path of least resistance, even if it means sacrificing long-term benefits. This inclination towards instant gratification can hinder our ability to make smart decisions. It is important to overcome this bias and prioritize the outcomes we desire over the immediate satisfaction of feeling good.