Overcoming Cognitive Biases in Decision Making (original) (raw)

Overcoming cognitive biases is crucial for effective decision-making in organizations. Decision managers (DMs) must be aware of the two main sources of biases: System 1 thinking, which relies on automatic, intuitive judgments, and System 2 thinking, characterized by flawed reasoning due to cognitive limitations. To mitigate these biases, DMs should employ techniques such as making multiple estimates, engaging in pre-mortems, and adopting an outside view. By broadening their perspectives on objectives and options, using tools like checklists and algorithms, and recognizing emotional influences, DMs can improve the decision-making process. However, a potential limitation arises from not clearly differentiating between rational evaluation of alternatives and cognitive biases associated with sequential evaluations.