Cognitive Thinking and Biases:

Relying on Emotions to Make Decisions: When logic and analytical skills (capacity to reason) are inadequate to make right decisions

1. By virtue of being humans, we are all vulnerable to emotional traps.

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2. Our values and preferences are quite different.

Consciously or unconsciously, we utilize our values and intuition when we make decisions. 

We should also understand that individuals make decisions differently, even when presented with the same set of information and facts.

Key Challenge:

When the consequences of our emotional traps can be disastrous, do we have the discipline to allow our analytical and logical skills to supersede our emotions in order to avoid disastrous consequences?

Using emotional tags in the decision-making process:

1. Emotional tags are necessary to make decisions—to focus on the decision-making process.

2. How does the level of emotional maturity and experience influence our decision-making process?

3. When and how do emotional tags create problems and with disastrous consequences?

4. When and how do conflicting and misleading emotions become detrimental to the decision-making process and the eventual decisions we make?


Please note:

Several cognitive biases and emotional tags are relevant (can be applied) to each statement.

Your presentation is assessed in terms of the following:

1. Your review of the required readings, selection, and explanation of specific cognitive biases relative to the statements provided.

2. Explaining how the biases in the statements influence or affect the decision-making process.

3. Address how each of these statements and biases affect gathering, interpreting, and evaluating information. 

Scenario One:

“That’s the way we’ve always done it”

Consider the following: the status-quo, stability, comfort zone, confirmation, anchoring, gambler fallacy and hindsight biases.

● Comfort zone and stability bias (status-quo or conservative bias)

We are comfortable with the status-quo, particularly when there is no pressure for change.

Making decisions we know how to make rather than the decision we need to make.

● Gambler’s fallacy: Pattern of success or failure:

With the gambler’s fallacy you expect past events to influence the future.

● Confirmation bias: How previous experiences influence our perception of making the best decisions.

● Anchoring bias: There is a tendency to jump to conclusions – to base your final judgment on information gained early on in the decision-making process.

Critical Thinking:

Consider the following: Risk aversion and preference for the status quo:

It is true that in a chaotic and complex business environment, leaders should be extremely cautious because it is increasingly difficult to anticipate or forecast changes in the business or economic environment.

Your knowledge about the past, good and bad decisions, can be helpful in making current or future decisions.

However, being overly risk averse and focusing on the past has some major limitations.

Previous events and decisions are not always an important barometer or guide for current or future decisions.

You should have the capacity to adapt as events develop and change.

You also risk missing important new opportunities if you are risk averse or preoccupied with the past.

Scenario Two:

“The CEO needs to validate it first”

You correctly identified the authority bias.

Consider the framing and confirmation biases.

Critical Thinking:

1. We have no knowledge of the context of the problem or decision—whether it is simple, complex, complicated or chaotic.

2. However, we can assume that the organization, based on its structure, centralized or decentralized, has established procedures for its decision-making process.

3. Is it a complex or complicated context where the organizational procedures require consultation with the leadership, or where the final decision is made at a higher level?

 Consider the authority and confirmation biases:

Vertical Relationships:

You are accustomed to vertical relationships in the traditional command and control structure of centralized organizations–such as the military. You follow orders and you do as you are told.

You develop the discipline to think very carefully about the consequences of your actions.

Now, you must adjust, and understand that while you are accustomed to working in teams, in the civilian context, (private sector environment) you invariably work in teams and groups where you must build consensus by considering numerous viewpoints and alternatives before arriving at a decision.

Scenario Three:

“Trust me. I know this won’t work.”

Did you consider the following biases?

Overconfidence, framing, expert knowledge. self interest and negativity biases.

● Negativity bias: Making decisions in terms of outcomes—positive or negative

Decisions that irrationally attach more weight (value) to negative rather than positive outcomes.

● Overconfidence bias

Attaching too much emphasis (faith) in your own knowledge and opinions. Exaggerating your importance or contribution to the decision-making process.

Critical Thinking:

1. Assess the risks and uncertainty—new ideas and potential benefits/rewards.

2. Context of Decision: Is the problem complex or complicated?

Scenario  Four:

“If it’s not broken, why fix it?

