Fresh perspective for financial success

Being More Decisive: Prepare to Be Wrong

In this series, I have presented a decision-making framework and outlined the first three steps of process that, applied over the long term, will help you make better decisions. In this conclusion, we will discuss the final step in the WRAP process proposed by the Heath brothers in “Decisive.” Prepare to be wrong.

In general we are over confident. Doctors completely certain about a diagnosis have been shown to be wrong 40 percent of the time. Other research has shown that medical students that thought they only had a one percent chance of being wrong were wrong 27 percent of the time. You simply cannot shine a spotlight on an outcome that you fail to consider.

We have been using the example of my colleague, who is considering whether she should become an employed physician or stay in private practice. My colleague thinks that her life as an employed physician is likely going to be significantly better, but she cannot really be sure. The overconfidence mentioned above tends to shift into other aspects of our lives. The concepts of “premortem” and “preparade” can help bookend future outcomes, both bad and good. In fact, research has demonstrated that estimates actually improve when people are asked to explicitly take into consideration a high- and low- end of a range. The idea is that when you expand the range of what is possible, this better reflects reality.

While you cannot predict the future, you can systematically think about both bad and good outcomes. My colleague might ask herself how likely it is that becoming an employed physician would be a fiasco and write down a few reasons why this might occur. A better exercise is to assume it is 12 months from now, that quitting private practice was a total fiasco and write down the reasons for it being such a miserable failure. Not only does this premortem lead to more responses, but you are more likely to generate specific answers. In addition to identifying why a course of action did not work out, consider what you plan to do next. You can then prepare to be wrong. You are describing the lower bookend and trying to do things to avoid it.

The preparade asks just the opposite of the premortem. You would go through the same exercise on the positive side. Assume it is 12 months from now and quitting private practice was a total success. Now ask yourself how to prepare for such a favorable outcome.

The premortem and the preparade can help you identify both risks for failure and opportunities for success.

A “failure mode and effect analysis” or FMEA is a similar exercise that many professionals might be more comfortable with. In this exercise you identify all parts of a plan that could go wrong. For each potential failure you ask, “How likely is it?” and “How severe would the consequences be?” Assign a score from 1 to 10 for both likelihood and severity, then multiply the two numbers to get a total. The highest totals represent the most severe potential failure and garner the most planning and attention.

The FMEA, premortem, and preparade stop us from guessing about the future and force us to address the uncertainty in our estimates. While the premortem and FMEA help us overcome overconfidence, the preparade helps you prepare for a good situation. Rather than prepare for a single point, bookending forces you to consider a range of outcomes from very bad to very good. Not only will this exercise lead to more realistic possibilities, anticipating both problems and success helps you prepare for them.

I hope you have enjoyed this series of articles and realize that it is not a panacea for decision making. Rather it is a process that will lead to better decisions over time and its true value lies in making it part of your everyday decision making process.

Dr. Pat Bass

Dr. Pat Bass is a physician, writer, educator and scientist that cares for both adults and children. Currently an Associate Professor of Medicine & Pediatrics at Louisiana State University Health Science Center in Shreveport, he participates in an active clinical practice, medical education activities and health literacy research. View full bio on authors page