55 - Changing uncertainty to a risk range



You’re at the airport. You see a DELAYED against your flight on the display board. What would you think: Should I call and cancel the meeting I’m traveling for OR I’m sure this is nothing?

You’re waiting at home for a technician’s visit. But you only know the four-hour window in which he’ll show up. What thought: I should not dare go for a shower lest I miss the technician OR There’s no way the guy can come just as I’m taking a shower? Your showers are average in duration, by the way.

You’re at the doctor’s. The place is teeming. You wonder how long it would be before your turn. What thought: Maybe I should come back another day OR This will clear up in no time?

What is common to the above situations is that the range of outcomes is known but the probabilities for each individual outcome is unknown. Your flight, the technician’s visit, and the doctor’s consultation may or may not happen soon enough for your day to not be ruined but you don’t know the probabilities of each of the outcomes. This is uncertainty.

Risk is different from uncertainty. Risk means you know the range of outcomes and the probabilities for each. Risk is more palatable than uncertainty.

A small piece of information can change uncertainty to risk. That small piece of information is the base rate–in the examples above, the average delay or wait time.

The problem is that when we face uncertainty, instead of looking for the base rate to ascertain the risk, we are pulled by biases of personality on opposite sides. We are prone to viewing the world in binary: best case or worst case. An optimist ignores uncertainty and assumes zero risk. A pessimist amplifies uncertainty and assumes disaster. https://www.hks.harvard.edu/publications/ignorance-lessons-laboratory-literature

And when our reading of risk in the same situation can fall so widely on a spectrum, our decisions will too.

Uncertainty distorts perception. When faced with it, try and change it to risk. Then you’ll know what your chances are. Sometimes, though, that is not possible and you have to decide without knowing the odds. In such a case, be prepared to be wrong.

Humans hate uncertainty. The best product designers can set themselves apart here. This is not reducing the wait time so much as reducing uncertainty around the wait through smarter information sharing

DELAYED by 60min instead of just DELAYED

A text message 30min before technician visit instead of just a four-hour window

Token system at doctor’s to better guess the wait time

Before you tag an outcome as anything between ‘no way’ and ‘dead sure’, ask if any information missing currently would change your read of the situation? And then try and seek it before you jump into solutioning mode.

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