Decision Making and Risk — Page 306, Lesson 496

I want to walk you through a key part of decision making and risk perception. First, let's talk about how people estimate the frequency of unpleasant or negative events. It turns out that our estimates are not very accurate. Highly available or well-published events — like fatal aircraft accidents — are overestimated. We think they happen more often than they really do because they stick in our memory. On the other hand, less salient events — things that don't grab headlines — are greatly underestimated. Examples include Airprox incidents (which are near misses between aircraft), non-fatal accidents, or even the risk of contracting lung cancer through smoking. So your brain's sense of how common a risk is can be skewed by how vivid or memorable the event is. Now, let's look at the categories of risk a pilot can be exposed to. There are two types: external or objective risk, and internal or subjective risk. External risk is the risk of an accident in the current situation, if no changes are made to the flight path or the operation of systems. In other words, it's the danger that exists out there in the environment, independent of what you do — the risk of continuing exactly as you are. Internal risk is different. Internal risk reflects the inability of the crew to implement a solution due to lack of know-how or insufficient time to apply their know-how. So it's about your own capability and time pressure. Importantly, the excerpt notes that internal risk increases linearly as the deadline for making and implementing the decision approaches. The closer you get to the point where you have to act, the higher your internal risk becomes, because you have less time to apply your knowledge. We also have a definition for a risk factor. A risk factor can be defined as anything that is likely to increase the likelihood of an accident occurring. So it's a broad term for any condition or element that makes an accident more probable. Next, the decision-making process moves into developing options. Assuming that the assessed situation is identified as a problem that requires some action, the pilot must then generate plausible alternative courses of action. The excerpt gives examples: Should the approach be continued? Is it better to go into a hold to give more time to gain further information? Should the aircraft return to base? Should the aircraft divert? So you brainstorm possible actions. Then comes evaluating options. Each proposed course of action may have a different anticipated set of possible outcomes. All of these outcomes will have potential values associated with them — or costs, which may be termed as negative values. An evaluation of each outcome, together with its entailed risk assessment, is then made. So you weigh the pros and cons, and you assess the risk that comes with each outcome. Then you reach the decide stage. The Commander's choice of options, or decision, should be that which produces the most value and the least cost. The option chosen should also lead to the most favourable expected outcome and which has the least risk. Sometimes it is not possible to have both — the most value and the least risk — and a compromise must, on occasions, be made. A decision could also be to delay an action until current information is confirmed or until additional data is obtained. Having made his or her decision, a good Commander will explain the reasons for the choice to the rest of the crew. That's important for crew coordination and shared understanding. Finally, there's one further aspect of decision making and risk that is important. Sometimes there is a choice of only two actions: one is a risk, and the other is a sure thing. People tend to make their decision dependent upon whether the problem is framed as a choice between two gains or two losses. Specifically, people are biased to choose the risky loss rather than the certain loss, even when the expected loss resulting from the risky choice is greater. So if you're faced with a guaranteed loss versus a gamble that might lead to a bigger loss, you're more likely to take the gamble — even though the expected value is worse. That's a cognitive bias you need to be aware of as a pilot.