I’ve been very interested and curious for a long time about the hows and whys behind the human decision-making process. As my post on fear and following the pack suggests, I’m a firm believer that certain innate, biological impulses drive us in certain directions, sometimes against what should be our better judgment. I never cease to be amazed at how stupid we can be, even in the face of compelling evidence to act contrary to our biological impulses.
I’ve come up with a shorthand phrase to describe the decision-making process I believe most humans go through when making behavioral decisions: feel, act, then think. It explains a lot about human behavior in just a few short words. Our biology tells us we need to act in order to satisfy our physical needs. We eat when we’re hungry, we flee when we’re threatened, we mate when we feel….you get the point. It’s usually only after we act that we stop to think about the consequences of what just happened.
Let’s change this biologically driven decision-making model on its head. Think, act, then feel. There is no doubt that following this methodology of decision-making is difficult. It stretches our capabilities beyond what we are biologically engineered to do on a day to day basis. The really strange outcome of such a process, however, is that “bad” behavior, particularly bad investment behavior, could disappear from our lives.
Of course there are always circumstances beyond our control, even when we think before acting. It also goes without saying that this approach is also not a guarantee of “good” results, particularly if there isn’t any objective, quantifiable data to analyze in advance of our actions. But what this approach does produce, at least in theory, is “good” behavior.
Behavior that is thoughtful, articulated, reasoned and applied into actions invariably leads to better results when compared to the feel, act, then think approach. It also results in feeling better, long term, about ourselves and our actions. And that, in and of itself, is the driving force behind Behavior Gap. Better behavior, more thoughtful, reasoned behavior, will invariably lead to a more satisfying feeling or result. It helps, of course, that the numbers don’t lie!