Bias and Decision Making
Managers cannot always make right decisions, but they can use their knowledge of appropriate decision-making processes to increase the rest. Decision making has been an important procedure in the management whatever in planning, organising, leading or controlling, whereas, biases affected managers’ process of decision making usually. This essay will focus on the areas of biases relevant to the decision making, the contents are comprised of the types of biases to decision making, the disadvantages of biases, possible merit of biases to decision making and the implication for managerial decision-making.
It is reported that Australian annual unemployment rate at 5.1 percentage this 5 years (source from http://en.wikinews.org/wiki/Australia_unemployment_at_30-year_low,_but_under-employed_also_at_5.1%25 Aug 10 2008). To be a positive statement, it could be said Australian annual unemployment rate kept a low level with only 5.1 percentages this 5 years, in another way, it also could be said Australia was in danger with a 5.1 annual unemployment rate this 5 years. Both of these reflected the same numerical statement, however, decision maker may response differently with same problem. Why does this happen? Because of bias.
Bias is a subjective ideas or thought. Sometimes it is injustice to receivers who got the outcome from the decision makers. There is a kind of division got from the internet: class, racism, culture, media,gender,linguistic, politice,religion,statistical number(sourced from http://en.wikipedia.org/wiki/Bias Aug, 9 2008), which is based on external environment around. Under circumstance, decision maker is easy be influenced by those. Here are focused on another kind of division. The division in the textbook organised by 10 biases as follow: overconfidence bias, immediate gratification bias, selective perception bias, confirmation bias, framing bias, availability bias, representation bias, randomness bias, self-serving bias, hindsight bias,(sourced
It is reported that Australian annual unemployment rate at 5.1 percentage this 5 years (source from http://en.wikinews.org/wiki/Australia_unemployment_at_30-year_low,_but_under-employed_also_at_5.1%25 Aug 10 2008). To be a positive statement, it could be said Australian annual unemployment rate kept a low level with only 5.1 percentages this 5 years, in another way, it also could be said Australia was in danger with a 5.1 annual unemployment rate this 5 years. Both of these reflected the same numerical statement, however, decision maker may response differently with same problem. Why does this happen? Because of bias.
Bias is a subjective ideas or thought. Sometimes it is injustice to receivers who got the outcome from the decision makers. There is a kind of division got from the internet: class, racism, culture, media,gender,linguistic, politice,religion,statistical number(sourced from http://en.wikipedia.org/wiki/Bias Aug, 9 2008), which is based on external environment around. Under circumstance, decision maker is easy be influenced by those. Here are focused on another kind of division. The division in the textbook organised by 10 biases as follow: overconfidence bias, immediate gratification bias, selective perception bias, confirmation bias, framing bias, availability bias, representation bias, randomness bias, self-serving bias, hindsight bias,(sourced