How To Take Back Control? (Don’t let the tail wag the dog!)

When making decisions, it is tempting to mix the quality of the outcome with the quality of the decision. We typically link a positive result with a good decision and a negative result with a bad decision.

What is the trouble in doing so?

We draw conclusions by analyzing people and businesses that succeed. Successes or failures of others can be isolated incidents that may not accurately represent an overall trajectory.

Survivorship bias is particularly relevant in this context. It is a cognitive fallacy in which, when looking at a given group, you focus only on examples of successful individuals (the "survivors") in the selection process rather than the group as a whole (including the "non-survivors").

It can affect various areas of our life, including business, investing decisions, career choices, and personal development. It can distort our understanding of success and lead to faulty decision-making.?

When survivorship bias is present, we overestimate that uncertainty can get you a good outcome from a bad decision, and a bad outcome from a good decision. It's possible to experience unfavorable effects despite making good decisions and vice versa. Making decisions and sharing outcomes is not always a matter of black and white, good or bad.?

How can one prevent biased outcomes from influencing decision-making?

The ability to differentiate between being lucky and intelligent is essential for making progress quickly. Don't Let The Tail Wag The Dog! Otherwise said, don't overlook the less important parts and?take control of the crucial factors.

Create a “Decisions X Outcomes” framework to organize your decisions. It will assist you in avoiding biased patterns and progressing forward. It demonstrates that there will be times when:

?A bad decision can lead to some bad outcome (Deserved).

?A bad decision can lead to a good outcome (Dumb Luck).

?A good decision can give you bad outcome (Bad Luck).

?A good decision can deliver good outcome (Earned Reward).?

We have to deal with uncertainty and accept the role of luck in outcomes. We must avoid getting anchored to the outcome while evaluating the decision because we might be giving credit to the wrong decision. An outcome bias also reduces the capacity to take contrarian bets.?

Sometimes is necessary to go against the crowd in the fear, anguish, or regret of being wrong. Taking control of your decision-making is about considering the gains and odds. Take a holistic approach to make informed choices. Begin by focusing on the bigger picture.

We need to stick with the good as much as possible, but we do not need to always be right to get the most out of our decisions.??

How can we develop a mindset that allows us to learn from both good and bad outcomes without being solely influenced by them? Share your thoughts.?