The Trap of Instant Gratification
Decision Making
The human mind makes over 35,000 decisions every day. From choosing where your team should go for lunch to how to budget for Q3 and Q4, we are confronted with decisions all the time.
As humans, we fancy ourselves as rational, self-determined beings, always in control and making the right choices for ourselves. Unfortunately, we often fall prey to several shortcuts that affect our ability to think and decide rationally, especially when time is limited and resources are tight.
In this blog series, we’ll be unpacking the various biases that can lead to poor decision making, while giving you practical, behavioral science tips to help you course correct and mitigate negative business outcomes.
We begin this series with one of the most common decision making pitfalls: temporal discounting.
Temporal discounting¹.
This is the idea that we tend to favour rewards that happen sooner, no matter what—even if they’re smaller than a reward in the future.
The immediacy of a reward (or punishment) is a powerful driver of behavior; immediacy can even override objective value. When in a pinch, we may perceive decisions with short-term results, like creating a sales spike with a buy-one-get-one-free promotion, office upgrades, or holiday bonuses, over those with long-term benefits, like employee training or culture building.
Decision timelines matter.
Humans are myopic decision makers², meaning we are naturally short-sighted. We are biased towards focusing on the present and we’re not great at imagining future consequences (let alone thinking in terms of probabilities). On top of that, we’re impatient and we especially hate delaying our gratification because doing so introduces an element of uncertainty³—and risk. We want our satisfaction guaranteed.
Temporal discounting can hurt.
This can be problematic in a business context. Most good things take time. It might seem daunting to spend time, money, and resources on things like boosting team morale when you can’t be sure when or if things will improve. Or if you’re trying to motivate your employees to adopt a new technology, but the benefits of this change are months away and the road to get there is challenging. Your team may not be able to clearly see the value or the reward of this process and so they might lose motivation or give up altogether.
Falling into the trap of temporal discounting and choosing the immediate may mean you’ll miss out on the good and necessary things that require long-term investment.
Avoiding the trap.
As a leader, having all these decisions to make is overwhelming enough; there’s no time to consider all of these psychological nuances. We know, we can help.
Ways to overcome temporal discounting:
Dangle more carrots along the way—we are motivated by rewards that happen sooner, especially if the journey to a larger reward is a long one
Highlight how change will benefit your employees’ immediate lives⁴ (e.g., a more streamlined workflow, less time spent on menial tasks, more business successes)
Point out negative consequences that are immediately avoided by making a change (e.g., lag time, decreased productivity, having outdated tech)
Decisions need to be made whether we like it or not. Knowing what you’re up against means that you’ll have a better chance of making those choices count.
Stay tuned for our next blog post where we’ll unpack the paradox of choice. See you then!
Improving decision making and other behavioral aspects in the workplace environment is where Debut’s expertise lies. We’ve been helping clients navigate these complexities towards better engagement since 1997. Let us know if we can help!
References
Chapman, G. B. (1996). Temporal discounting and utility for health and money. Journal of Experimental Psychology: Learning, Memory, and Cognition, 22(3), 771.
Gabaix, X., & Laibson, D. (2017). Myopia and discounting (No. w23254). National bureau of economic research.
Reynolds, B., & Schiffbauer, R. (2005). Delay of gratification and delay discounting: A unifying feedback model of delay-related impulsive behavior. The Psychological Record, 55, 439-460.
Rung, J. M., & Madden, G. J. (2018). Experimental reductions of delay discounting and impulsive choice: A systematic review and meta-analysis. Journal of experimental psychology: general, 147(9), 1349.
