How to Make Better Decisions and Avoid Common Thinking Traps

Lesson 11: How to Make Better Decisions at Work and in Life

Every day, we make decisions — some small, some life-changing.
In this lesson, you’ll learn how to evaluate choices clearly, avoid common mental traps, and make decisions you won’t regret.

Course Outline: Crash Course Business – Soft Skills

This course builds essential soft skills for work, career growth, and professional relationships.

1. INTRODUCTION: Business Soft Skills – Course Overview

2. LESSON 1: Why You Need Trust to Do Business

3. LESSON 2: Defense Against the Dark Arts of Influence

4. LESSON 3: The Secret to Business Writing

5. LESSON 4: How to Speak With Confidence

6. LESSON 5: How to Make a Resume Stand Out

7. LESSON 6: How to Ace the Interview

8. LESSON 7: Prepare to Negotiate Your Salary

9. LESSON 8: How to Become a Better Negotiator

10. LESSON 9: How to Set and Achieve SMART Goals

11. LESSON 10: How to Make Time Management Work for You

12. LESSON 11: How to Make Better Decisions

13. LESSON 12: How to Work Effectively With a Team

14. LESSON 13: How to Handle Conflict

15. LESSON 14: How to Find Your Leadership Style

16. LESSON 15: How to Create a Fair Workplace

17. LESSON 16: The Many Forms of Power

18. LESSON 17: How to Avoid Burnout

Decision-Making Is a Process

Big decisions rarely happen instantly.

Most of us:

• Compare options

• Weigh pros and cons

• Think about future consequences

Every choice involves opportunity cost — choosing one thing means giving up another.

Understand Opportunity Cost

Nothing is truly free.

Examples:

• Watching Netflix means giving up study time

• Choosing one city to live in means not living in another

• Going to college means giving up immediate income

Good decision-making means considering what you’re giving up, not just what you’re gaining.

Beware of Anchoring

Anchoring happens when:

• You judge an option relative to the first option you saw

• Not based on whether it’s actually good or fair

This is why:

• Discounts feel appealing

• First salary offers influence expectations

Always step back and research before deciding.

Avoid Decision Gridlock

Trying to find the perfect choice can be exhausting.

Key reminder:

Perfect is the enemy of good.

Instead of comparing every possible option:

• Narrow choices to 2–3 strong candidates

• Compare those directly

Use Weighted Decision Tools

Helpful tools include:

• Pros and cons lists

• Weighted scorecards, where important priorities get more points

This helps you see whether one major benefit outweighs several smaller drawbacks.

Give Yourself Time — But Not Forever

Avoid snap decisions and endless delays.

Best practice:

• Sleep on important choices

• Take a few days if needed

• Respect deadlines

Get Outside Perspectives

Asking for advice helps prevent confirmation bias, our tendency to only listen to opinions that support what we already want.

Important reminder:

• Advice isn’t validation

• Be open to hearing things you don’t like

Understand Loss Aversion

Losses feel worse than gains feel good.

This can lead to:

• Risk avoidance

• Fear-based decisions

• Overvaluing what we might lose

Try reframing decisions:

• Focus on potential happiness

• Weigh losses and gains realistically

Watch Out for Motivated Blindness

Motivated blindness happens when people:

• Ignore unethical behavior

• Avoid asking questions

• Look the other way because it benefits them

Short-term comfort can lead to long-term damage.

Learn From the Enron Scandal

The Enron collapse is a classic example of motivated blindness.

Key lessons:

• Incentives can encourage unethical behavior

• Silence can enable wrongdoing

• Speaking up has risks — but matters

Ethical decision-making requires asking hard questions, even when it’s uncomfortable.

Don’t Fall for the Sunk Cost Fallacy

The sunk cost fallacy keeps us stuck because we’ve already invested time, money, or effort.

Examples:

• Staying in a bad job

• Finishing a terrible movie

• Continuing a failing project

Instead:

• Focus on future opportunity cost

• Set clear cutoff points

• Be willing to change direction

Beware of the Planning Fallacy

We often underestimate:

• How long tasks will take

• How much resources they require

Even large organizations fall victim to this.

Build in buffers and reassess timelines honestly.

Learn From Outcomes — Carefully

Good outcomes don’t always mean good decisions.
Bad outcomes don’t always mean bad decisions.

Instead of copying success stories blindly:

• Focus on the process

• Analyze what worked and why

• Learn from context, not just results

Key Takeaways

• Decision-making is a process

• Every choice has an opportunity cost

• Avoid anchoring, loss aversion, and sunk cost fallacy

• Narrow options to avoid overload

• Seek diverse perspectives

• Ask ethical questions

• Learn from past decisions thoughtfully

Next time, we’ll talk about working effectively with teams and how to collaborate without endless meetings.

FAQ

1. What is opportunity cost?
It’s the value of the best alternative you give up when making a decision.

2. What is the sunk cost fallacy?
Continuing something only because you’ve already invested in it.

3. How can I make better decisions?
Compare fewer options, ask for outside input, and focus on long-term outcomes.

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