Identify a decision making scenario (e.g., real-world application) applicable to each of the four concepts examined. Use four different scenarios here (one for each concept), one general scenario (applied to each concept), or anything in between. Briefly describe the scenario and then, for each concept, explain
(1) How bias is recognised or identified in the scenario,
(2) Methods by which bias may be measured or evaluated in the scenario,
(3) Strategies to address, ameliorate or overcome bias in the scenario, and
(4) How this process may improve decision outcomes in the scenario.
The concept of objective rationality or rational objectives, in more simple terms can be described as the attribute of the decision maker characterized by the ability to take rationally appropriate critical decisions. It allows the individual decision maker to be adept with the taking the decision that the most reasonable to the scenario, that can be mutually beneficial for all the stakeholders associated with the scenario under consideration. However in this context it has to be understood that there are many external and internal factors like interpersonal bias that can affect the decision making process (Roever & Biondi-Zoccai, 2016). One of the key bias situations that are a part of this factors are Overconfidence, Conformation bias, Availability heuristics, and Framing effect. This assignment will focus the four above mentioned bias situations and how these factors interfere with the decision making scenario.
There are many external and internal factors associated with the process of decision making; overconfidence is one of those contributing factors. The phenomenon overconfidence can be defined as the situation where the subjective confidence of the individual decision maker influences the objective rationality or accuracy substantially. It has to be understood that self confidence is one of the greatest attributes or strengths that is required for efficient and succinct critical decision making. Therefore it has to be understood that in case of overconfidence that can be adverse effects on the decisions that again made and how it impacts the crisis scenario. For instance if we consider a real world decision making scenario, where overconfidence dance is a significant element affecting the decision made and its impact on that scenario, the intensity and stages of insurance each of these biases have can be evaluated thoroughly (Newell & Shanks, 2014).
If you consider as an area where a hypothetical business corporation facing financial crisis can be an excellent decision making scenario for this assignment where the decision maker has to make a critically reasonable judgments about managing and successfully overcoming this potential risk. Furthermore if we consider that the particular individual took a decision to launch a new line of products to surprise the customer it is an increase the profits in order to lift the company out of the financial crisis, this entire scenario can be an excellent template where attachment can both be positive and negative. In this case we can easily assume this particular decision to be extremely in French by the overconfidence of the decision maker. Presuming that the particular decision maker in question is an entrepreneur, it can be understood that this overconfidence can be an essential pursuit of the entrepreneur as they often need to engage risk taking (Moradi, Mostafaei & Meshki, 2013). However, in this case we have to consider that overconfidence in some cases can be extremely dangerous, for instance in a financial crisis, while the sales of the existing products are already down, launching a completely new line might be the last blow to the financial sustainability of the organization. As Simon in this article has opined, the capacity of human mind to make a critical judgment is not enough for the magnitude of solution required, and these judgments can sometimes be clouded by the overestimation and overconfidence. In his article the author has described how the cognitive section of human brain responsible for finding solutions is much smaller in comparison than what is required for the magnitude of solution needed.
As a measurement strategy to evaluate the impact of overconfidence bias on the critical decision making to figure out a solution for any tricky risk situation as we have discussed in the assignment can be consumer analysis. It has to be understood that in the case scenario opted for this assignment the industry undergoing financial crisis was opting out to launch a new line of products as a surprise element to recapture the attention of the consumer base. It has been previously established that such a huge risk is filled by the overconfidence bias in the decision maker presumably an entrepreneur, which can potentially lead to downfall of the startup industry. Hence as a preventative strategy some analytical frameworks can be used to improve the decision making prowess (Marshall, 2016). Market research or consumer analysis can be one of the best techniques or tools that can improve the decision making power of the entrepreneur in this situation. Other business analytical tools like SWOT analysis cost benefit analysis feasibility study can be potent tools in the hand of an entrepreneur to ensure that fi has does not influence better judgment. It has to be understood that human mind works in complex methods, and cognitive decision making is a very critical procedure involving value based and comparison based ranking of options, a method which sometimes can be inadequate given the magnitude of the solution required. This scientifically reasonable and rational tools will help restore rationality and scientific objective of the decision making. Exercising these surgical Tools and techniques will ensure that individual decision maker is not as easily influenced by overconfidence bias overestimation in the near future as well (Marek, Day & Hudzik, 2016).
