The Implication of Bias for a Particular Type of Business Decision

The topic of this essay will be The implication of bias for a particular type of business decision. BusinesDecision bias happens not only in business decision-making but also in our day-to-day life. As most of our thought processes in the subconscious, we don’t even notice them.

In this essay, we will be looking at what is bias? How bias affect decision-making? Different types of bias, and how to prevent decision bias?. All of the topics will be discussed in brief and we will look to discuss them in detail.

We will start from the topic “what are biases?”

What are Biases?

Bias is an assumption or belief that affects the ability to make a decision considering facts or evidence. Plus, there is a chance that one may ignore the fact itself if it doesn’t match the assumption. It can be conscious or unconscious.

Moreover, biased business decisions usually result in bad choices. This in turn causes loss of the company.

There are two types of bias people make during a decision, namely: cognitive and emotional. Cognitive biases are the result of incomplete information or wrong analysis of a given situation. In the Essay’s next part; a more detailed look at how biases affect business decisions is mentioned.

How Biases affect decision-making?

Biases limit one’s the problem-solving ability and hence affect decision-making skills. Moreover, this causes challenges to cognitive ability and decreases reliability. Adding to this, it can also impair professional relationships and cause anxiety or depression.

Different types of bias

The different types of cognitive bias are mentioned below in brief:

• Conservatism bias: In this bias people hold their previous information against new data. This can result in a slow decision. Moreover, in a business setting, this bias can result in the delayed decisions and possible loss of opportunity.
• Base rate neglect: In this bias, people pay little attention to the original information available to them.
• Confirmation bias: Here people only seek information that confirms and matches their assumptions and ignore the one that doesn’t.
• Sample size neglect: It is an error made when people try to suck out too much information from too little data. Whereas, in order to make a difference a large enough data set must be available.
• Hindsight bias: This bias occurs when a person accepts the outcome as true and reasonable but only after confirming it with fact. This makes people take too much risk as they overestimate the accuracy of the outcome.
• Anchoring & Adjustment: Anchoring and adjustment bias takes place when somebody attaches themselves to results or outcomes. This makes them remain focused on those original targets even if the outcomes begin to differ from what they anticipated.
• Mental accounting: This is when people place different values on money, which leads to irrational decision-making.
• Availability bias Regency bias: It means being biased towards assumed future possibilities based on past events.
• Framing bias: Framing error happens a person interprets the same information differently based on the way it is presented.

How to prevent decision bias?

As humans, we cannot completely avoid being biased. As our mind seeks efficiency, information processing for day-to-day decisions is subconscious or automatic.

However, it is found that if a person understands why they are biased and if they are biased; they can prevent them. In addition to that, here are some steps on how to prevent being biased:

• Learning and studying about cognitive biases can help one understand and recognize them. Then a person can also plan the countermeasures.
• If you are in a situation where you think you can make a biased decision then you should question your decision. And also seek advice from a trustworthy person.
• To avoid making a biased business decision, a group should be assembled and collaborate. This will help in the prevention of biased decisions as a number of people are involved.
• A person should ignore information that may cause a biased decision and are not of valuable nature.
• Make plans and follow them to avoid making irrational biased decisions.

Do you need assignment Help in Singapore?

We provide assignment help services in Singapore, round the clock and 100% plagiarism-free. Our team of experts also provides services like Singapore essay writing, Singapore assignment helper, pay someone to take my online class, homework support.

Plus, we provide all of these services at a cheap rate and provide free revision. On top of that, there is more samples essay related to this on our website. Examples are Cognitive dissonance theory, Rational Emotive Behavior Therapy, Development of Psychology Reflection, Model of Adaptive Grieving Dynamics, and Kohlberg’s Theory of Moral Development.