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You're About to Make a Terrible Mistake

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You're About to Make a Terrible Mistake

How Biases Distort Decision-Making and What You Can Do to Fight Them

Little, Brown Spark,

15 min read
8 take-aways
Audio & text

What's inside?

The power of collaboration can prevent unconscious biases from undermining your strategic planning.

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Editorial Rating

8

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Recommendation

Olivier Sibony has bad news, worse news and good news. The bad news: unconscious biases undermine your strategic decisions. The worse news: biases are innate, so you have little chance of eliminating them. The good news: when you collaborate, your team members can outsmart each other’s counterproductive biases and learn to make better decisions. Sibony – co-author of Noise with Daniel Kahneman and Cass R. Sunstein – presents a new “decision architecture” that may save you from yourself – and others.

Summary

Biases and other cognitive distortions undermine strategic decision-making. 

Most poor business decisions reflect cognitive traps that snare even competent, experienced executives. These mistakes result from unconscious cognitive biases.

In most situations, biases assist decision-making. The human bias toward finding patterns, for example, allows you to learn from experience and to assess new situations by comparing them to similar situations from the past. But biases can also lead to errors. When you categorize a new situation due to its similarities to a previous experience, you may overlook important differences.

Many businesses seek to curb the harmful effects of biases, such as by offering training to help employees recognize and manage their biases. Some governmental organizations use biases as a “nudge” to shape behavior for the common good. The United Kingdom’s government, for example, used the nudge concept to modify public conduct in health, tax compliance and trash disposal.

A third approach uses the tenets of behavioral science to mitigate the destructive influence of bias on strategic...

About the Author

Olivier Sibony is a professor at HEC Paris and an Associate Fellow of the Saïd Business School at Oxford University. He also co-wrote Cracked It!: How to Solve Big Problems and Sell Solutions like Top Strategy Consultants with Bernard Garrette and Corey Phelps.

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