Confirmation bias a confirmation bias can be called the tendency in an individual to investigate interpret favor or recall information that in some way or the other confirms a pre existing and prefixated belief or hypothesis. This is when a decision maker looks for data and information that we are found his original beliefs. In this case if we consider the example case scenario opted for this assignment, while conducting market research and consumer analysis using the analytical tools and techniques for improve critical judgment, then it can be considered a confirmatory buyers from the end of the judgment maker (Mahmoodi et al., 2015).
In this case the buyers can be evaluated by assessing the quality and dedication of the market research or consumer analysis that the judgment maker is fixated at finding out details that support his original plan then it can be considered as confirmatory bias. Now considering another scenario, if a business professional is asked to perform a market analysis for a particular line of product, and if he only focuses on advantages and potential profits of that product excluding any potential risk or potential Pitfall in the situation it can be an excellent example of confirmatory bias. In both scenarios the confirmation bias is prevalent and can be evaluated by the content of the market research done by both decision makers (Magnavita & Lilienfeld, 2016).
A strategy that can be utilized to evade confirmatory bias, is facilitating are having an accurate and active communicational panel. It has to be understood that confirmation bias is just the human inclination to what we originally see fit, hence one person's confirmation bias will not be another person's as well. Hence is the decision maker conveys his decision to Consultants it can provide him inside about whether his decisions are influenced by confirmation bias or not (Lauriola et al., 2014). This strategy of feedback from peers or a professional consultant will educate the decision maker and evolve m into recognizing and actively avoiding confirmation bias in the future.
As mentioned by Simon in his article, he has very accurately explain how human mind and its decision making powers are not nearly enough for the magnitude of the decisions or solutions we need to find in critical situations. Henceforth human minds strives to discover shortcuts for making the best decision possible in such situations. Now these shortcuts pave way for different external and internal buy a strange science the rationality objective of the decision. Considering the main case scenario of this assignment, if in the given crisis situation for the industry is facing of financial breakdown, if we presume the decision of launching a new line has been the immediate shortcut that the brain could we call from past experiences then this buyers can be called availability heuristic (Kunz, Sigron & Jaquiéry, 2013).
Now considering a completely different scenario, given the fact that a company is facing a legal crisis where a customer has suit the company for deception after receiving a particularly broken item. Now in this case if the management authority decides to placate the customer with renewed product with complimentary gift items as a shortcut to retain the customer based on previous experiences, without assessing and analyzing the issues with the customer priorly can be considered availability heuristic bias (Dias et al., 2013).
This kind of bias can be easily evaluated by the judgment maker by the means of assessing the rationality and success potential of the decision. Strategy to avoid availability heuristic bias in the decision making can be exercising reasonable analysis of the decision prior to taking it. Pre analysis of the critical decision taken by the decision maker before implementing it will ensure that his decisions are in no manner influenced by availability bias and will restore the best fit for the particular situation (Dias et al., 2013).
The last potential buyers in this discussion is framing effect, a cognitive bias where the individual decisions are influenced by perception and presentation of the particular options. On a more elaborative note, here people tend to read to a particular decision on option in a manner in which it is presented as, be it a gain or a loss. If we consider the main case scenario of the for this assignment the idea of launching a new line to combat the potential risk of financial breakdown can be taken by the decision maker influenced by the way the idea was represented by some other individual. For example if a business Project leader represents the idea of launching a new line in a manner that strongly suggest at the success of this particular venture balancing out the financial break down the company is facing then the managerial decisions can be swayed by the positive presentation (Croskerry, Singhal & Mamede, 2013).
Taking help of another scenario, if I presume that a company employee have been accused of data theft and he frames the scenario in a story that sympathizes him instead of convicting him it can be an excellent example of framing effect. Going back to the article by Simon the earth explain how the human mind is not adequate Tennis Cricket judgement functionality with respect to the magnitude of the crisis situation. Hey the most feasible course of action for human mind is to cling to a belief that has positive outcome. Framing effect exploits this tendency of human brain in decision making and influences the judgment restricting it to have any rationality objective (Croskerry, 2013).
Strategy to avoid being influenced by framing effect is relying on statistical data other than human representation of the data. Focusing on figures and numbers will ensure that the decision of the judgement maker is not influenced by the way the figures are being represented and will stick to the facts instead of being swayed by the play of words. It will also ensure that the decision maker develop the habit of depending and relying on statistical and genuine facts and figures rather than being swept by a positive representation of a potentially risk inducing data (AlQudah et al., 2015).
