Decision/ Intuition article:“Decision Making: going forward in reverse” by Einhorn and Hogarth

To understand thinking forward, an understanding of thinking backward is important. Thinking backward involves looking for patterns, making links, testing possibilities, and finding metaphors or theories. Thinking forward is not intuition based but depends on making predictions based on variables and mathematical formulations.  The authors suggest that many think backwards but there is a better way to thinking backwards. They give several approaches to improve thinking, which include the following: use several metaphors to experiment with, do not rely on one cue alone, sometimes go against the cues, assess causal chains, generate and test alternative explanations. When thinking forward, the authors give the following advice about following physiologically tested models : models make errors, models are static, and models are not worth their cost. Einhorn and Hogarth describe the two forms of thinking (backwards and forwards), and find that the two modes are not two dependant forms of decision making but interdependent. By putting the two modes of thinking as in interdependent form of decision making, allows managers and executives to make decisions with the best form of intuition and understanding.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: