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Decision Making|Reading Time: 2 minutes

Daniel Kahneman’s Favorite Approach For Making Better Decisions

Picture this: You’re six months into your company’s ambitious expansion, and what seemed like a sure bet has turned into a nightmare. The market wasn’t just ok—it was poor. You made a big mistake. Your team is demoralized, your board is asking tough questions, and your rainy-day fund is gone.

Now imagine you could have seen all of this before spending a single dollar.

That’s the power of the premortem, a decision-making tool so effective that Nobel Prize winner Daniel Kahneman calls it his most valuable technique.

While pioneered by psychologist Gary Klein, Kahneman’s endorsement speaks volumes—when someone who’s spent decades studying decision-making singles out one method above all others, it is worth paying attention.

Pixar uses this process in their story development to identify plot holes before investing millions in animation.

The simple but powerful process:

Before finalizing any major decision—whether launching a product, making a key hire, or entering a new market—gather your team for a thought experiment.

Split them into two groups. The first group time-travels one year into the future, where the initiative has completely failed: the product flopped, the hire was a disaster, and the market expansion burned millions. The second group envisions remarkable success. Each person writes a detailed story explaining exactly how and why their scenario unfolded.

The only rule is you have to be specific. Instead of vague concerns like “the market wasn’t ready,” you get: “Our sales team spent six months hearing the same feedback—our price point was 40% above what buyers could justify. By the time we adjusted our pricing strategy, three competitors had captured our target customers.”

Harvard professor Max Bazerman shares why a pre-mortem is so effective: “When judging friends’ home renovation projects, most people estimate costs will run 25-50% over budget. But with our own projects, we confidently predict on-time, on-budget completion.” The premortem exploits this psychological distance. By placing ourselves in the future and looking back, we gain the objectivity we naturally have when evaluating others’ plans.

It also solves a crucial team dynamic. As Kahneman notes, “organizations really don’t like pessimists” and often treat skeptics as “almost disloyal.” However, you get more honest feedback when you frame criticism as an intellectual exercise about an imagined future. The conversation shifts from “don’t rock the boat” to “surface potential problems before someone else does.”

Your 5-Step Premortem Checklist:

  1. Schedule a 90-minute session with key stakeholders
  2. Present the decision or initiative clearly
  3. Split the group and assign scenarios (catastrophic failure vs. remarkable success)
  4. Give 20 minutes for individual story writing—push for specific details
  5. Share stories and capture actionable insights, especially overlapping concerns

Management expert Karl Weick explains why this focused approach works better than traditional planning: “It is far easier to imagine the detailed causes of a single outcome than to imagine multiple outcomes.” By deeply exploring one specific future—complete success or total failure—you generate more concrete, actionable insights than from generic contingency planning.

The premortem is that rare business tool that’s both simple to implement and consistently valuable. Before your next major decision, take 90 minutes to run this exercise. The insights might save you from conducting a real postmortem down the road.

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