Friday, May 8, 2015

When intuition based decisions are successful?

There is a growing excitement over intuitive decision making. This is due to some populist books, for example Malcolm Gladwell (2007)[i] Blink: The Power of Thinking Without Thinking”, and the appealing thought of saving the effort of thinking and still doing the right choices. I found this idea rather implausible, but still there is some truth in it. The more I read the more interested I became of the intuitive decision-making. Summarizing it roughly, I argue that there are three kinds of successful intuitive decisions – those based on luck, expertise and emotion. Expertise and emotion are discussed in the following.

Academic researchers have contributed to this field of intuitive decision making, even though they do not usually talk about intuition, but “Naturalistic decision making approach (NDMA)” or “Recognition primed decision strategy (RPD)”.

Intuitive decision based on expertise


According to Kahneman & Klein (2009)[i] Naturalistic Decision Making Approach (NDMA) is based on the expert’s intuition. The approach was inspired by DeGroot’s (1978)[ii] work on successful chess payers. He used a “thinking aloud” method and noticed that the chess grand masters were able to identify the most promising moves rapidly, while mediocre chess players did not sometimes even consider the best moves. Some years later Klein, Calderwood, and Clinton-Cirocco (1986)[iii] analyzed and described the decision making of fireground commanders, who need to make important decisions under conditions of uncertainty and severe time pressure. Their hypothesis was that commanders would analysis a pair of options, but this hypothesis proved to be incorrect. The commanders were found to consider only a single option, and that was usually all they needed. The option popped up from their experiences and expertise. If they felt the option was inadequate, they modified it. If the modification could not be done, they rejected the option and turned their attention to next alternative.

From these findings Gary Klein (1998)[iv])developed the Recognition-primed decision (RPD) model. In RPD the decision maker thinks about possible actions in given situations, and selects the first suitable course of action.. There are three different types of RPD as illustrated in a figure below. The experienced decision makers are able to recognize when situation is known or similar to some other ones they have experienced or heard of. Furthermore, the experienced decision maker is able to judge which known options to use in a known situation and evaluate which known options are best in an unknown situation. If known options are not available, they can develop new ones.  The challenges of RPD are the need for extensive experience among decision-makers and the identification of situations and actions as known or unknown. The fourth obvious possible situation is missing from the figure 18 of RPD types, namely unknown situation and unknown options.


Even the experience does not give direct answers in these situations and some other method of deciding than RPD is thus used. RPD has later been tested on nurses, system design, military command and control, management of offshore oil installations and stock dealers (see a review in Klein (1998)[i]). RPD has proved to function well in conditions of time pressure, and in which information is partial and goals poorly defined.

Intuitive decisions based on emotions


Even though both NDMA and RPD stress the importance of expertise in order to make accurate choices, it does not stop the Joneses using intuitive decision making. People think they have made an intuitive decision, when they have chosen without conscious deliberation. I think that the most of the “intuitive” choices consumers think they have made, have in fact been heuristic. For example someone can call a decision intuitive; when actually it have been based on the fact that one likes certain option more than others. This phenomenon has been called affect heuristic or like heuristic (Slovic et al. (2002)[ii]). Our emotions provide immediate and automatic evaluation on “goodness” or “badness” of a feature or possible consequence (Slovic et al. (2007)[iii]). People especially rely on their emotions when the decision is difficult, when there is limited amount of information or when they feel the emotions are relevant (Schwarz (2002)[iv]). Even though emotions are rapid, and in many cases accurate, the downside is context dependency and the fact that emotions are easily manipulated (Slovic et al. (2002)[v], Shane (2002)[vi]).

Consumer’s self evaluation of intuitive decision making


I have done several studies[vii] about consumer’s decision- making methods. According to their self evaluation, it seems that intuitive methods (or near intuitive) are used in non-significant daily choices clearly more than more difficult voting choices. In the figure below the intuitive or nearly intuitive methods are in red and deliberate methods in blue. Habitual choices and satisficing (choosing the good-enough option) are nearly intuitive. The deliberation method can be seen as quite opposite method for intuitive decision- making.




From marketer’s point of view the three different ways consumers make intuitive choices (luck, emotion and expertise) are quite different. One can raise the opportunities for luck by good availability and being a top-of-mid brand. Most advertisements and commercials are already appealing to our emotional side. The idea here is that if consumers like the commercial they also like the product. Consumer expertise can be increased by experiences and information. Try in periods and usage situations related advertising addresses this dimension.

So when are the intuitive decisions successful?


The intuitive decisions based on expertise tend to be good. Most emotion-based intuitive decisions are excellent. The rate depends or recognition of the emotion and its source.




[i] Klein, G. (1998). Sources of power: How people make decisions. Cambridge, MA: MIT Press.
[ii] Slovic, Paul & Finucane, Melissa & Peters, Ellen & Macgregor, Donald G. (2002): ”The affect heuristic”, a chapter in book edited by Gilovich, Thomas & Griffin, Dale & Kahneman, Daniel:  “Heuristics and biases: The psychology of intuitive judgment”, p. 397-420

[iii] Slovic, P., Finucane, M. L., Peters, E., & MacGregor, D. G. (2007). The affect heuristic. European Journal of Operational Research, 177(3), 1333-1352.

[iv] Schwarz, Norbert (2002): ”Feeling as information: Moods influence judgements and processing styrategies”, a chapter in book edited by Gilovich, Thomas & Griffin, Dale & Kahneman, Daniel:  “Heuristics and biases: The psychology of intuitive judgment”, p. 534- 547

[v] Slovic, Paul & Finucane, Melissa & Peters, Ellen & Macgregor, Donald G. (2002): ”The affect heuristic”, a chapter in book edited by Gilovich, Thomas & Griffin, Dale & Kahneman, Daniel:  “Heuristics and biases: The psychology of intuitive judgment”, p. 397-420

[vi] Shane, Frederick (2002): "Automated choice heuristics", a chapter in book edited by Gilovich, Thomas & Griffin, Dale & Kahneman, Daniel:  “Heuristics and biases: The psychology of intuitive judgment”, p. 548-558

[vii] Consumer’s media choice –study 2014, Voter’s choice in European Parliament elections 2014, Voter’s choice in Finland’s Parliament elections 2015.


[i] Kahneman, D. & Klein, G. (2009): “Conditions for Intuitive Expertise: A Failure to Disagree”, American Psychologist ,64(6),p.515-526, Sep 2009

[ii] deGroot, A. D. (1978). Thought and choice in chess. The Hague: Mouton.

[iii] Klein, G. A., Calderwood, R., & Clinton-Cirocco, A. (1986). Rapid decision making on the fireground. In Proceedings of the Human Factors and Ergonomics Society 30th Annual Meeting (Vol. 1, pp. 576-580). Norwood, NJ: Ablex.
[iv] Klein, Gary A. (1998). Sources of power: How people make decisions. Cambridge, MA: MIT Press, pp. 1-30.







[i] Gladwell, Malcolm (2007): “Blink: The Power of Thinking Without Thinking”

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