Three psychological concepts that can help you make better decisions

by Aanuoluwapo Akande

 

How do you make decisions? Do you think you are the pragmatic type who makes decisions mostly based on raw facts and logic? Or maybe you are the type who believes decisions are influenced by both reality and perception? 

 

Whatever type you are, most times, your decisions are not based on logic alone but are sometimes influenced by emotions, bias and perception. And the thing about perception is; it can be a double-edged sword. It can either help you to make good decisions or it can mar your attempt to make one.  

 

Now, the psychological concepts that will be explained in this article will help you to see how perception can negatively influence your decision-making process so next time you’re making a decision, you can watch out for those moments when your bias and perception get in the way of making a sound and good decision. 

 

The first psychological concept is the horn effect. The horn effect is when a negative first impression about an individual influences how you subsequently treat them. You may think this is above you but the horn effect is just like any other perception concept; it may be subconscious and not intentionally used to make decisions. 

 

A typical example of a horn effect is when an interviewer judges that a 'fat and conventionally unattractive’ individual might be unintelligent and unfit for the job. Consequently, they may undermine whatever intelligent opinion such a person might provide during the interview.  

 

Now, your own experience may not be as vivid as the one used in the example but can you think of any situation when the horn effect may have influenced the decision you made? If you remember any of them, it's good you're aware that you are also prone to the horn effect so next time you want to make a decision,  you can ask yourself, is the horn effect in play here?  

 

Haggling is an important part of buying and selling in the Nigerian market. Will you buy the goods at the stated price? Will you buy it at a lower price? Or will you buy at a much lower price? At the end of the day, you have to make a decision which can include either walking away or buying it at a certain price. At that point, it all boils down to how good you are at deciding on a price that will benefit both you and the seller.  

 

One psychological concept that may help you in this situation and even in any situation that has to do with decision-making is the anchoring bias. It's the tendency to rely on the first piece of information when making decisions even if it's irrelevant.  

 

A trader tells you the price of a bag is 1500 so you start haggling with the price of 15000 in mind but what if the original price of the bag is 1000? So knowledge of the anchoring bias is not only to help you think twice about the information you were given but it's also to prevent over-reliance on the first information you were given.  

 

Another concept that highlights the influence of bias in decision-making is the confirmation bias. If you're arguing with someone who believes left-handed people are more creative than right-handed individuals and they give you examples of creative left-handed individuals to prove their point. What they are doing without realizing it is that they are concentrating on information that supports their beliefs and ignoring those that do not. That is an example of confirmation bias and it may influence our everyday decisions more than we think.  

 

When you are in support of something or you lean more toward one decision rather than the other, you tend to look for more information to support your belief. This can be detrimental to a good decision-making process because you need information that both supports and criticizes an idea before you can make a good and well-informed decision.  

 

 

You are now informed of these psychological concepts. The next thing is to examine the decisions you make and ask yourself;  do you actually critically think about them? I mean, we say we do but don't our perceptions, biases and social behavior influence the decisions we make? And yes, while perception can help you make good decisions it can also help you make bad ones too. So it's important to think of these concepts when making decisions and ask yourself; am I making this decision as a result of the horn effect? Is the confirmation bias in play here? Or am I making the decision as a result of the anchoring bias?