By Barry Schwartz
"Don't people always want more options?"
The Official Dogma
Western Industrial societies believe that the way to maximize the welfare of citizens, is to maximize individual freedom. And the way to maximize freedom is to maximize choice. In other words, more choice equals more freedom equals better welfare. But too many choices cause paralysis rather than liberation. With so many options to choose from, people find it hard to choose at all. Even if we manage to overcome the paralysis and make a choice, we (the people making the choices) end up less satisfied with the result of that choice that we would be if we had fewer options to choose from. The reasons can be rendered down into four specifics…
1. Regret and Anticipated Regret
In today’s world, the options are endless in every industry, in every subsec. With so many options to choose from, you pick one and it’s not perfect, it’s easy to imagine that you could have made a different decision that would have been better. Ever heard of buyer’s remorse? The grass is always greener? This imagined alternative induces you to regret the decision you made and this regret subtracts from the overall satisfaction you get out of the decision you made even if the one you chose was an objectively good decision. The more options there are, the easier it is to regret anything at all that is disappointing about the option you chose.
2. Opportunity Cost
When an option is chosen from alternatives, the opportunity cost is the "cost" incurred by not enjoying the benefits associated with the best alternative choice. It is the loss of potential gain from other alternatives when one alternative is chosen. Basically, when you choose to do or have something, you are also simultaneously choosing not to do or have something else. Opportunity Cost subtracts from the satisfaction we get out of what we choose, even when what we choose is terrific. Again...when you are choosing to do one thing, you are choosing to not do other things.
3. Escalation of Expectations
With all the options available, your expectations about how good your options should be inevitably go up. When you have more options, you perceive that one must be perfect or at least have the ability to be perfect. And perfect is about impossible in any capacity, a useless gesture. So when you get good but not perfect, you compare what you got versus what you expected and what got was disappointing in comparison to what you expected. Adding options to people’s lives can’t help but increase the expectations people have about how good options will be; producing less satisfaction even when the results of your decision is still good.
“I remember when I was young.” Older generations always seem to love to tell younger generations about how things used to be better, about the good old days. But maybe they’re right. Maybe everything was better back when everything was worse? Back when there were less options, it was actually possible to be pleasantly surprised. In modern day, with perfection as the expectation, the best you can hope for is that something is as good as you expected it to be. You will never be pleasantly surprised.
A consequence of choosing a bad option when there are so few is that when you are dissatisfied and you ask why? Who is responsible? The answer is clear. The world is responsible. When there are hundreds of options and you choose one that is disappointing and you ask why? Who is responsible? It is equally clear that the answer to the question is you. You could have and perhaps should have done better with so many options. There is no excuse for failure with so many options. The weight of the decision is on you. You are at fault. There is no one else to blame.
When it comes to business, money follows the path of least resistance. Some if you have too many options within even your own business, maybe it would be a good idea to get rid of a few. Here is the video that this blog post was based off of below. Barry is a great mix of dry humor and insightful knowledge.