If decision-making favours our present, how can we protect our future?
This article reveals why short-term decision-making underpins the slow erosion of society and might become your business’ greatest downfall. Read on for 7 solutions to inform a brighter tomorrow.
When making critical decisions, we humans naturally favour present certainty over future uncertainty. Though, preferencing the near-term acts in detriment to mid and long-term outcomes. Examples are omnipresent, though include the fad and flop of zero-based budgeting and the subprime mortgage crisis.
Predicting the future
In his landmark 20-year study and subsequent book ‘Super Forecasting’, Philip Tetlock reveals just how bad experts are at predicting the future: marginally more accurate than laypeople using random guesswork. This lack of accuracy highlights the relationship between perceived / known risk and perceived / unknown reward.
A further problem exists, in that we tend to be guided by our past and present experiences, rather than by metaphysical concepts of a distant world. The future is largely beyond our realm of perception and confronts the boundaries of human capability; our physiology; neurology; psychology; and social structures.
We do not have access to sufficient data. There are too many variables. Our senses are biologically limited. We’re subject to the frailty of our emotions. To ego. To bias. The placement of our self and our perception, in absence of broader perspectives. And to an over-reliance on the past as a precursor to the future. Furthermore, it is hard to predict something we have not yet imagined. Or that follows a strange and non-linear pathway.
To put things into context, the human eye can only see 0.0035% of the reality that surrounds us. Depending on the study and person, our working memory is thought to be limited to between 3 and 9 items, meaning the future requires more complex processes to tackle coherently.
Added to that, we need to deal with a bunch of other humans, without the time to fully understand their own unique abilities and perspectives. Yet alone align them all in a form other than the blandest of compromises.
Prioritising the present
We exist in a culture of high demands and quick wins, tackling the biggest issues that matter now, as and when they are presented.
More often than not, decisions are hierarchical. Targets are set ‘from above’ to drive and deliver short-term goals. Though, few paths exist for those at the bottom of a hierarchy to challenge decisions at the top, despite often superior knowledge as to how decisions might affect them. Long-term decisions preference those with resources to spare, so those with fewer resources may preference the surety short-termism offers.
Our present reality instinctively feels a lot more comfortable:
For one, it costs less and consumes less energy.
We have limited resources and want to protect them by minimising risk.
Our short-term reward systems are aligned.
And there appears to be less to worry about.
Or is there?
Our collective failure to protect future ‘nows’ defines our human struggle.
Imagine…if uncertainty exists in every ‘now’, we will always prioritise the present.
As anyone who’s had a hangover may attest, prioritising today over tomorrow, will most likely result in a tougher tomorrow.
Urgency gathers pace the next day and forces compromises elsewhere.
But what if the fun lasted a month and the hangover a year? At what point do we value tomorrow over today? And with what degree of certainty?
The fact is, the more we prioritise today over tomorrow, the harder tomorrow becomes.
This is our defining paradox.
To describe it, take (almost) any noun and add the word ‘crisis’:
The cost of living crisis
The NHS crisis
The pothole crisis
The Special Educational Needs and Disabilities (SEND) crisis
The school buildings / RAAC concrete crisis
The social care crisis
The housing crisis
The welfare crisis
Etc.
Each of these societal crises are significantly worsening our present lived reality. However, their fate was determined in another now, many years ago. In almost all cases, there was a failing of human prediction, alongside bias for the near-term, rooted in pressures and reward systems at the time.
Were these crises preventable? In theory, absolutely! However, only if organisational culture supported an alternative.
Rather than blaming individual decisions, we must seek to address and adapt the contexts in which they are made.
Knowing this, we can:
1. Mitigate our known inability to predict the future by:
- Taking bold steps to address known knowns, irrespective of unknown small print (apply the 80 / 20 rule…or 70 / 30 perhaps)
- Replacing perception (thinking outward) with perspective (thinking from different angles)
- Building diverse teams, not just due to DE&I policy, but because diverse thinking is critical to balanced decision-making
2. Embrace failure as a fundamental component of learning and betterment in an uncertain world. And, take risks now to de-risk future nows
3. Re-introduce long-term strategic planning, alongside a long-term audit of operational pressures and ‘tipping points’
4. Ensure strategic planning documents are pragmatic, well-used / don’t gather dust, are dynamic and are well-aligned to KPIs
5. Review short-term bias in our organisational reward systems and re-balance with longer-term outcomes (and progress milestones)
6. Acknowledge, folks who are great at short-term planning are not necessarily great at long-term planning. They might be…but, they are probably not! More so, different problems require different mindsets. One size does not fit all
7. Adapt our recruitment processes. During c.25 years in Marketing, I have not once been asked about my personal values, worldview, or thinking style in interview
Without bold decisions, diverse thinking and a measured approach to risk, steady decline is inevitable.
As the saying goes, “The best time to act on this was decades ago.
The second-best time is now.”
