{"id":76388,"date":"2022-08-17T16:46:00","date_gmt":"2022-08-17T20:46:00","guid":{"rendered":"https:\/\/www.shortform.com\/blog\/?p=76388"},"modified":"2022-08-24T09:13:22","modified_gmt":"2022-08-24T13:13:22","slug":"mental-models-for-decision-making","status":"publish","type":"post","link":"https:\/\/www.shortform.com\/blog\/mental-models-for-decision-making\/","title":{"rendered":"The 3 Best Mental Models for Decision-Making"},"content":{"rendered":"\n<p>When you have more than one option, how do you know which one to choose? Can you actually train yourself to <a href=\"https:\/\/www.shortform.com\/blog\/make-better-decisions\/\">make better decisions<\/a>?<\/p>\n\n\n\n<p>Let&#8217;s say that you&#8217;ve received a job offer at a great company. You&#8217;re pretty happy where you are now, but the new opportunity might be the right move to make. If you carefully consider the consequences (<a href=\"https:\/\/www.shortform.com\/blog\/second-order-thinking\/\">second-order thinking<\/a>), the chances (<a href=\"https:\/\/www.shortform.com\/blog\/probabilistic-thinking\/\">probabilistic thinking<\/a>), and the possibilities (<a href=\"https:\/\/www.shortform.com\/blog\/possibility-thinking\/\">possibility thinking<\/a>), you&#8217;ll likely make the right decision.<\/p>\n\n\n\n<p>Read more to learn how to use these three <a href=\"https:\/\/www.shortform.com\/blog\/increase-focus\/\">mental models<\/a> for <a href=\"https:\/\/www.shortform.com\/blog\/methods-of-decision-making-crucial-conversations\/\">decision-making<\/a>.<\/p>\n\n\n\n<!--more-->\n\n\n\n<h2 class=\"wp-block-heading\">Mental Models for Decision-Making<\/h2>\n\n\n\n<p>Three of the great mental models presented in <em>The Great Mental Models Volume 1<\/em> by Shane Parrish and Rhiannon Beaubien can be grouped together as basic systems thinking. Put together, they are excellent mental models for decision-making:<\/p>\n\n\n\n<p><strong>Second-Order Thinking: <\/strong>Since anything you do has downstream effects, consider the immediate <em>and<\/em> secondary effects of any choice. According to the authors, many decisions that have immediate positive results have negative consequences down the road. By thinking ahead, you can predict and prevent unwanted outcomes.<\/p>\n\n\n\n<p><strong>Probabilistic Thinking:<\/strong> The authors recommend using probability techniques to explore the most likely consequences of any decision:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><a href=\"https:\/\/www.shortform.com\/blog\/bayesian-approach\/\">Bayesian thinking<\/a>: evaluating new information in light of what you already know and being willing to update your beliefs when new and compelling information comes along<\/li><li>Fat-tailed curves: Understanding that some domains (such as finance) are more prone to extreme outlier events and don&#8217;t fit the normal distribution <a href=\"https:\/\/www.shortform.com\/blog\/the-bell-curve\/\">bell curve<\/a>.<\/li><li>Asymmetries: The authors say that we often overestimate how accurate our probability estimates are. We need to remember this and scrutinize our thinking.<\/li><\/ul>\n\n\n\n<p><strong>Possibility Thinking:<\/strong> For problems that you can\u2019t test directly, <a href=\"https:\/\/www.shortform.com\/blog\/philosophical-thought-experiments\/\">thought experiments<\/a> allow you to consider all of the possibilities. In other words, you use imagination to rigorously explore what\u2019s possible.<\/p>\n\n\n\n<p>These three models help you consider the consequences of any decision, how estimating probabilities can narrow those decisions, and how you can use imagination to explore the possible outcomes of a choice. Put together, these models help you navigate <a href=\"https:\/\/www.shortform.com\/blog\/making-hard-decisions\/\">difficult decisions<\/a> in a world where every choice you make has immediate and downstream effects.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-applying-the-models\">Applying the Models<\/h3>\n\n\n\n<p>To apply the models in this group, <strong>try making a checklist that walks you through each of the above considerations<\/strong>. Then, consult this checklist when faced with any consequential decision, and think it through using each model that applies.<\/p>\n\n\n\n<p>For example, imagine you\u2019ve been offered a job at a major company in your field, and you need to decide whether or not to leave your current position. To decide, go through your considerations checklist:<\/p>\n\n\n\n<p><strong>Step #1: Consider the consequences\u2014<\/strong>Thinking through what could happen, you notice the following: You\u2019ll get a <a href=\"https:\/\/www.shortform.com\/blog\/2023-salary-increase\/\">pay increase<\/a>, but you\u2019ll also have to work longer hours. Further, the new role gives you fewer opportunities to develop additional skills, while your current company gives you many. However, there\u2019s a chance you could meet some influential players at the new company\u2019s events, and you might get promoted down the road. Given all this, taking the new job has both immediate pros and cons, as well as downstream pros and cons.&nbsp;<\/p>\n\n\n\n<p><strong>Step #2: Consider the chances\u2014<\/strong>To narrow down what\u2019s worth your attention, calculate some probabilities. For instance, you estimate that while you might make some powerful connections in the new role, the chances are fairly slim. In this case, you can give that factor less weight when making your decision.<\/p>\n\n\n\n<p><strong>Step #3: <a href=\"https:\/\/www.shortform.com\/blog\/consider-the-possibilities\/\">Consider the possibilities<\/a><\/strong>\u2014Last, you decide to imagine what else is possible. You ask whether this new role is really such a great opportunity, and you imagine what else could happen if you don\u2019t take it. Could you find other, better opportunities? Could your current role improve or expand?<\/p>\n\n\n\n<p>Put together, these models clarify the factors and broaden your view of the problem. In the end, you decide that the probable immediate and downstream effects of the new job\u2014longer hours, thus higher stress, plus fewer opportunities for growth\u2014aren\u2019t worth the less probable payoffs.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>When you have more than one option, how do you know which one to choose? Can you actually train yourself to make better decisions? Let&#8217;s say that you&#8217;ve received a job offer at a great company. You&#8217;re pretty happy where you are now, but the new opportunity might be the right move to make. If you carefully consider the consequences (second-order thinking), the chances (probabilistic thinking), and the possibilities (possibility thinking), you&#8217;ll likely make the right decision. Read more to learn how to use these three mental models for decision-making.<\/p>\n","protected":false},"author":9,"featured_media":76394,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[29,14,43],"tags":[724],"class_list":["post-76388","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-career","category-management","category-self-improvement","tag-the-great-mental-models-volume-1","","tg-column-two"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v24.3 (Yoast SEO v24.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The 3 Best Mental Models for Decision-Making - Shortform Books<\/title>\n<meta name=\"description\" content=\"If you consider consequences, chances, and possibilities, you&#039;ll likely make the best choice. Learn three mental models for decision-making.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.shortform.com\/blog\/mental-models-for-decision-making\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The 3 Best Mental Models for Decision-Making\" \/>\n<meta property=\"og:description\" content=\"If you consider consequences, chances, and possibilities, you&#039;ll likely make the best choice. 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