Monday, June 20, 2011

Decision Making Biases

We all make decisions, and I suspect we feel we make most of those decision objectively... or do we?

Here is a great article from HBR about decision making biases (free access till July 4, 2011), the best part is the survey link at the start of the article. Once you answer the survey, it compares your answers to other respondents' answers and grade your decision making biases from low risk to high risk for the following biases:

Pattern Recognition Bias - The "Oh, I have seen this before. Here is what are going to do ...."
Action Orientation Bias - The need and bias for action in part of decision maker
Stability Bias - The need to do as you have always done it
Social Harmony - The "group think", or "here is what everybody else think/say we should do ..."
Process Orientation Bias - Speaks for itself
Self-Interest  Bias - simply put, thinking what is good for you is good for the firm or whoever suggest an option, always makes it with the best interest of firm in mind.

The one, the jumps at me in particular is the "Social Harmony" bias, specially harmony with upper management. This is one bias I have seen so predominantly is most all decision making. Specially when upper managements do not formally separate discussion and decision and simply voice a strong opinion in a debate. Expressing dissent after that becomes so risky that even if you don't have the bias, you are likely to adopt one temporarily !


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