Research suggests we make wiser judgements before lunch, before we tire. Too late? Just sleep on it. By Amy Birchall.

Managers and executives spend their day making critical decisions - what markets should we enter? What should our strategy be? What product lines or services should we be focusing on? How do we make our organisation different from our competitors?

But even before they get to work they have dealt with any number of options. They may have already chosen an outfit from an overflowing wardrobe, ordered a tall cappuccino rather than an alternative, dressed their children and deliberated over taking the stairs or using the lift.

Organisational psychologist Dr Amantha Imber says our ability to make decisions gets worse through the day. She says this is why attempts to restructure the company or sort through an overflowing in-tray after 2pm are less likely to be productive than if the same tasks were tried in the morning.

Psychologists call this "decision fatigue", which gained widespread attention after The New York Times ran an extended feature on the topic last year.

Post-lunch slump

"After we've made 10 decisions in a row, our ability to make good decisions is compromised," Dr Imber says.

She points to a recent study by Shai Danziger, from Ben Gurion University of the Negev, and Jonathan Levav, from Stanford University. The study found judges were more likely to grant parole before lunch, but defaulted to harsher sentences for identical crimes in the afternoon.

Like most people, the judges had a limited capacity to make good decisions. When their brains got tired, they made safer decisions. It's less risky to hand down a harsher sentence, which can be reduced later, rather than granting parole and risk the person re-offending.

"Our brain is juggling a lot of balls in the air, and when that happens it starts to look for an easy way out. We choose the option with the least negative ramifications," Dr Imber says.

To explore the consequences of decision fatigue even further, Levav studied people as they selected customised extras for their new cars. He found that towards the end of the form they were more likely to say yes to heated seats or leather interiors, even if they had no intention of buying them at the start. By manipulating the order of the form and putting the most expensive items last, Levav was able to make customers spend an average of €1500 more per car.

The time factor

Falling victim to decision fatigue is easy for managers who spend a large part of each working day making choices about staff, company direction and personal projects.

"A recruitment manager who spends all day recruiting staff and deciding who gets through to the next round will often make poorer choices towards the end of the day," Dr Imber says.

"Schedule big decisions for between 9am and 11am. That's when the brain is most alert, and you'll find you make much better decisions. Managers who make big decisions after lunch onwards are making a compromise."

Unlike taking Panadol to alleviate a headache, the only thing that resolves decision fatigue is a long break without making any choices at all.

"Decision fatigue is quite hard to fix without giving your brain a proper rest. The focus needs to be on preventing it beforehand," she says.

"If you know you have to make a big decision at 2pm, schedule in some rest time. And definitely don't schedule in lots of decisions for that day."

Making better decisions

Understanding the decision-making process is key to making better decisions. There are three steps in making a decision: researching possible options, making the decision and then implementing that decision.

Research has shown the second step - making the decision - is the most tiring. In a University of Minnesota study, one group of participants was asked to browse various features available for a new computer, such as hard-drive size and type of screen, but didn't have to choose between them.

The second group had to configure a computer with a list of specified features, while the third group had to choose which options they wanted to include, rather than pondering options (like the first group), or implementing choices (like the second group).

When self-control was measured afterwards, those in the first and second group far outperformed those in the third group. Actually making the decision was found to be more fatiguing than weighing up possible options or acting on the decision.

Because we're likely to be fatigued in the afternoon, Dr Imber recommends going through the less strenuous steps in the decision-making process then, and hold off making the decision for the next morning when your brain is refreshed.

She says activating the unconscious mind, rather than the conscious, can also make it easier to make complex decisions.

"Conscious decision-making involves paying conscious attention to the decision at hand, such as by making a pros and cons list.

"The conscious mind can only juggle five or six variables at any one time, so it has a limited capacity for decision-making," she says.

Conversely, the unconscious mind processes greater amounts of information without becoming fatigued. Unconscious decision-making involves processing the decision without actually thinking about it, Dr Imber says. "Sleeping on it" is one of the most well-known types of unconscious decision-making.

Having a set routine each day can also help you make better decisions. Jeremy Fields, author of Uncertainty (Portfolio Hardcover, 2011), studied hundreds of successful entrepreneurs and discovered those who ritualised most parts of their lives were the happiest. Routine actions such as eating the same thing for breakfast and waking up at the same time each day appear to help preserve decision-making abilities for more important things.

Get yourself sorted

Lissanne Oliver, the author of Sorted!: The Ultimate Guide to Organising Your Life, Once and For All (HardieGrant Books, 2007), says an organised, clean workspace can play a key role in avoiding decision fatigue.

"When dealing with paperwork people make 30 different piles. It's too many. They're just fragmenting their decision-making," Oliver says.

She says sorting paperwork into four piles (finish, forward, file and flick) is quick, efficient and won't sap precious decision-making power.

• Finish: This pile is for anything that still needs to be completed, and can include invoices to sign off on, unfinished tax returns, incomplete performance reviews or even unwritten birthday cards.
• Forward: This is for everything you don't need any longer, such as completed forms that need to be faxed, or your boss's stapler you borrowed two weeks ago and haven't returned.
• File: All documents that must be kept for future reference. This is likely to be the largest pile and might include business cards, employment contracts and the office printer manual.
• Flick: "Make friends with your bin!" says Oliver. Throw out old newsletters, out-of-date information, excess stationery and that pre-GST price list that's been hiding under all your other paperwork since the '90s.

Allow 20 minutes for every 10cm pile of unsorted paper, resist the urge to make an "unsure" pile and you'll be well on your way to tackling decision-fatigue head on.