Why do we Make Dumb Decisions?


Recently I wrote about some strategies that lawyers should be using to ensure that their bills get paid.

What’s actually more interesting than the strategies, however, is the excuses that get made when they don’t work.  Prompted by a senior member of my own firm (thanks Ash) I thought I’d set out some thoughts about why we don’t do the things we know to be the better option.

What We Tell Ourselves

Tell me if any of these sound familiar:

  • we can’t quote too high or we won’t get the work;
  • we don’t need money in trust, this is a friend of a friend – she’ll be fine to pay;
  • the matter is too close to hearing for us to ditch the client now, we’ll have to go ahead;
  • the matter was urgent so I got into the work straight away, but the client never put the money in trust so it’s their fault.

Lest I sound like I’m on my high horse in this article, I can volunteer that I’ve probably told myself (or others) all of these things, at least once.

Whether you’ve told yourself these things or not probably just depends on how senior you are – so whether or not you’ve got these kinds of decisions in your control, NOW is the time to start acting the right way and running the right kind of information through your head.

Why Those Statements are Rubbish

There’s two principle reasons, and in a sense they are exclusive of each other.

I’m going to deal with both in brief, and leave it to you to figure out which category you (or your supervisor) fall into.

Option 1 – You’re Terrified

There’s plenty of things you can be afraid of that are going to lead to these problems.  Here’s a few for you to see if they sound familiar:

  • I didn’t want to do the quote at what I think it will cost, because I’m afraid the client will walk away;
  • I was developing a good rapport with the client and I thought talking about getting money in trust would ruin it;
  • I was afraid that if I told the client it was going to cost more, they’d get annoyed at me;
  • Even though I’m within my estimate, I’ll discount my time on the bill because I think the client won’t like getting a bill this big.

Principally these come down to a few major issues.

This probably won't affect your firm's profit
This probably won’t affect your firm’s profit

First is fear of being disliked.  We all want to be liked, it’s pretty simple.  But being liked doesn’t keep the doors of a firm open – getting paid does.

Next is fear of rejection.  You put yourself out there, tell the client what it’s going to cost, and you’re afraid they’ll walk out the door (ie – reject you personally).

Last (for today) fear of incompetence.  “I should have gotten the estimate right”, “I took longer than I thought”.  We don’t want the client to think we’re incompetent, and so even when the reason for the increased bill or estimate is entirely rational, we’d rather just bury our head in the sand than actually deal with it.

And spiders – everyone hates spiders.

Option 2 – You Live in Fairy Land

The next option for these occurrences is what I’m going to call the “optimism bias”.

Before you think I made that up, you can find out a little more about it from the TED talk by Tali Sharot.

It can, however, be summarised like this: I know those things happen, but they don’t happen to me – they happen to other people.

It’s why smokers don’t actually believe they will die of something horrible.

It’s why most people put themselves into the “above average” category, despite the statistical impossibility of it.

And it’s why some lawyers choose to disengage their rational brains and make stupid business decisions.

Your natural, but foolhardy, optimism can be useful, so don’t write it off completely – however when it comes to ensuring you get paid, it’s probably best to keep your happy-go-lucky approach to life in the back seat.

Risk is OK – Provided It’s Truthful

When you next find yourself wanting to ignore some of the sensible ways in which your bills can get paid, ask yourself why.

If you want to make a conscious decision to take a risk on a particular client, then go for it.  I’m not about to say you should never do it, but I AM about to say that you shouldn’t lie to yourself in the process.

So if you think an opportunity arises then feel free to take hold of it – but in doing so acknowledge the risk, be as realistic as you can be.  If it all goes to hell then you needn’t be upset or surprised – after all, you took a risk.  But if it goes well, that doesn’t mean it will continue to go well on all future occasions.

So which mindset do you have when you make silly decisions?  Is it fear, or is it optimism – or a bit of both?

Happy Lawyering!