How to Decide When Stakes Are High?

In 2011, researcher Ap Dijksterhuis and team asked experimental subjects to make purchasing decisions for a clothing item either slowly or quickly. In the first case, they were allowed to take time to think; for the second group, they had to decide their choices quickly. The ones who took time to decide were more satisfied with their choices than the ones who decided impulsively.

In another experiment, they asked subjects to make their choices for buying a car from 4 given options—a high-stakes decision. They were to use four criteria. One group had time to carefully analyze their options. Another group was given time to go through the choices but then was interrupted with a cross-word puzzle and asked to make their decisions quickly. In this high-stakes decision, too, taking time to think led to people making the right choices more than half the time. The quick decision-making group performed worse.

What happens if the decision is more complex? In a new experiment, subjects had to choose from 4 cars, using 12-point criteria instead of 4 in the earlier case. The first group had 4 minutes to analyze their choices; the second group had two minutes to analyze the options and was then distracted with a 2-minute cross-word puzzle. They were then forced to make a quick decision.

In this highly complex scenario, the group that made impulsive decisions after being distracted made the correct decisions 60% of the time, whereas the analysis group made the correct decisions only 25% of the time.

When you have to make complex, high-stakes decisions, your deliberate, slow-thinking system cannot recruit the large brain capacity required to solve the problem. On the other hand, your fast-acting intuitive system can utilize a larger brain capacity to arrive at decisions.

This does not mean that we should make quick decisions; it only means that we allow our unconscious, intuitive system time to reflect on the choices without our conscious awareness. How do we do that?

We do this by allowing our minds to wander, by getting distracted, or by sleeping on the problem. In most deliberate decision-making cases, we can make use of this system by doing a deliberate, in-depth analysis and then leaving the problem for our unconscious to solve. This means we stop thinking about it.

As you have heard, many creative people have their insights or epiphanies while not focusing on the problem- when they are in the shower, taking a walk, or doing something mindless.

Psychology professor Barry Schwartz shows that having too many choices makes decision-making difficult. When there are too many choices, we can use the intuitive thinking system to make decisions. So, if the decision is high-stakes but straightforward, go for thoughtful analysis. If it is high-stakes but complex, do an analysis and then stop thinking.