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Decisions: data, bias and blame

October 28, 2012

This Strata (NY, 2012) talk caught my attention more than any talk at the conference. Ms. Ravich made a request for developers to create better decision tools. (Did she confuse this group for a mythical Software Engineer/Game Theory conference?)

Ms. Ravich started with “I am not a big fan of the information revolution.” That’s a gutsy start given the crowd. But fortunately we were all drowsy, no one reacted. Technically, she was one of the best speakers–she spoke clearly and slowly, her argument was logically organized, she told a good story, and used a powerful myth as a supporting metaphor for her point.

The form of the request was shaped by the idea of fast and slow thinking. Fast thinking at its best synthesizes and sorts quickly. You need fast thinking to sort out what to think slowly about. Then she delivered a couple of assertions. “I think strategic decision makers are in real danger of the information revolution swamping our ability to do fast thinking. And that’s the very attribute we need to do to make the hard policy choices.”

What does “information revolution” mean? Apparently it is a movement or -ism or evolution or situation that can change basic human psychology and erodes the ability to do fast thinking. And what is the case for more fast thinking in policy making? Heuristics for decision making are so natural we barely realize we are using them. They are great because they are fast and we feel certain about them. Also, they can be create huge liabilities when used to make decisions about long-term policy. That feeling of certainty is associated with confirmation bias, attention bias, willful framing naivete, unconscious anchoring biases, …

Ravich goes on to explain the assertions above with an example from the Bush (43) administration dealing with the challenges of nation building in Afghanistan. Afghan was growing a lot (most) of World’s opium poppies. I am sure this caused many economic, border, organized crime, monetary, etc problems. But Ms. Ravich’s explanation for why this was bad was that it offended our national pride. So, we decided to destroy the poppies. This did not endear us with the farmers nor stop them from growing poppies.

Ravich explains that the poor process of making the decision was due to the inability of decision makers to “rack and stack the importance of each bit of information to see how it aligned with our goal.”

Following this explanation was the request: “If strategic decision makers in the situation room are going to win the information revolution, developers need a better insight into the thought process of how the policy decision makers reason and think, how we assemble and prioritize information.”

I am afraid I heard something a little like this… Look, we are good at making gut decisions. We can make them fast. We feel and act confidently about them. But you guys didn’t make the proper context for our heuristics and biases so they didn’t reflect reality. Do better next time.

On one hand, fair enough. That’s the job I signed up for. But it also seems there is room here for more responsible accounting for biases on the part of the decision makers? And that sometimes means wading through boring data and trying to understand something you don’t already understand.


One Comment leave one →
  1. December 25, 2012 3:16 pm

    I am currently reading “Thinking Fast and Slow” and deal with data science and business analytics and decision optimizing processes daily. I think Ms. Ravich makes a good point yet disagree in part. Organizations often lack decision optimizing processes and people often engage in self-deception – I suggest this is a bigger problem.

    Fast thinking is appropriate for certain decisions and slow thinking for others. The art is knowing the difference. More and better data can – in theory – help make better decisions using both fast and slow thinking. The trick is designing and executing decision optimizing processes to get better decisions. And creating check and balance systems to guard against self-deception.

    I suggest many public and private knowledge and decision making processes are flawed with no adequate check against self-deception. See Iraq, Afghanistan and Libya wars. See also financial crisis. In these cases, the private financial heads of state and policy makers had an abundance of data along with best tech and scientists – yet failed to understand the issues to make optimal decisions.

    Strong evidence suggests self-deception blinded our purported best and brightest. Information overload along with fast and slow thinking had little to do with it.


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