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Risk instinct and decision making: Deciding our way through life

  • ‘Decide to survive’ is a basic principle of evolution and every living entity must engage in decision making in order to live.
  • Emotion vs Cognition dualism refers to the concept that we each host an internal debate between the ancient ‘gut feelings’ and the more recently acquired ability to think and reason.
  • Psychological Consultancy Ltd (PCL) has developed a methodology that provides valuable insight into how individuals, teams, and organisations make decisions.
  • By using the Risk Type Compass (RTC) model, companies can cultivate a resilient, open, and mutually respectful climate.

Decision making, the process by which choices are made, is absolutely fundamental to survival. Everything that lives must make decisions, including the very simplest of life forms. Single cells sense the paucity of nutrients and react, white blood cells sense bacteria and devour them, and cotton plants manage to keep leaf temperatures optimal whether in sunlight or in shade.

‘Decide to Survive’ is the basic challenge of evolution.

We make thousands of decisions each day, many of which will not be conscious. Unconscious decision making reflects an evolutionary heritage that we share with all other living beings. But what drives decision making in humans? And how does this impact team and organisational decision making? This is the question that the team at Psychological Consultancy Ltd (PCL) has been working on.

Turning point for Homo sapiens

Although we are now capable of ‘conscious thought’, we were all at one time ‘unconscious deciders’ and we still rely crucially on those inherited pre-conscious elements of decision making. They determine our heart rate, body temperature, sugar levels, and immune responses, just as they have since our earliest pre-language ancestors.

However, the turning point for Homo sapiens came in the development of a completely unprecedented language capability. Combined with a capacity for symbolic thinking and a new-found state of self-awareness, we became conscious decision makers – a highly significant turning point for our species.

Our language-based cognitive awakening added logic, reason, objectivity, and the power of analogy and metaphor to our thought processes; an ‘upgrade’ in decision-making power that was truly transformational. It became a basis for writing, scientific enquiry, mathematics, and a dramatically enhanced capacity for communication, sharing and collaboration.

Emotion vs Cognition dualism

Humanity is now equipped with an articulate mind space the team call ‘voices of the mind’, that are in constant dialogue. We each host an internal debate between the ancient ‘gut feelings’ that are spontaneous, reactive and immediate, and the recently acquired, linguistically mediated, thinking and symbolic reasoning.

Understanding the complexities of people and their individual differences has been a major theme of psychological theory and research.

This Emotion vs Cognition dualism, in one guise or another, has fascinated the most enquiring minds in our history; from Plato, Descartes, Hume, and a string of other philosophers, through to today’s researchers in behavioural economics, neuroscience, psychology, anthropology, and economics.

Figure 1 The Risk Type Compass (RTC) model.

Each recognises these dual systems but characterises them in different ways, including ‘System 1 vs System 2’ (Stanovich & West, 2000), ‘Fast vs Slow’ (Kahneman, 2011), and ‘Go vs Know’ (Metcalf & Mischel, 1999), all of which is testament to the breadth of interest in, and significance of, an approach that merges instincts and the complexities of thought in a mind space.

The complexities of people

Understanding the complexities of people and their individual differences has been a major theme of psychological theory and research. And, within the context of teams and organisations, the pre-eminence of decision making places that centre stage.

Figure 2 Risk Type compass scales.       Figure 3 Risk Types.        Figure 4 Decision-making styles.

Researchers ask: What is the relationship between the diversity of people and their impact on the decisions they make? How are the decisions made by teams, groups, committees or boardrooms influenced by the risk dispositions of those taking part? In large organisations, how can we create a coherent picture of the complex decision-making dynamics that permeate their sprawling structures?

Exploring evolutionary psychology

All human characteristics vary naturally throughout the population. Variations in decision-making styles reflect innumerable possible combinations of emotion and cognition. Both have their own evolutionary history and are managed independently within the brain by different neural networks.

Figure 5 Risk Types within an organisation.
Discover your Risk Type here: www.psychological-consultancy.com/research-features-access-information

PCL is a collective of leading business psychologists delivering psychological assessment and consultancy services, helping businesses to harness the potential of their talent pool. During ten years of research into decision-making processes of individuals, teams, and organisations, PCL has developed a taxonomy of ‘Risk Types’ within a methodology that models the dualist structure of decision making.

The Risk Type Compass (RTC) Model

The RTC model uses highly reliable questionnaire measures for each of the two dominant influences in a person’s mental life: Emotion – their feelings and Cognition – their thought processes (Figure 1). The additional vertical and horizontal axes (Figure 2) account for those that are high or low on both scales.

The orthogonality of those two scales

(r= 0.007) supports the incremented 360o circumplex spectrum of risk dispositions. As a basis for interpretation and communication, this is segmented into eight distinctive ‘Risk Types’ and the population as a whole is very evenly distributed between them.

How much risk any individual is comfortable with – the boundaries between what, for them, is too reckless and what is too passive, are aptly described as instinctive. These distinctive ‘fight or flight’ features are prominent throughout nature. As we stray outside our comfort zone boundaries, ‘gut feelings’ of anxiety or apprehension increase levels of discomfort and distress, forcing the decisions we make and the actions we take.

