<b>RISKFACTOR:</b> Don’t overreach
Think of the following statements — “No matter what I do, I have the highest standards for myself.” “I never settle for second best.” “I will wait for the best option no matter how long it takes.” If you found yourself in agreement to these questions, you have the tendency to maximise. As an example, think of yourself searching for an apartment to rent. Do you tend to list down a number of desired characteristics (rent, distance to work, proximity to public transport, size, sunlight, air quality, orientation, etc.), look for a large set of available options, and then evaluate them on your listed parameters to come up with that one perfect apartment? Or, do you have a minimum threshold level for these characteristics and rent the first apartment that crosses your threshold levels? Similarly, do you end up spending years and years for that one right life partner who fits all your criteria or do you settle in with someone who meets the minimum requirements you have?
In 1950s, professor Herbert Simon, a polymath who contributed to diverse fields such as decision-making, economics, artificial intelligence and political science, proposed the term bounded rationality. He challenged the simplistic classical notion of homo economicus, a rational human mind that was capable of processing infinite amounts of information to come up with decisions that would maximise objective outcomes. Instead, he suggested that we did something he termed as satisficing (a combination of the words satisfy and suffice). Factors such as lack of complete information, uncertainty involved with future, and limits of our mind in terms of the calculations it can do make us choose an option that is good enough (i.e., that satisfies by sufficing) rather than try to find the thing that is the absolute best (i.e., that maximises).
Barry Schwartz (author of Paradox of Choice: Why More is Less) argued that individuals vary in their preference towards maximising and satisficing while making decisions. If you answered yes to the questions at the start of this article, you are likely to be a maximiser. Where one stands on the satisficing — maximising continuum has an impact on decision making outcomes. As an important example, Sheena Iyengar, a professor at Columbia Business School, investigated this in the context of job search process. In one her experiments, along with her collaborators, she tracked the decision strategies of students close to their graduation and job search process. She found that students who had maximising tendencies ended up jobs with 20 per cent higher starting salaries on average as compared to the satisficers. However, these maximisers ended up being less satisfied with the jobs and experienced more negative emotions such as stress and worry throughout the job search process. They also felt more regret, disappointment and frustration. The authors concluded that for maximisers, “their pursuit for the elusive “best” induced them to consider a large number of possibilities, thereby, increasing their potential for regret or anticipated regret, engendering unrealistically high expectations and creating mounting opportunity costs.”

Too much choice makes people nervous and indecisive. In another study by Iyengar that is now famously called the ‘Jam Study’ – she found that people were more likely to buy gourmet jams or chocolates when offered a limited array of six choices rather than a more extensive array of 24 or 30 choices. Moreover, participants in her study actually reported greater subsequent satisfaction with their purchase when choice was made from six as compared to 24 or 30 options. Even though we would like to go to a grocery store that stocks a huge variety of options and we would like to taste as many as possible before making a purchase, in reality we end up getting confused about which one to finally take home. And even if we take one home, we end up regretting not having bought the one with a
tangier taste or the brighter red colour one.
In my own research, we have found that maximisers tend to display larger degree of overconfidence. For example, they end up overestimating their performance and skills and feeling that they are much better relative to their peers which wasn’t so in reality. Similarly, while making forecasts of future events, they overestimated their performance even though in reality they ended up performing worse.
This paradox of too much choice — that we desire more and more options but end up being more dissatisfied ultimately — also has relevance for our societal trend towards materialistic overdrive, consuming more and more, and the desire to have-it-all and to show-it-off. Perhaps, it is better to embrace simplistic minimalistic lifestyle. Clearly, happiness, fulfillment and freedom lies in less rather than more.
Dr Kriti Jain is a faculty member at IE Busine­ss School, Spain and an EU Marie Curie Research Fellow
Kriti Jain