Noise

By Daniel Kahnemnan

Overview

We often like to think that decision-makers use sound, rational judgment when making decisions. Using examples from the courtroom, Human Resources, insurance adjusters, and others, Kahneman and team show that, in fact, our judgments are strongly, and unconsciously, affected by a multitude of seemingly irrelevant factors such as the weather, how hunger the decision-maker is, and even whether the local sports team won their game over the prior weekend. These are what he terms Noise. He differentiates noise from bias and notes that both can, and frequently do, coexist.

If you’re familiar with any of Kahneman’s other work such as Thinking, Fast and Slow , the concepts presented in this book will be familiar to you and many of the conclusions are the same.

The book does present the flaws in human judgment in interesting ways and provides suggestions on how to minimize the effects of those flaws. As Kahneman notes, it not possible to completely eliminate errors, noting that even he falls victim to such errors.

What I Liked About the Book

• Presents good information in clear ways
• Reminds the reader that there is only an illusion of fairness in many judgments
• Reminds the reader that two ’experts’ given the same information may come to very different conclusions
• Provides many examples to aid in understanding the concepts
• Provides suggestions for mitigating the flaws in judgment.

What I Didn’t Like About the Book

• I think the biggest con for this book is that it feels a bit repetitious. This may be because I’m already familiar with Kahneman’s work, but the book feels a bit longer than it needed to be to achieve the same outcome

Do I Recommend the Book?

The book does provide some good insight into why judgments can vary from person-to-person when given the same information. Any time I can learn more about the flaws in how we think and make decisions, I’m for it. While this book focuses on the flaws in judgment and explains how those seemingly irrelevant factors may contribute to those flaws, it is an extension of his earlier work on thinking and decision-making. If you’ve not already read Thinking, Fast and Slow I would recommend that you read that book first so that you have a fuller understanding when he references concepts such as System I or System II thinking.