Hence, on the concluding note, it can be said that there can be humorous internal and interpersonal biases that can influence the better judgement or judgement making powers of human brain. It must not be forgotten that we only use a small percentage of our total brain capacity and in order to cope with the daily requirements human brain has to struggle at each second. However a single floor in the critical decision making can result in a major failures in a corporate scenario or any other professional scenario. Hand strategize usage of analytical Tools and techniques to avoid and minimize the impact of these biases can be the safeguard for business professional.
AlQudah, H. N. I., AlJarah, S., Adnan, W. A. W., & Keng, S. L. (2015). Assessment of Cognitive Bias in Decision Making Among Critical Care Nurses in Jordan. International Journal for Human Caring, 19(4).
Croskerry, P. (2013). From mindless to mindful practice—cognitive bias and clinical decision making. N Engl J Med, 368(26), 2445-2448.
Croskerry, P. (2014). Bias: a normal operating characteristic of the diagnosing brain. Diagnosis, 1(1), 23-27.
Croskerry, P., Singhal, G., & Mamede, S. (2013). Cognitive debiasing 1: origins of bias and theory of debiasing. BMJ quality & safety, 22(Suppl 2), ii58-ii64.
Dias, S., Sutton, A. J., Welton, N. J., & Ades, A. E. (2013). Evidence synthesis for decision making 3: heterogeneity—subgroups, meta-regression, bias, and bias-adjustment. Medical Decision Making, 33(5), 618-640.
Kunz, C., Sigron, G. R., & Jaquiéry, C. (2013). Functional outcome after non-surgical management of orbital fractures—the bias of decision-making according to size of defect: critical review of 48 patients. British Journal of Oral and Maxillofacial Surgery, 51(6), 486-492
Lauriola, M., Panno, A., Levin, I. P., & Lejuez, C. W. (2014). Individual differences in risky decision making: A meta?analysis of sensation seeking and impulsivity with the balloon analogue risk task. Journal of Behavioral Decision Making, 27(1), 20-36.
Magnavita, J. J., & Lilienfeld, S. O. (2016). Clinical expertise and decision making: An overview of bias in clinical practice.
Mahmoodi, A., Bang, D., Olsen, K., Zhao, Y. A., Shi, Z., Broberg, K., ... & Roepstorff, A. (2015). Equality bias impairs collective decision-making across cultures. Proceedings of the National Academy of Sciences, 112(12), 3835-3840.
Marek, G. J., Day, M., & Hudzik, T. J. (2016). The utility of impulsive bias and altered decision making as predictors of drug efficacy and target selection: rethinking behavioral screening for antidepressant drugs. Journal of Pharmacology and Experimental Therapeutics, 356(3), 534-548.
Marshall, D. R. (2016). From employment to entrepreneurship and back: A legitimate boundaryless view or a bias-embedded mindset?. International Small Business Journal, 34(5), 683-700.
Moradi, M., Mostafaei, Z., & Meshki, M. (2013). A study on investors’ personality characteristics and behavioral biases: Conservatism bias and availability bias in the Tehran Stock Exchange. Management Science Letters,3(4), 1191-1196.
Newell, B. R., & Shanks, D. R. (2014). Unconscious influences on decision making: A critical review. Behavioral and Brain Sciences, 37(01), 1-19.
Roever, L., & Biondi-Zoccai, G. (2016). Critical Appraisal of Bias in Systematic Reviews and Meta-Analysis. Evidence Based Medicine and Practice, 1, e116.
This problem has been solved.
Cite This work.
To export a reference to this article please select a referencing stye below.
Urgent Homework (2022) . Retrive from https://www.urgenthomework.com/sample-homework/stat1060-business-decision-making-for-the-critical-decisions
"." Urgent Homework ,2022, https://www.urgenthomework.com/sample-homework/stat1060-business-decision-making-for-the-critical-decisions
Urgent Homework (2022) . Available from: https://www.urgenthomework.com/sample-homework/stat1060-business-decision-making-for-the-critical-decisions
Urgent Homework . ''(Urgent Homework ,2022) https://www.urgenthomework.com/sample-homework/stat1060-business-decision-making-for-the-critical-decisions accessed 29/09/2022.