In a world dominated by artificial intelligence and social media, the amazing work of Daniel Kahneman has never been more important. Kahneman, who won the Nobel Prize for economics in 2002, sadly passed away 2 weeks ago.
His book “Thinking Fast and Slow” provides a detailed account of the work that led to Daniel Kahneman’s Nobel Prize, which he conducted with Amos Tversky.
Kahneman’s book delves into the nuances of the human thought process, exploring how people make decisions and are affected by biases. He starts by outlining two distinct systems of thought: System 1, which is fast and automatic, and System 2, which is slower and more deliberate. Throughout the book, he refers back to these systems, highlighting how our intuition is often just the automatic programming of System 1, causing us to make snap decisions based on incomplete information.
Kahneman goes on to explain that even when we believe that we are making rational decisions based on evidence and data, we are still susceptible to biases, heuristics, overconfidence, and our own emotions.
The book had a major impact on the way I approach problem-solving and decision-making. It discusses how our quick thinking and ‘intuitive’ decision-making often stem from System 1, which is prone to biases, heuristics and overconfidence that can be misleading. While it’s not always wrong, we can improve our decision-making by being aware of this and forcing ourselves to slow down and engage System 2. Essentially, we need to build the habit of being conscious of our thinking and decision-making process.He goes on to share that we can use system 2 to reprogram system 1 to make better decisions.
One particular topic that stood out for me was “The Planning Fallacy”, which refers to our tendency to use best-case scenarios to set unrealistic expectations and deadlines. Our System 1 often relies on unrealistic assumptions, but we can improve this by consulting statistics and data from similar cases as well as getting an outside perspective.
I really appreciate the concept of using “yesterday’s weather” to forecast future outcomes, which is a fundamental principle in agile practices. It’s important to recognise that if a team has never completed more than five items in a week, it’s unrealistic to expect them to complete 25 items in three weeks. Additionally, our need for certainty in uncertain situations can exacerbate this issue.
Overall, I highly recommend reading this book by Kahneman if you’re interested in challenging your thinking and gaining new perspectives on decision-making, choosing, biases and all the other things that impact the way we think.