Modern decision making

Today’s decision-making environment is increasingly complex. Information, opinion, and the rate of change fuel discourse and the formalisation of decision making in large societies via our socio-political structures and institutions. High-level group decision making is prevalent throughout society, within professional bodies, government committees, public services, and much more. It is used in everything from team sports to animal tracking in Kruger’s National Park.

Whatever the context, group decision making is most effective when the issues under discussion are dissected, pulled apart, stress tested, and argued out from a variety of different perspectives. In this context, the exceptional diversity of risk instincts within our species has been a major factor in terms of success and survival. Nature hedges its bets through diversity, keeping many options open on a ‘may the best one win’ basis. Exchanges of viewpoint ensure healthy debate and a challenge to dogma, rigid-mindedness, and susceptibility to groupthink.

Decisions in business

In a business context, the significance of risk and decision making is consequential in many different ways. The complexity of interpersonal dynamics and variety of personal risk dispositions within an organisation will contribute to a turbulent mix of perceptions and opinions. Formal decision making, whether boardrooms, C-Suites, departmental managers, or shop floor representation will involve group decision making. The ‘risk instincts’ of those around the table will determine outcomes: the scale of ambition, degree of innovation, agility, the financial risks implied, timetables and a lot more. Any or all of these may, or may not be, well researched, detailed or costed.

The RTC offers insight into the decision making at different organisational levels. The ‘Risk Landscape’ takes us beyond individuals and teams to the mapping of decision-making styles across divisions or sections of large organisations. Its visual display invites exploration and interrogation: Is the organisation predominantly risk-taking or risk-averse? In detail, which sections, divisions, and functions are the most risk-taking and which are most risk-averse? How do these different dynamics relate to team performance and effectiveness?

Shaping business culture

The pragmatic message on organisational culture from the industrial-organisational psychologist Benjamin Schneider (1990) has been ‘The people make the place’. The ‘Risk Landscape’ provides an interrogatable digital ‘heat map’ of risk dispositions, graphically depicting the risk culture; a ‘birds eye’ scrutiny helping organisations to formulate questions, to plan interventions, assistance, change, or team development.

The Risk Type Compass (RTC) Model is a methodology that provides valuable insight into highly significant decision-making processes.

It exposes Risk Type balance that is counterintuitive (a predominantly risk-taking finance department or a risk-averse sales team, for instance), or where a lack of diversity might increase vulnerability to groupthink or resistance to change, or where balance might be improved by staff transfers or reorganisation – and putting all this onto a measurable and objective basis. Equipped with these insights, proactive measures can shape a culture of mature decision makers that are open, mutually respectful, and informed.

Discover your Risk Type here: www.psychological-consultancy.com/research-features-access-information

How can we as humans optimise our decision-making abilities?

As an individual:
• First: Be clear about your own ‘risk instincts’, their benefits and limitations.
• Second: Build confidence by increments, practice and consolidate to achieve ‘second nature’ fluency.
• Third: Be aware that ‘basic instincts’ may short-circuit and disrupt progress into unfamiliar territory.
• Fourth: Remember instincts are intuitive, ‘second nature’ is language based – you ‘instructing’ instinct.

Within a group:
• First: Understand the upper and lower boundaries of your own ‘comfort zone’.
• Second: Appreciate the Risk Types of other group members.
• Third: Speak up openly and candidly to represent your own viewpoint, however daunting the consensus.

How do the complexities of the modern world impact how we make decisions?

Rapidity of technological and cultural change, complexity, waves of passing enthusiasms, instability.

How can the RTC model positively impact an organisation’s bottom line?

Maximising effective decisions. Risk taking, innovating, maximising Risk Type diversity, support psychological safety. Ameliorating and managing resistance to change.

Is there an optimal mix of Risk Types that organisations should aim to create within teams?

Yes, but you have to find the balance. Ideally, teams need performance coaching. As in sports, learn to use available talents to best effect. Manage ‘organic change’ by identifying allies, modelling ‘centres of influence’ and investing in the necessary risk management talent.

Related posts.

Further reading

Risk Type Compass: navigating the dynamics of successful decision making [online] Psychological Consultancy. Available at: www.psychological-consultancy.com/risk-type-compass/ [Accessed 16.09.24]


• Jaynes, J, (1983) Consciousness and the voices of the mind [online] Julian Jaynes. Available at: www.julianjaynes.org/­pdf/­jaynes_consciousness-voices-mind.pdf [accessed 16.09.24]


• Mazarr, MJ, (2016) Rethinking risk in national security. Palgrave Macmillan. Available at: doi.org/10.1007/978-1-349-91843-0 [accessed 16.09.24]

Geoff Trickey

Geoff is a Chartered Psychologist with a BSc in psychology and an MSc in educational psychology from UCL. He is a former Honorary Research Fellow at UCL, a Fellow of the Royal Society of Arts, and an Associate Fellow of the British Psychological Society. Geoff founded PCL in 1992, overseeing its growth to an established global presence.

Contact Details

e: [email protected]
w: www.psychological-consultancy.com/risk-type-compass

Competing interest statement

Geoff Trickey is CEO of Psychological Consultancy Ltd and creator of the Risk Type Compass.

Cite this Article

Trickey, G, (2024) Risk instinct and decision making: Deciding our way through life,
Research Features, 155.
DOI:
10.26904/RF-155-7681433418

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(CC BY-NC-ND 4.0) This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License. Creative Commons License

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