About · Press · Contact · Write For Us · Top Personal Finance Blogs
Featured In:

5 Decision Making Skills & Techniques – The Emotional Brain

By Michael Lewis

thinking“Use your noodle! Your brain is like every other muscle in your body; by using it before you act, the fewer surprises you will have with a greater likelihood of getting the results you expect.”

My father’s sage advice more than 50 years ago continues to benefit me when I face a particularly knotty problem in my business, my investments, or my family. Whatever you call the process – “meditating,” “pondering,” “speculating,” or “noodling” – the manner of ensuring optimum outcomes through better decisions remains the same.

Though academicians and psychologists continue to explore and illuminate the mysteries of the human brain – specifically how we receive, process, interpret, manipulate, challenge, and implement information in the decision-making process – the counsel of that wise old man to his son to think before acting remains just as true for everyone today as it did in previous generations over the centuries.

What Is “Noodling”?

“Noodling” is a term for the process that occurs in the prefrontal cortex of the frontal lobes of the brain, and controls how we collect and process external information, reconcile and integrate our emotions, express ourselves, and control our behavior.

Dr. Alan Baddeley, a British psychologist, is credited with the term “mental sketch pad” described in his groundbreaking work, “Working Memory,” in 1986. Our individual mental sketch pads, or “cognitive maps,” enable each of us to collect information from disparate sources (memories of actual, as well as hypothetical or imagined, events), combine and coordinate them into rational episodes, and make an average of 35,000 decisions a day, each based upon the most desirable outcome of various projected possible solutions.

The Value of Emotions in Decision Making

Our distant ancestors were required to make life and death decisions with immediate consequences. Decisions to do nothing, flee, or fight needed to be evaluated and decided within milliseconds so thought processes, emanating from the “emotional” right-side of the brain outside of conscious awareness, stimulated immediate action. In other words, their “feelings” triggered their response.

Each time a predicted response is correct, a short-term memory is created and added to the database of the human mind. Whenever a similar situation subsequently arises, the brain, remembering the series of favorable results from previous responses and predicting a similar outcome, promotes a like response, usually on a subconscious level so that you are not even aware of the decision-making process itself.

When was the last time, for example, that you consciously decided to lift your foot higher when climbing stairs? Yet, the process leading to these  decisions is not unlike the process for decisions made when you drive a car, meet someone for the first time, or recognize that a math solution is correct.

The Power of the Emotional Brain

The presence and efficiency of our reactive, emotional brain, honed over millions of years of evolution, is most evident in professional sports. For example, a typical major-league pitch travels 90 feet from the pitcher’s hand to the catcher’s mitt in the average interval between two human heartbeats (about one-third of a second). At the same time, the batter requires about one-quarter of a second for his muscles to react after receiving a signal from the brain to swing. In fact, it takes an additional 20 milliseconds for the batter’s brain to respond to visual stimuli (the ball leaving the pitcher’s hand) under perfect laboratory conditions before sending the swing message to the muscles.

To be blunt, a batter simply cannot rationally decide on whether or not to swing by delaying his decision until the ball leaves the pitcher’s hand; he must decide to swing the bat before the pitch occurs. When asked how they made the decision to swing at a specific pitch,  most batters can’t logically explain their thought process. Their explanations are generally that the situation “felt right,” or that the pitch “looked good.” It is the emotional brain in action.

hitting a baseball

Imperfections of the Emotional Brain

Despite its almost perfect operation, our emotional brains suffer from a number of limitations:

1. A Preference for Immediate Results
Our emotional brains are strongly influenced by “rewards” and the “predictability” of the receipt of a reward. Dopamine, a simple organic chemical produced by nerve cells in the brain, signals the brain that a “reward” or a pleasurable feeling is forthcoming. The less time between the stimulus (prediction) and the receipt of the reward, the greater level of dopamine production.

As a consequence, immediate gains are overvalued in our analyses of worth, even when a greater reward could be received by waiting (delayed gratification). This anomaly underlies the successful marketing strategy of selling expensive products with extended payment terms.

2. An Exaggerated Aversion to Risk
While humans’ propensity for pleasure is incredibly strong, our abhorrence of loss or discomfort is even more intense. As a consequence, we and other animals avoid situations which seem “risky” or where the possibility of discomfort exists.

In their paper “Prospect Theory: An Analysis of Decision Under Risk” published in 1979, Nobel Prize-winner psychologist Daniel Kahneman and coauthor psychologist Amos Tversky discovered that the magnitude of gain had to be disproportionally skewed to favor reward before a risky behavior would be undertaken. As a result, humans are more likely to make an erroneous decision when any risk of loss is perceived to be present.

