A632.2.3.RB - Sheena Iyengar: How to Make Choosing Easier_Reyes,Cassandra

We all want customized experiences and products -- but when faced with 700 options, consumers freeze up. With fascinating new research, Sheena Iyengar demonstrates how businesses (and others) can improve the experience of choosing. Identify four of the methodologies Sheena Iyengar suggests as methods of helping us improve our experience in choosing. Discuss the implications of two of these methods in terms of your own decision-making as an individual and a member of an organization. How else can you improve your ability to decide?

 

               In the video “How to make choosing easier “Sheena Iyengar discusses the average number of choices the typical American makes in a day. She informs us that society is faced with an overwhelming amount of choices to make in just one day leading us to experience the "choice overload problem." While discussing the problems that Americans face today, Iyengar also discusses the four methodologies to assist individuals with the improvement of our experience in choosing. The four methods include Cut, Concretization, and Condition to Complexity. Iyengar state that using these methodologies will help Americans in their dailhy fight to make decisions that they will be content with, without feeling the pressures of choice overload.  

            The first methodology Iyengar discusses is cut. She states that cutting out options is better than it may appear. Those who hold businesses are usually worried that their consumers will not have enough options without thinking that they have bee provided with too many. Iyengar informs them that cutting out the products that are not producing the most income will in fact help them to gain more in revenue as Americans tend to make better choices when there is less to choose from.

            The second method Iyengar discusses is Concretization. Iyengar states that in order for people to understand the choices they are making, they also need to understand the consequences that will stem from the choices they will make. In turn people need to feel the consequences that they will experience in a concrete way. When we feel the consequences of choices in a negative way it causes us to want to make better choices. When consequences are felt in a positive way, we usually feel comfortable enough to choose the choices that made those positive changes.

The third method discussed in the video is categorization, as Iyengar states that we can handle more when things are categorized than when they are just provided as choices. It is interesting to see how even when provided with the same amount of magazine choices, we believe that we have more to choose from when they are categorized than when they are not.

Condition to complexity is the fourth method discussed by Iyengar in order to assist with choice overload. Iyengar tells us that we can take in a lot more information than we think we can, we just need to ease into it. The more we allow ourselves to ease into and learn through the choosing process, the more we are willing to stay dedicated to process and its outcomes.

            One example that Iyengar uses was implemented by my manger when trying to teach my team and I on why he made some of the decisions he did. My manager used concretization to teach us that while some of the choices he made for our team and department did not seem the most appealing to us, it was to him as we were unaware of the other options he was provided, and we did not understand the “politics” of the reasoning behind his choices.

After a team meeting where my team and I expressed our concerns of the choices that had been made in regards to our system usage and interaction with prospects, my manager decided to show us how things would be with the choices that had been made for us by someone else. He had us work our prospects in a completely different way; the way that had been originally asked for us to complete our work by other in the organization. The use of our systems and our contact and communication with other departments all of a sudden seemed so complicated and time consuming. We instantly became frustrated and agitated on the processes we were asked to use and after a week of the chaos, we asked for things to return to normal.

My manager laughed at our request and before approving our normal processes, asked us if we understood the consequences of the choices others would have placed upon us. We agreed and thanked him for his determination in making our lives and jobs easier and less stressful and for fighting to make us a more cohesive unit.

The second method Iyengar discusses that has been used and implemented in my personal life is condition to complexity. This year my husband and I decided that we would start looking into buying a house. After looking at pre built homes we thought how cool it would be to have ours built from scratch where we could make all the choices in floor plans to upgrades and everything in between. Once we sat down with a realtor and started discussing our options I was instantly overwhelmed and the thought of building a home from scratch was no longer appealing. I now wanted something that had already been built and was move in ready. My husband and I went back and forth for awhile on the decision we would choose. I finally decided to give building a home another chance.

Once I started to learn about all the different choices and the different effects it would have on my home I then became intrigued on what was worth spending money on and what was not. I instantly began to enjoy making choices as I began to learn and understand the complexities of those choices. While my husband and I have decided to stay put for now in our current home, I believe that once we decide to move we will want to build our home, because even though the process is stressful, we now enjoy having the ability to make choices based on our knowledge of the choices we have.

