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12 The Common Biases in Decision Making and How They Might Be Overcome

   

Added on  2019-10-31

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The common biases in decision making and how they might be overcome 1THE COMMON BIASES IN DECISION MAKING AND HOW THEY MIGHT BEOVERCOMEName:Institution:Course:Tutor:Date:

The common biases in decision making and how they might be overcome 2IntroductionIn the global business community, managers are always presented with the multitude of issues that they have to deal with on a daily basis. Some of these issues need quick on the spot decisions while other issues need more depth in understanding. Different judgments along with choices that managers make are always based on various beliefs that relate to results of several events (Chaxel et al., 2013, p. 563). Managers that support different operations of organizations rely on heuristic principles. It is these principles that also determine the effects of biases in decisions made by various managers. Beside, heuristics principles refers to different regulations of thumb along with techniques of cognitive that managers and other individuals utilize with target of decreasing amount of information processing needed when making different decisions. In most cases, biases in process of decision creation by managers occurs when they have tendencies to make different operational decisions based on cognitive factors instead of considering the appropriate or facts as evidence. These biases created during the process of making appropriate decisions by managers happen as consequences of utilizing information processing shortcuts and heuristics principles (Leonhard 2017, p. 391). It is clear that the standard product of the thinking of managers are biased and it is these biases that can probably skew the reliability of evidence that managers and other workers in organizations present in theirprocess of making decisions. Therefore, principal target of this research paperwork is to examinesome common biases that managers make in the process of attaining different operational decisions, and it also illustrates different techniques that might be applicable in overcoming thoseidentified biases. Common biases during decisions creation process by managers

The common biases in decision making and how they might be overcome 3Some of the most common unfairness in procedure of creating decisions by managers remains to be stereotypes, selective perception, confirmation bias, first impression biases, spillover biases, Recency bias, together with similarity bias. There exist many types of biases that can affect efficient process of making operational decisions by managers (Blumenthal-Barbyand Krieger 2014, p. 543). They range from boldness bias, confirmation prejudice, anchoring prejudice, along with availability unfairness, randomness error, to appreciation of dedication among other factors. Other common biases made during the process of making decisions by managers include hindsight bias and winner’s curse where managers only allow highest bidders to pay too much to the overestimated value of any service or product that the organization deals with around business marketplaces. However, Hawkins and Fletcher (2013, p. 610) identified several internal biases that always lead to the wrong process of decision making by managers. They include inappropriate prejudgments, self-interest, and inappropriate experience, along with attachments. For instance, these authors explained that cases of biases resulting through prejudgment happen when managers responsible for making decisions select the course of actionwhile ignoring or assuming any advice or data that do not support that decision taken. For inappropriate experience, these authors explained that it leads to biases in the process of decidingby managers as it can be summed up as “what efficiently worked prior people work again,” as this remains to be the far too common among executives that deals with marketing (Madaan 2016, p. 12). Besides, this approach helps in explaining why most managers continue with the status quo in the face of ever-shifting consumers’ requirements in the international economy. Furthermore, some common biases in the process of deciding by managers are discussed below;Selective perception along with confirmation bias

The common biases in decision making and how they might be overcome 4Here managers of different organizations are cable of exhibiting bias in their perception by unknowingly concentrating on only the portion of operational information accessible to their operations that refer to as the selective perception. For instance, perhaps the organization manager has the keen interest in while enjoying discussing financial, statistical data (Daftary-Kapur et al., 2010, p. 137). The worker in such case owes operational manager three different reports, but only one concerning with finances is what a manager uses in making decisions. The worker can always have prepared well all the reports, but the financial report is always rushed and incomplete before presented for making different decisions. Therefore, when managers focustheir attention on the poor quality of report that deals with financial statements while ignoring the quality of facts of the other operational reports, they exhibit selective perception. Cases of selective perceptions always lead to other types of biases during the process of making operational decisions by managers. If the manager has the negative opinion on an individual during their operations, they might remain to pay extra attention to negative traits, behaviors, or actions from that specific individual while ignoring the positive actions or operations that would contradict the opinion. However, when cases of selective perception by management are well employed to confirm existing individual’s opinions, it refers to as the confirmation bias (Blumenthal-Bardy 2016, p. 8). In most cases, confirmation bias among manager during the process of making decisions occurs when they form the decision and later look for the affirmation of their belief instead of testing and challenging such decision against operations of other organizations globally. First impression bias

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