His Capital Group

2151 Consulate Dr. Suite 6 ​​​​​​​Orlando, FL 32837

His Capital Group

9AM - 6PM
Mon-Fri

His Capital Group

info@hisrealestatenetwork.com
+1-407-347-6461

Taking-the-Emotion-out-of-Decision-Making

Taking The Emotion Out Of Decision Making

Most every facet of our lives has been affected throughout this Corona Pandemic and one thing is certain, the future ahead is uncertain.  The second quarter economic collapse was unrivaled in its speed and severity. In fact, the decline was twice as large as what took place in 2008 in a fraction of the time.  Business owners are faced with making some of the most difficult and critical decisions ever merely to survive.  Combine that with the task of letting employees go and wondering if they can provide for their own families, many of these decisions are made in a state of emotional duress rather than logic and that can be fatal.

Psychological studies indicate that emotion and instincts drive our decision making and only after that, do we conduct our diligence merely to justify the decision.  But under duress our tendencies lean to greater risk taking without logical oversight and that is a recipe for disaster.

The same thought applies to our investment decisions. Knowing when your decisions come from a place of risk, fear, or safety can help you determine if your actions are logical.  In a recent interview with neuroscience expert Jeff Bloomfield, CEO of Braintrust, we learned that humans typically feel twice the urgency to avoid a perceived loss than a potential gain! He shared a couple methods that may help to ensure our decision making is sound.  The current climate has obviously heightened our emotional state so one simple exercise we can do is to fill in the blanks of the following sentence: “I feel like I need to (a perceived action). If I don’t do this (perceived action) then the outcome is potentially _______________ and that makes me feel ___________.

I’ve tried this several times over the past few months and have found that the reality is if we focused on potential gains available rather than perceived losses, we would be much better off.

However, to truly understand what decision makes the most sense we have to take another step, which is a technique Bloomfield calls the “Cascade of Consequence” to help our team make better decisions. For each decision you make run thru each of the four questions to follow:

  • What will happen in the next 30-60-90 days if we take this action?
  • How will this action or inaction affect our cash flow?
  • How will this action or inaction affect our employees?
  • How will this action or inaction affect our customers/clients?

These questions are a great start, but the real benefit of this exercise comes when you tailor it to your business by adding more questions and getting clearer on what area you need to look at for each decision. Breaking it down on paper will go a long way to making rational logic-based decisions, minimizing those that are emotionally driven.  This also translates well into our personal lives.

 

Share this post

Share on facebook
Share on google
Share on twitter
Share on linkedin
Share on pinterest