Using emotional judgement to reduce biases in decision-making

Posted 10 Apr 2015 by Paul Deakin - Business psychologist and psychometrics expert
Decision-making

People make decisions largely on the basis of intuition and emotion. We might like to think otherwise, but it’s true. Even the most logical and rational amongst us find our cognitive functioning heavily influenced by a broad range of both positive and negative emotions.

Current opinion amongst psychologists (eg Kahneman) suggests that decision-making is underpinned by two parallel but linked thinking processes – system 1 and system 2. System 1 thinking is fast, emotional, instinctive, and beyond our conscious control; while system 2 is more conscious and deliberate, and requires more effort.  Most of the time we use system 1, which generally serves us well in managing the sheer number of decisions we need to make every day. But the way we use heuristics (or rules of thumb) to simplify the world around us comes at a cost.

The emotional cues we use to help our system 1 thinking bring benefits to everyday decision-making (Bechara et al), but make us susceptible to a range of cognitive biases, including anchoring, confirmation bias, sunk cost effects, status quo bias, and many more.

One question that fascinates me is to what extent are different individuals naturally susceptible to these various biases? Building from this, how can we reduce the impact of bias on our own decision-making?

As with many things, improved self-awareness is a good starting point. If we take someone who has an MBTI® preference for Sensing, type theory would suggest that he or she would focus on the present but would value past precedents when deciding upon a course of action. This could manifest itself in the person making decisions favouring the status quo rather than change (potentially a focus on avoiding losses rather than acquiring gains, known as 'loss aversion'). To give another example, a person with a preference for Extraversion may prefer discussing important issues before making decisions. This could lead to confirmation bias – subconsciously approaching people who are likely to support your views.

The examples above are only hypotheses. However, they do illustrate how bias can affect the decisions we make and how we might be more or less prone to particular ones. An awareness of potential biases is useful and goes some way towards reducing any detrimental impact on important decisions. Further benefits can be gained from emotional intelligence – that is, looking more directly at how we deal with emotions.

Emotional intelligence can be defined as the ability to monitor one's own and other people's emotions, to discriminate between different emotions and label them appropriately and to use emotional information to guide thinking and behaviour (Coleman).

Although emotions per se are probably not detrimental to decision-making, the way we learn to recognise and regulate our emotions is likely to help determine whether they have positive or negative impacts on our decision-making ability. This is where a measure of emotional intelligence such as the Emotional Judgment Inventory (EJI) can add value. Containing seven scales that look at how sensitive an individual is to his or her own emotions, and to the emotions of others, the EJI can help individuals increase their awareness of how they recognise and regulate their emotions. This can help reduce bias in decision-making – just one of the many benefits associated with developing an increased sensitivity towards emotions.

For example, individuals scoring low on the Identifying Own Emotions scale of the EJI are often not clear about how they feel; they may experience emotions without knowing why they are feeling the way they do, and can have trouble distinguishing between similar emotions, such as anger and frustration. This confusion can result in decisions being made as a result of incorrect assumptions, with poor outcomes giving rise to negative feedback, further undefined emotions and a spiral of dysfunctional behaviour. To take another example, those scoring high on the scale of Using Emotions in Problem Solving tend to recognize when and how their emotional experiences influence their performance, and may also attempt to create mood states that facilitate the tasks on which they are focusing. This facilitates good decision-making. All of these areas of emotional judgement can be developed, helping to increase the efficacy of our decisions.

None of us are free from the biases of system 1 thinking, but by increasing our self-awareness around our own emotional judgement, and developing our emotional intelligence, we are more likely to make good, informed, thought-through decisions.

 

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