3. Easy Manipulation
From the brain’s perspective, there is little difference between an imaginary or fantastical experience and reality. Either can generate high dopamine levels and lead to impulsive decisions which, examined in hindsight, make no rational sense.

Advertisers and successful salesmen understand this biological tendency for pleasure and combine images, sounds, and words to stimulate dopamine production. Certain drugs such as cocaine, heroin, and alcohol stimulate dopamine and often lead to addiction – the same is true for pleasurable activities such as gambling, smoking, and fantasized sex (pornography).

4. Perceptual Narrowing During Stress
The autonomous nervous system and the emotional brain work hand-in-hand to facilitate the survival of the species. During stress, our heart and breathing rates increase, the pupils of our eyes enlarge to heighten sensitivity while decreasing peripheral vision, and our awareness of sound or audible information diminish. These physical changes occur rapidly and automatically, preparing the body for action.

If you were to experience a life-threatening event, these changes would be beneficial. However, when they occur while sitting in a meeting at work, they can be quite disorienting. Under stress, our emotional brain fails to evaluate all of the information available, focusing laser-like on the immediate danger or reward.

making a business decision

Noodling Techniques to Improve Decision Making

1. Slow Down to Speed Up
“We’re being trained to prefer an immediate decision, even if it’s bad to a later decision that’s better,” says psychologist Clifford Nass of Stanford University. “In business, we’re seeing a preference for the quick over the right, in large part because so many decisions have to be made. The notion that the quick decision is better is becoming normative.”

But quick decisions are not always the best decisions. Being struck out at the plate is not the same as losing one’s retirement fund to an unscrupulous salesman. Time allows our rational brain to consider all of the available information, multiple solutions and probable outcomes, and make judicious choices.

2. K.I.S.S.
Kelly Johnson, an aeronautical design engineer and the leader of the famed Lockheed Martin Skunk Works, is credited with the now famous acronym K.I.S.S., or “Keep it simple, Stupid.” Johnson understood that even experts become anxious and mentally exhausted when they try to absorb too much information from too many sources. As a result, they overlook critical data, misinterpret relationships and consequences, and make critical errors.

Some have analogized the situation to a thirsty man trying to drink from a fire house. In such instances, it is better to step back and reexamine the data for pertinence, reliability, and application, discarding the irrelevant and trivial to focus on the main drivers and the most desirable outcome.

3. Ask “What If?
Dr. Simon Baron-Colon of the University of Cambridge defined the human ability to “imagine” as a “meta-representational capacity.” Business theorist Peter Schwartz, the author of “The Art of the Long View,” calls its use in strategy “scenario planning,” a creative process to develop a variety of plausible future outcomes as the result of a specific decision and how the business would be affected in each. While scenario planning is no guarantee of a good decision, its use will invariably broaden your options and reduce the chances of a surprise or unintended outcome.

4. Sleep on It
“If you let things come at you all the time, you can’t use additional information to make a creative leap or a wise judgment,” says psychologist and author Joanne Cantor in her 2009 book “Conquer Cyber Overload.” “You need to pull back from the constant influx and take a break.”

Taking a break, even sleeping overnight, allows the brain to subconsciously integrate new information with existing knowledge, make novel connections, and see hidden patterns. In contrast, a constant focus on the latest data makes it harder for information to percolate just below conscious awareness, where it can combine in ways that spark smart decisions.

5. Trust Your Instincts
By and large, our emotional mind has served mankind superbly for millions of years. We continue to rely upon it for most of our decisions because it leads to a good outcome most of the time. The best decisions, however, are those decisions that we can rationally make that also “feel good” – those instances when you’ve done your homework, considered all of the facts, and the decision coincides with your intuition, another term for your emotional brain’s ability to acquire knowledge without reason.

Final Word

“What did you think would happen when you left your bicycle unlocked in front of the store?” Fifty years later, I still find myself jumping to conclusions, letting my emotions get the better of me, and making illogical decisions. But every mistake is a learning experience, a memory that adds to my mental catalogue and prompts me to “use my noodle” in the future, with better outcomes and less surprises in my life and business career.

Michael Lewis
Michael R. Lewis is a retired corporate executive and entrepreneur. During his 40+ year career, Lewis created and sold ten different companies ranging from oil exploration to healthcare software. He has also been a Registered Investment Adviser with the SEC, a Principal of one of the larger management consulting firms in the country, and a Senior Vice President of the largest not-for-profit health insurer in the United States.

Related Articles

Comments

Links monetized by VigLink
Close