Head & Heart Decisions

May 22, 2008

There are two key beliefs in decision making. One is that the more important the decision the longer that you take in making it. The second is the belief that by taking a longer time you make better decisions.

But is this the case? Recent research by A Dijksterhuis & L Nordgren from the University of Amsterdam suggests that many people do use a rational, deliberate decision making process for items such as a toaster. They consider such features as price, brand, quality, energy ratings etc and make an informed, rational decision.

However, what is the most important financial decision many people make in their life? To buy a house you might say. But how many people have carefully drawn up a list of house attributes with some form of rating (e.g. it must be close to a school) and when they walk into a house simply say this is it. I must have it even if many of the attributes are missing!

This behaviour reminds us that we are human and that we when we make decisions it is a rational and emotional conversation. That is why we have designed the ‘head and heart’ tool. In two minutes we ask participants to list all the rational factors (e.g. price) they might consider then in the next two minutes what are the emotional features of a decision (e.g. pride). By having these ‘out on the table’, these can be discussed and people can often make better and faster decisions.

Ken Hudson

Posted by Dr Ken Hudson | Filed Under Decision Making