Excited, you are on your way to a stunning vacation at the lake’s region of northern Italy. You left the hotel for the center of Milan, the fashion city, for dinner. Which restaurant will you choose? How many restaurants to examine until a decision is made?
We all find ourselves in dilemmas of this kind, from job offers, dating or buying a car. When does the search stop? Is this a mathematical or psychological question?
Let’s start with the rational approach, where a simple number – 37%. Is the answer. I will explain. Set aside half an hour to explore three places, the atmosphere and the menu without making a decision. After that, the next restaurant you like is the most accurate restaurant for you.
The 37% law is valid for making decisions between more than a few potential alternatives. If you have given yourself a month to decide (rent an apartment, a life partner or a car, spend the first ten days impressing and calibrating, free from the need to decide. From the next day, the next appropriate first choice is the optimal choice between excess information and a hasty decision.
But we humans have a hard time making rational decisions (even if we tell ourselves something else). In a decision-making environment between multiple choices, there are two types of types – those who seek the best alternative (the researchers) and those who prefer the good enough alternative (those who are exploiters). One of the distinguishing elements between the types is the perception of risk. The more risk-averse we are, the more prone we are to the type of researcher. A second component is age, as we get older so does our tendency towards the contented type (job, new friends, unfamiliar experiences and more)
What type are you? Answer the following three questions honestly:
– In front of you are two boxes – in the first 90 percent chance of a gift of 75 $. In the second, 50 percent chance of a gift of 150 $, which one will you choose?
– To your hotel at the beginning oy your vacation there are two ways. The first is fast, safe, monotonous views and you are at the hotel within 3 hours. The other is wild, sharp turns, passing through magical rural landscapes, sometimes animals crossing and impeding movement. Arrival time between 3-6 hours. Which way will you choose?
– A gift for your birthday – a dinner with four pairs of familiar friends or a gift voucher for dinner with eight people you have never met?
Whether you are at one end or the other of the answers (or like most of us, somewhere in the middle), try the mathematical solution. Within the time limit you set, devote 37 percent of the time to examining the alternatives and from that moment on, the first suitable alternative is probably the best.
So where do you fly to? The Salzburg land region in Austria, the lakes in northern Italy or discover Albania?
Twice familiar experiences and an unfamiliar one is the recommended formula. Have a good vocation.