Emotions impact decision making

When it comes to making critical business decisions should we keep our emotions out of it?

In our every day language we often talk about ‘gut feelings’, and “What does your heart tell you?”. We often see our hearts in conflict with our heads when it comes to decision making. On the one hand we can be objective, calculating, and free of emotion. On the other hand we simply act according to what we feel is right. Today I want to invite you to consider that these two modes of thinking - what Daniel Kahneman calls thinking fast and thinking slow, don’t have to be in conflict with each other. An emotionally intelligent person knows when to think fast and when to think slow.

As human beings we have a limited capacity to perceive and understand what is going on around us. We can only manage between 5 and 9 chunks of information at a single point in time (with some researchers estimating this number to be closer to 4). If you’re taking someone’s phone number, they would often give it to you in chunks of 3-4 numbers at a time. This is because we intuitively know that to ramble off the entire number to someone doesn’t work. They would forget it instantly and ask you to repeat it. There is much more going on around you that you could possibly pay attention to - how is it that we are not constantly overwhelmed by all this information? Answer: Emotions.

Our emotions are literally like a sixth sense. They do not provide a direct representation of our surroundings, but they do represent a complex encoding of information based on all of our previous experiences and natural dispositions. This happens unconsciously and lightning fast. So if I walk into a dark alley, I might suddenly feel a strong sense of fear, but I wouldn’t necessarily know why. In this situation my brain has subconsciously taken many queues from the environment (too many to be consciously aware of), compared it to my past experiences, and produced a feeling that will instantly grab my attention, and offer me the chance to make a decision to modify my behaviour. Our emotions are easy to comprehend and they contain tons of information, which allow us to function in an incredibly complex environment.

But, here’s the rub...our emotions offer information on large amounts of data in an instant, but the information isn’t always accurate. This is where our rational mind needs to come in and analyse whether our feelings, and behaviour are really serving us or not.

You cannot separate these functions. Without emotion, our rational mind lacks information and energy. Brain damaged patients who cannot generate certain emotions, often become completely inactive. Without reason, we become impulsive, only living for emotional gratification in the present. There are no decisions where emotion doesn’t play at least some part in influencing the outcome.
I will end off with a story to illustrate how this dynamic can play out.

In 2010 a group of Israeli researchers decided to test our capacity for rational decision making. The unwitting participants in the study were eight parole judges in Israel. A group that is supposed to apply clear and logical rules and procedures to determine whether parole is granted, or not. These judges spend entire days reviewing applications for parole - 6 minutes per case on average. According to the researchers the default decision is denial of parole. Only 35% of requests were approved on average. They recorded the exact time of each decision made, and the times of the judges’ three food breaks— morning break, lunch, and afternoon break. The researchers then plotted the proportion of approved requests against the time since the last food break. Directly after each meal about 65% of requests are granted. During the two hours or so until the judges’ next feeding, the approval rate drops steadily, to about zero just before the meal. (Kahneman, 2011)

This is a sobering result, but it is not to say that we are bad at making decisions. In order to make good decisions we need to be self-aware and manage ourselves - in short: develop our emotional intelligence.
References: Kahneman, D. (2011). Thinking, Fast and Slow. Penguin Books.

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