SUBSCRIPTIONS: THE HOTEL CALIFORNIA OF BUSINESS TRANSACTIONS

As colleague Eric Johnson has pointed out, the decision architecture – how we are brought through the decision process – has a huge impact on the decisions that are ultimately made. But, knowing that, unscrupulous or manipulative choice architects can structure decisions in a way that doesn’t favor you and lines their own pockets.

Rita McGrath ThoughtSparks

Human brains are a funny thing, as Kahnemann and Tversky researched years ago. We have what you can think of as two systems going on in our brains – one is fast thinking. That’s our normal default. Thinking quickly makes sense when the choice is routine, the consequences are minimal and the decision is reversible. But for situations where those rules don’t apply, we need what they call System 2 thinking, or slow thinking. These are for situations involving high uncertainty, big commitments and where the results are irreversible. You can see what this means by watching my Friday Fireside Chat with Danish geographer Bent Flyvbjerg.

Rita McGrath ThoughtSparks