Possible outcomes and their probabilities
Decision Focus 06 - Important Information
Useful information is anything we know, would like to know, or should know that might influence our decision-making but that is not under our control. Decision Trees are useful for mapping probabilities of success for various alternatives.
Useful information is anything we know, would like to know, or should know that might influence our decision- making but that is not under our control. This includes factual information from the past and judgments about current or future situations that help us anticipate the consequences of acting on our alternatives.
In choosing a car to buy, for example, we would want to know the recent sales price of other similar cars (factual information), whether the car has unknown problems (uncertain current situation), and what the resale value would be in 2 years (uncertain future situation).
The information we base our decisions on should be useful in the sense that it could influence our choice of alternatives. Useful information should come from a credible and unbiased source, be timely, and acknowledge uncertainty. Information about uncertainty, such as the value of the car in 2 years, should recognize the upside and downside risks and their associated probabilities.
Too many decisions are made based on wrong or incomplete information. Consciously considering information needs and gathering useful information before we act is essential to good decision-making.
How to obtain useful information
- What do I wish I knew to make a better decision?
- How might I get it?
- Do I believe the information? Is the source biased?
Ask your head
- What are the potential outcomes of each course of action?
- How likely is each of the outcomes?
- Is it worth getting more information before deciding?
Ask your heart
- Who knows about this topic? Who could help me find out?
- What stops me from getting the information that I wish I had?
Tools and good practice
- Digging for information from good sources – e.g., libraries, newspapers, magazines, internet
- Finding out from people who know
- Networking to find good sources
Traps to avoid
- Laziness or reluctance to find out
- “The things I know that ain’t so” – Yogi Berra
- Wishful thinking
- Assuming the future will be just like the past
- Avoiding uncertainty
- Ignoring things that I don’t understand
- Getting swamped with too much information