10 Decision-Making Books for Leaders
This article focuses on decision-making books that we believe every leader should read -or learn more about. Scientific insights from behavioral psychology and neuroscience require leaders to re-think many of their assumptions about how people -including themselves- think, decide, and act. This is particularly important when dealing with high-stakes, complex decision-making.
During our training and consulting projects, many of the professionals we work with ask us for brain and behavior book recommendations. We love these questions as we are avid readers ourselves and we write these articles to share the decision-making books we have recommended most often with you.
Decision-making books for leaders
1. Superforecasting: The Art & Science of Prediction
This book is brilliant and shares the first demonstrably effective way to improve our ability to predict the future. You will follow the story of how Philip Tetlock -a leading scientist- and his team study how people make predictions and how this will help you make better forecasts and decisions. The New York Times called it “The most important book on decision making since Daniel Kahneman’s Thinking, Fast and Slow.”
This book draws on many cognitive biases (systematic thinking patterns) and practical field experiments. Tetlock and his team started the US government-funded Good Judgment Project which took tens of thousands ‘ordinary’ people and asked them to forecast global events. They found a group of superforecasters who consistently outperformed the benchmark, competitors, prediction markets, and amazingly even intelligence agents with access to classified information.
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By observing, analyzing, and comparing the superforecasters with other forecasters, they found a set of principles that demonstrably affect our ability to predict the future. When they taught these principles to a set of ‘normal’ forecasters, they also became significantly better. We believe this decision-making book is an essential read for any leader as it goes beyond just prediction. It will help you think more clearly in all situations.
2. Decision Leadership
The primary goal of leaders is to empower others. Decision Leadership offers a fascinating view in which organizations are decision factories, and their leaders decision architects. Their job is to empower their people with the tools to hone their professional judgment, and make better decisions systematically.
This book is crammed with overarching evidence-based tools, techniques, and frameworks for better decision-making. It builds on decades of real-world cases, and scientific literature like Thinking Fast and Slow, Nudge, and Predictably Irrational.
Decision leadership is essential reading for leaders, but should be on the bookshelf of anyone concerned with the quality of organizational decisions.
3. You’re About to Make a Terrible Mistake
When Daniel Kahneman (author of Thinking Fast and Slow) describes a book as “A masterful introduction to the state of the art in managerial decision-making”, you know you’re in for a treat. Olivier Sibony’s You’re About To Make A Terrible Mistake contains frightening real-world cases of cognitive bias in decision-making in top-tier organizations. It’s impossible not to see de-biasing your decision-making as a top priority after reading this one.
Luckily, this book contains a -if not the- most actionable framework with interventions and techniques for better decision-making in business. The author’s decades of experience as a McKinsey partner, as well as his academic competencies as a HEC professor, shine through in this masterclass in decision-making.
4. Super Thinking: The Big Book of Mental Models
To make sense of the world, your brain creates mental models of ideas and situations. These mental models are essentially a set of frameworks that help you separate good ideas from bad ones and make decisions more effectively. More broadly, they help you better understand how the world works.
These mental models come from many disciplines like psychology, physics, economics, information theory, and are usually obtained through a lifetime of study. The authors of this decision-making book collected over 350 mental models and help you get a basic understanding of each one. It is a very insightful read and helps you explore before you decide which mental models you want to study in-depth to improve your thinking.
To give you a glimpse, some of the mental models discussed are de-risking, overfitting, heuristic, inertia, A/B testing, decision fatigue, parkinson’s law, and the scientific method.
5. The Art of Thinking Clearly
This book is a collection of 99 cognitive biases that science has proven to affect our thinking and decision-making. We highly recommend this book to those of you who want to learn more about biases but do not quite know where to start. This will give you a broad network of biases and afterwards your mind can start puzzling together how some of these relate to each other.
The author does a great job at making the abstract concepts more concrete by telling stories and giving examples. He also points to some of the things you can do to debias your own thinking as you will probably -like us- recognize yourself in may of the examples. You will find nearly all well-known biases in the book and it will undoubtedly help you think more clearly.