Did you consider the following biases?

Availability bias: Focus on the idea that is readily available. Failure to consider other alternatives—better or more effective alternatives.

Sunk Cost: Making decisions in terms of winning or losing.

Maintaining an outdated method or strategy because so much time and resources have been invested in it.

Framing the issue relative to cause and effects—cost and benefits and potential rewards.

 Assess risks relative to the cost and benefits—potential losses relating to scarce resources and the potential benefits.

Scenario Five:

“There’s no budget for this risky stuff”

Additionally, consider the framing, outcome, and sunk cost biases

 Critical Thinking:

Assessing the organization or leadership’s aversion to risks.

Recognizing risks as a critical component of the decision-making process:


1. Acknowledging (accepting) the possibility that the decision (problem-solving solution) could fail.

Leadership attitude and organizational capacity to accept failure.

2. Recognizing the different levels of risks and knowing when to act.

What are the elements of risk at each level?

Prioritizing Risks:

Distinguishing between (a) high risk level; (b) medium risk level; and (c) low risk level.

3. Establishing an effective organizational process to identify and analyze risks.

Risks in the Business Environment:

Technical and Business Risks:

Developing such a capability would enable the organization to respond to current and future challenges.

Understanding and improving the capability to respond to internal and external challenges.

Scenario Six:

“Let me check with the team and see what they think”

You correctly identified the confirmation bias.

Consider the framing, bandwagon, group thinking and authority biases.

Critical Thinking:

Multidisciplinary and functional teams are now indispensable for collaboration, innovation, knowledge sharing, research and development and numerous problem-solving and decision-making tasks in business organizations.

Effective teams and groups establish their scope and objectives and the processes for making decisions.

To facilitate overall participation and consensus building, they could decide to make decisions by consensus or majority vote.

Therefore, while the team decision-making process may be time consuming and vulnerable to “group thinking,” it has very important advantages.

Avoiding Decision Paralysis:

Building consensus and ensuring members of the group have been given an opportunity to participate in the deliberation.

Effective participation and the building of consensus ensure that there will be a commitment to successfully implement the final decision – even from those members who do not agree with the final decision.

The objectives of the decision-making process, alternatives and consequences have been adequately addressed.

Members could now turn their attention to selecting the best option (making a decision) and how the decision should be successfully implemented.

Address how each of these statements and biases affect gathering, interpreting, and evaluating information. 

Example:  Confirmation Bias

Avoiding Confirmation Bias:

1. How do you avoid confirmation bias when collecting (analyzing) data and information?

2. Confirmation bias is a serious problem to avoid when dealing with data and making statistical analyses.


1. Utilize techniques that facilitate problem-solving and decision-making from multiple perspectives.

2. What is your level of emotional intelligence and maturity?

Self-introspection: How do you challenge or examine how you think and make decisions?

3. Consider information from a range of sources

4. Building effective horizontal; relationships: Solicit input from others. Friends, colleagues and professionals

5. Be receptive to those who are inclined to offer constructive and alternate perspectives                                   .

Example: Anchoring Bias:

Avoiding Anchoring Bias:

1. What is your level of emotional intelligence and maturity?

● How do you act or make decisions under pressure?

● Do you tend to act hastily?

Decision-making History: Reflect and assess how you have made previous decisions?

3. Do you have a pattern of rushing to judgment?

4. Change your decision-making pace and avoid rushing to judgment.

5. Consider the consequences of your choices/decisions.

Example: Overconfidence Bias

Avoiding Overconfidence Bias:

1. What is your level of emotional intelligence and maturity?

2. Do you recognize the limits of your knowledge and how you perceive risks?

3. What are the sources of information and knowledge utilized when you make decisions?

4. How do you recognize and prioritize risks?  Recognizing the different levels of risks and knowing when to act.

Prioritizing Risks:

Distinguishing between (a) high risk level; (b) medium risk level; and (c) low risk level.

5. Do you accept the accepting) the possibility that the decision (problem-solving solution) could fail?

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