We are not nearly as rational as we like to think

Rationality

We make 35,000 decisions every day. If you have stopped to count your decisions in a day, then you will probably be hard pressed to come up with more than a few, that you actually really thought through. So where does the rest go?

Well, the marvel of our brain developed millions of years ago to ensure our survival, is that we have an ever vigilant automatic system 1 based on our human instincts around what is safe, interesting, valuable – and what is not. This system will make by far most of your decisions in a day – and that is great for fast decision making.

What is not so great, is when this system proposes decisions to your more thoughtful system 2, which sounds great, feels great and makes it easy for system 2 to endorse, but makes little rational sense, if you actually stopped to think about it. This is the reason that we are rarely stupefied – we almost always have an intuitive answer, that we can relatively quickly rationalise afterwards.

Now many decisions are not that difficult – and many are not that critical. But sometimes you make strategic decisions that make or break a career, a company or even a country. Even if you decide you want to think that one through, you will constantly be bombarded with your system 1 suggestions – and most of the time you will take them, because they certainly sound rational. This is why 70% of all strategic initiatives fail.

Because strategy is the most critical decisions we make – after all it is about what we decide to do and decide not to do – and almost all strategy making today is based on this wrong idea about how we can be rational, we believe that Behavioural Strategy Group represents next practice consulting. We take the same top tier strategy approach but underpin it with a knowledge about of how people really decide and execute.

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