A632.1.4.RB_MaceRoyce
Chapter 3 of the Wharton text discusses the power of everyday reasoning in multistage decision-making. The text discusses the way that researchers solve multistage problems through the application of formulas that provide the most significant chance of success. Critically think about your own decision-making process and reflect on the process you use compared to the process outlined in the article. Would this improve your decision-making? What would the impact be on forward planning? How would you apply optimal dynamic decision analysis to predict future impact of today's decision?
In critically-thinking and reflecting on my own decision-making processes, I personally combine the ideas of formulation, emotion (both positive and negative), and past experiences as described by Hoch, Kunreuther, & Gunther (2001). The formulation approach to decision making is not a practical approach in most of my decision making situations, but I do find that utilizing formulas in more of my current financial decisions have helped in making more sound and positive investments for my future and the future of my family.
For example, as a young adult in my mid-twenties (now 32 years old), I would avoid calculating the true cost of a purchase and base purchases (cars, clothes, watches, etc.) on emotions (wants). Having learned more about investing (needs), being married, and the poor financial purchases from the past, I have learned to use formulas more often and how to eradicate negative emotions when facing the decision making process. By learning from past events, negating negative emotions, and acquiring the necessary calculating skills, I am now enabled to make much better decisions in my early thirties as opposed to my twenties and teenage years.
Learning to formulate the decisions that require them has been the biggest lesson moving forward. It took time and lessons to learn, but the present is much easier when discerning between the decisions that require quantifiable thought and those that do not. In remembering the optimal dynamic decision analysis theory, the key is to remember the lessons that we have been given, both positive and negative, and to remember the effect that bias has on us when meeting decisions head-on. Analyzing the new data presented and avoiding bias while remembering lessons learned, emotional status, and when to/when not to formulate decisions gives me the best framework when approaching a broad spectrum of decisions now and in the future.
References
Hoch, S. J., Kunreuther, H., Gunther, R. E. (2001). Wharton on making decisions. New York: Wiley.
In critically-thinking and reflecting on my own decision-making processes, I personally combine the ideas of formulation, emotion (both positive and negative), and past experiences as described by Hoch, Kunreuther, & Gunther (2001). The formulation approach to decision making is not a practical approach in most of my decision making situations, but I do find that utilizing formulas in more of my current financial decisions have helped in making more sound and positive investments for my future and the future of my family.
For example, as a young adult in my mid-twenties (now 32 years old), I would avoid calculating the true cost of a purchase and base purchases (cars, clothes, watches, etc.) on emotions (wants). Having learned more about investing (needs), being married, and the poor financial purchases from the past, I have learned to use formulas more often and how to eradicate negative emotions when facing the decision making process. By learning from past events, negating negative emotions, and acquiring the necessary calculating skills, I am now enabled to make much better decisions in my early thirties as opposed to my twenties and teenage years.
Learning to formulate the decisions that require them has been the biggest lesson moving forward. It took time and lessons to learn, but the present is much easier when discerning between the decisions that require quantifiable thought and those that do not. In remembering the optimal dynamic decision analysis theory, the key is to remember the lessons that we have been given, both positive and negative, and to remember the effect that bias has on us when meeting decisions head-on. Analyzing the new data presented and avoiding bias while remembering lessons learned, emotional status, and when to/when not to formulate decisions gives me the best framework when approaching a broad spectrum of decisions now and in the future.
References
Hoch, S. J., Kunreuther, H., Gunther, R. E. (2001). Wharton on making decisions. New York: Wiley.
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