The Decision Strategist

Here are some more thoughts that tend to reinforce the idea that making decisions with less information is better. There was a small conversation a few days ago on the post Do Decision Making Techniques Really Work? in which we talked about the difference between maximizers and satisficers.

Maximizers are people who seek out every option and as much information as they can find before they make a decision. Satisficers perform only a cursory search for information and then choose an option that satisfies and don’t worry much if it is the best choice.

There are a fair number of resources on the web about this, including this article, which includes a list of questions to help you determine which type of decision maker you are.

There are also several books that talk about this idea, including The Paradox of Choice: Why More Is Less. It’s just one of a slew of books having to do with quirky behaviors that have been published in the last few years. You can see some of them on my Amazon Wish List.

Satisficers are supposed to be generally happier because they stress less over decisions and don’t beat themselves up about making the wrong one, but the distinction strikes me as somewhat arbitrary. Isn’t it likely that we are all satisficers and maximizers in different situations?

I mentioned a while back that people invest more effort in decision making when they care more about the outcome, a fairly intuitive statement. It seems likely that we shift toward the maximizer side of things when we are contemplating more difficult decisions.

I recognize the value of simple intuitive concepts, but in this case I suspect that the maximizer/satisficer metaphor is a false dichotomy of sorts. Aren’t there really a number of other dimensions we could add to this characterization? At the very least other two-dimensional scales like level of self-confidence or being impulsive or thoughtful could explain the behavior with similar results.

The difference here is a focus on the information collection process. The benefit of gathering more information follows the familiar logistic S-curve found in population growth and a million other things:

The first few bits of information add some value, but may do more to confuse than anything else. In the middle of your search additional information adds a great deal of value. But at some point you’ve exhausted all the options or saturated your brains ability to hold information, and additional information does little to help.

Maximizers tend to stop searching for information somewhere on the upper end of the scale, while satisficers stop searching for information somewhere north of the center.

The key for people who have trouble making decisions is to recognize when their information search is no longer contributing value and making the decision based on their knowledge at that point.

Not that this is a simple matter. Without knowing the complete set of information it’s hard to tell whether your next information search will yield something of great value.

Perhaps the maximizer’s drive for information is not unlike a gambling addiction. Maybe they continue their search because they are driven by the big score of information in the next turn, just as a gambler is driven by the hope of the big payoff in the next game.

This post is a little rambling, but I think my general point is that the maximizer/satisficer metaphor, while a useful idea, glosses over the real issue, which is how do you tell when to stop searching for more information about a decision?

-zot

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This entry was posted on Tuesday, October 9th, 2007 at 10:17 am and is filed under Decision Making.