Question

Hello,

Can i get a detailed summary/critique for the following article, "Dangerous biases can creep into every strategic choice. Here’s how to find them— before they lead you astray. by Daniel Kahneman, Dan Lovallo, and Olivier Sibony"

Thank you

Answer 1

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My Summary - And though there might be even more conversation among managers regarding prejudices now, talking alone won't eradicate them. But to combat these, steps can be taken. A new research by McKinsey on major business investments found that when companies sought to reduce the impact of bias in their decision-making processes, they generated up to 7 percentage points higher returns. Cutting down on prejudice makes a difference. We also defined in this article a straightforward way of identifying prejudice and mitigating its impact in the most common form of decision that executives make: evaluating someone else's advice and deciding whether to endorse it, reject it or move it on to the next level. Those comments sound pretty easy enough for most executives. Second, they have to understand the actual information easily (getting them from others who know more about the specifics than they do). Third, they must "guarantee that the individuals issuing the decision deliberately distort the evidence in any way. Then, ultimately, they will use their own expertise, information, then logic to determine if the advice is right. However, this mechanism is rife with the potential for judgmental errors arising from cognitive prejudices at any point. As we can see, managers can't do a thing with their own prejudices. But with the right resources, their teams will identify and neutralize such. Over time they can create judgment mechanisms by utilizing these methods that raising the impact of prejudices in their organizations. So in doing that, they'll further improve the efficiency of their organizations ' decisions.

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