Examples of biases in the book are survivorship bias, confirmation bias, overconfidence effect, hindsight bias, action bias, hyperbolic discounting, information bias, salience effect, and curse of knowledge.
You might not have expected us to recommend a book by the entrepreneur behind and Chief Investment Officer of the world’s largest hedge fund, Bridgewater Associates. When this book came out, we were very excited as Ray Dalio managed to explain the concept of principle-based thinking extremely well to the public. If you regularly make important decisions, take the time and read this book.
In this book, he explains the principles that led to his own development and the exceptionally, effective culture of Bridgewater. These are focused on his core idea of creating “an idea meritocracy that strives to achieve meaningful work and meaningful relationships through radical transparency”. Making decisions based on principles allows you to see most new situations as ‘another one of these’.
The book will provide you with powerful principles to follow yourself but like the author, we believe the true value is in creating and optimizing your own set of principles that support your decision-making. There is also a beautiful 30-minute video by Ray Dalio that explains many of these principles.
7. Noise: A Flaw in Human Judgment
This book is written by a few of the biggest names in behavioral science and -like Thinking, Fast and Slow– it’s a tough read but amazingly insightful. The unsurprisingly realist core idea is that our decision-making is not only impacted by bias but also by noise. This means it’s even harder to assess direct cause-and-effect between many of our decisions and the outcome, which in turn makes learning harder.
Noise is at the root of one of the biggest hidden costs known to organizations in the 21st century: Inconsistency in professional judgment and decision-making. Where there is judgment, there is noise, and often a lot more than you think.
Among all this noise and bias, there is hope. This book offers concrete tools to identify and mitigate both noise and bias from organizational judgment and decision-making.
8. Fooled by Randomness
Nassim Taleb is a mathematician, philosopher, and investor many of whose ideas like black swan events and antifragility have become mental models of their own. This book is about how we perceive and deal with luck in business and life and core thesis is that we (subconsciously) tend to attribute to skill what should be attributed to luck.
The author combines his experience in the world of financial trading -a decision-making arena- with philosophical and psychological insights, backed up with mathematical rigor. Reading this will make you more aware of the true influence you have over your own achievements and how to integrate these insights into your life as a person and professional.
9. Algorithms to Live By
This book explains the principles that humans can borrow from computer science to consistently make better decisions. The ‘brain = computer’ metaphor is quite common nowadays and this book focuses on the algorithms we use to make decisions. If you have read Thinking Fast, and Slow or read our article on System 1 & 2 thinking, you can think of these as guidelines for good system 2 decision-making.
The best thinkers combine insights from multiple disciplines and this book is on the interesting intersection of cognitive psychology-technology. This will probably prove an especially relevant read for the more analytical-minded leaders among you as applying the algorithms will come more natural to you.
10. Think Again
This book explores why good leaders make bad decisions. The authors have done in-depth research into bad decisions that could have been prevented by good decision-making and explores how any leader can prevent similar judgment errors. This journey led them to consider how our brain makes decisions.
It explores the stories of how these decisions were made considering many factors including the decision-maker’s history and context, other stakeholders, and communications. They explain how this happened with decision-making processes that involve our pattern recognition and emotional tagging.
We hope you read or listen to some of these books and apply the most important things you learn. We also know, however, that life is busy and sometimes you want to learn while partnering with an expert for better results and a boosted learning journey. Get in touch if you’re interested in collaborating in areas like decision-making, change management, and customer journey.
Also, keep an eye on our Neurofied blog for more book recommendations and articles!
Neurofied is a management consulting and training company specialized in Brain & Behavior. We help teams and organizations design, implement, and optimize their change management, growth strategy, learning & development and much more with insights from behavioral psychology and neuroscience.
Since 2018, we have trained 1500+ professionals and worked with 50+ teams of companies like ABN AMRO, Tesla, Calvin Klein, and Adidas. We are also frequent speakers at universities and conferences.
If you see any opportunities to collaborate, please contact us here.