In conclusion Iyengar’s methods make perfect sense as I can think of many occasions in my life and others that have caused us to feel the effects of choice overload. It is intriguing to learn that with the minimization of choices, concretization, categorization and condition to complexity, our lives can be made simpler and we can all become more comfortable in the final choices that we do make. Without use of any of these methods, I believe that we would live in a world where choice overload would have negative effects in America’s society.

Cassandra R.

 

 

A632.1.4.RB - Multi Stage Decision - Making_Reyes,Cassandra

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?

The Wharton text discusses the gap between how a class of decisions should be made versus the rule of thumb that describes the way they are actually made. Chapter three reflects on the intuitive decisions that people make and how the positive results of those decisions make us prone to become overconfident in other decision making areas. Wharton states that we then over generalize the degree to which good solutions to some problems also offer good solutions to other problems that may not be similar in nature. Wharton also states that when the solutions to our intuitive decisions go bad the errors made during the process are often large in scale leading to negative long term consequences. Chapter three also shows us how to use formulas and probability to determine the outcomes of two decisions at hand. Once the values and probabilities are known, answers are provided using dynamic programming; deriving a solution to a problem by solving it in the form of two stages called backward induction. 

While the text discusses the methods of values and probability I must admit that my decision making process does not reflect that of Richard Bellman’s dynamic programming or backward induction. In fact, to date I can't think of a time, besides balancing finances or using actual mathematical computations, when I used a formula to solve a problem. If I had to choose a method I felt I used to solve problems, I feel as though I almost always used heuristics to make decisions. Heuristics are described as a mental way in providing satisfactory solutions or what some may call mental short cuts. 

In my opinion I feel as though heuristics have provided me with the ability to provide solutions to issues quickly and effectively in many circumstances. However, when more difficult problems come along and difficult decisions need to be made, I have found that while heuristics can be a useful tool in some instances, it will not hold true for all circumstances. One example occurring as we speak is the decision my husband and I are trying to make in buying a home. While heuristics can provide us with the pros and cons of buying a home and the common sense that it will not be the easiest task to endure, choices in the matter of getting a home such as mortgage payments, HOA and CDD fees, interest on the home, landscaping, location and other things, make us see the need to really sit down and calculate the value of buying a home and the probability of success in us being able to financially sustain and maintain one. I feel as though that the formulas, value and probability discussed in Chapter three would help us to make better quality decisions on forward planning.

I believe that using dynamic programming and mathematical computations would definitely improve my decision making skills to some extent however, in my personal opinion I do not find myself using the strategies of decision making discussed in chapter three on problems that I may find simple enough to use heuristics. I will agree however, that there may be some problems I may come across in the future that would just not be solvable by heuristics, and would therefore consider solving the problem via equation, dynamic programming, probability and other methods discussed in Chapter three. I believe that use of these strategies would better assist me to make effective, quality decisions in both a professional environment and in my personal life as well. The impact that these strategies could have on forward planning would most likely be a decrease in myopic decisions and an increase in zooming out and being able to view how my decisions will affect me for the long term. 

In order to apply optimal dynamic decision analysis to predict the future impact of today's decision I would do my best to become less bias and more open to the idea of change and chance. Any hypotheses that I created would be on fact instead of past experiences and future perceptions or anticipations. I would also do my best to ensure that while I am researching and learning new information that I am doing so with an open mind and filtering the information in a way where I can create opinions instead of confirm preexisting ones.

Lastly, while failure of decision making solutions may at times be inevitable, one thing is certain. We must ask ourselves the following four questions in order to ensure that error is kept to a minimum. These four questions include. Am I being myopic? How appropriate is my starting analogy to solve the problem? What are the penalties for making an error? And, what am I learning from the feedback I am receiving? Asking these questions and following these four principles will in turn provide the optimism necessary to make difficult decisions and ensure that our judgment is based as closely as possible upon the analysis of intuitive dynamic decision making.

Cassandra R.