Complex decision-making - the power of beliefs

We've been doing a lot of work around how people make decisions, often where there is a mass of (sometimes conflicting) information or where there is a great deal of uncertainty, risk or ambiguity.  A new book, published in February this year, 'Market Mind Games' by Denise Shull puts another perspective on the topic.  (We will be posting up a review in the near future).  She looks at both the emotional and cognitive aspects of decision-making in one of the most high-pressure business environments, that of financial trading.  The subject of this post is her take on beliefs, which I found highly interesting, a great summary of what they are and how they work and importantly, intuitively sensible!  She says that beliefs are formed from both internal and external sources, and that once formed they influence our behaviour and are the source of what gives as that feeling of whether something is 'right' or 'wrong' when we are facing a novel situation.  She also adds that they contain both a cognitive and an emotional element.  As she puts it in her chapter, 

'Is it possible to believe in something that you simultaneously feel is incorrect?'  

Hence, we can decide on a course of action not just because the data suggests it is the correct thing to do, but because it feels right too.  In fact, when the pressure is on, making decisions based on feelings may be the only way of performing well.

But, interestingly, she also points to research that since it is possible for an external agent to easily manipulate our feelings we can be also be mis-led.  The context provides a 'feelings state' which then influences our perception and ultimately the decision that we take.  It seems that feelings play a vital part in making complex decisions, but we also need to be aware of just why we are feeling any particular emotion at any particular time.  Perhaps this provides a reason for why Emotional Intelligence is such a hot topic at the moment.  Without self-awareness, can we be trusted to do the right thing?

If you want to know more about decision-making, have a look at our '1 Page Book Reviews' in the Executive Lounge section of our website www.enthiostraining.co.uk, in particular 'How we Decide' by Lehrer and 'The Upside of Irrationality' by Ariely.