From the February 2014 issue of Investment Advisor • Subscribe!

Too Many Choices = No Decisions

Sidebar to "Getting Clients to Follow Your Advice"

Studies have shown that offering people too many choices may cause them to stick with the status quo—a tactic that can be useful if clients want to change from an agreed-on plan to something that isn’t in their best interest. To illustrate, Kol Birke of Commonwealth Financial Network told webinar participants about a research study in which doctors were given the case of an older patient who was about to be sent for hip replacement surgery.

Birke explained, “Half of the doctors in the study saw a note in the case file that said, ‘Actually, we forgot one thing. We forgot to try ibuprofen. Would you like to pull the patient out of the queue for hip replacement and try ibuprofen first?’” As a result, 73% of these doctors did try ibuprofen instead of surgery.

Birke continued, “The other half of the doctors received the same patient’s case file, but their note said, ‘Would you like to send this patient on to hip replacement, or would you like to try them on ibuprofen or this other anti-inflammatory called Piroxicam? And if one of the drugs, which one would you like to try?’

“Rationally,” Birke noted, “the doctors in the second group should have jumped at the possibility of trying medication first, because now they’ve got two chances to keep the patient out of surgery. In fact, Piroxicam is more powerful than ibuprofen, and so might have even a better chance of working.” However, only 52% of the doctors in the second group chose to go with one of the drugs.

Why? Because now they faced a second decision (which medication to use) instead of a single decision between hip replacement and a drug. Because the brain is lazy and wants to avoid a second decision, 21% more of the doctors opted to continue with the status quo, which was surgery.

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