An analysis of how decision making biases can negatively impact your business is necessary for success. Business is largely affected by emotions and people’s tendencies to make decisions based on their emotions rather than logic. This is often referred to as the “hard sell”. Decision making biases are an inevitable part of business. They can greatly affect the way a company will operate and lead. There are three common decision making biases that can have a negative impact on your business.
One of the most common decision making biases is Status Quo. Status quo bias is a direct result of focusing too much on what others think rather than valuing what you have to offer. As a result, decisions are made with limited regard to your core business needs. Often this occurs when leaders try to do too much with too little. If you feel you are not being compensated appropriately for your efforts, you are likely to develop a status quo bias.
Another common decisional bias is the fear of failure. The people you work with may be afraid of losing control or not living up to their bosses’ expectations. In order to thrive as a business leader, you need to be able to manage stress so that you can make decisions in the face of adversity.
Tips To Avoid Making Biased Decision
When leaders take on projects they are not qualified for, they are likely to develop decision making biases that lead them to make choices that place their career at risk in front of it. Leaders must focus on completing tasks assigned to them while considering whether the project would have been better served with additional inputs from other experts. Sometimes leaders must choose between “doing the right thing” and “making the right decision”. This type of self-rewarding can lead to poor decision making and unhealthy behavior.
In addition, some leaders may try to make sure that decisions reflect only themselves. They may believe that their decisions are best made by only themselves or their “team”, but this can lead to bad decisions that affect others in the organization. To be effective, leaders should be willing to consider ideas and input from others.
Some of the most insidious decision making biases are the ones that cause leaders to withhold information. If a decision seems biased, it’s likely because leaders don’t know about it themselves. When this happens, leaders might withhold this information out of fear of creating a climate where employees feel uninformed and incompetent. Or they might withhold information out of fear of upsetting senior management and receiving a poor review for the decision.
Sometimes leaders may make decisions based on feelings rather than logic. If certain idea upsets an employee, it may seem logical to fire that employee in a fit of anger. However, this type of reaction may not be logical, and there may actually be better ways to handle the situation. In these cases, the best thing to do is listen carefully to the employee’s arguments and then make the best decision. Sometimes listening is better than simply firing.
In The End
The biggest decision making biases are usually the result of previous decisions, experience, or personal traits. If you develop a habit of avoiding decisions based on logic, you can become immune to having these problems even arise. Even if you manage to avoid situations that can create bias, using common sense is still the best defense against them. By being aware of how decision making biases can affect your life, you can work to eliminate them by recognizing when they are making decisions for you and understanding why they are making these choices.