Role of Decision Making
When dealing with business situations, where you have to make you have to make decisions, especially when it involves implicating and confidential information, there are certain things you need to put into consideration, because there is always possibilities that issues such as biases, emotions fairness on all the parties involved, would rise. Therefore it is very essential to put all these things into consideration in to make effective decisions.
Common Biases
When making decisions, there are various biases we may encounter, which really is sometimes a human factor. The most common bias we encounter when making a decision is the confirmation bias, it is very common because people mostly display it unknowingly. This happens when people seek for information that supports their existing believes and ignore any information that could go against their belief. Then there is anchoring bias; this is when people jump to conclusion, in other words to solely make decisions based on information gathered from the start of your decision making process. There is also over-confidence bias; this one is knowledge and opinion based. You may tend to think that your contribution to a decision is actually more valuable than it actually is. Gambler’s fallacy, this occurs when you tend to make decisions based on your previous events, simply because the fact that previous events went well, you might have the belief a decision you want to make would have the same course each time you want to make a decision. The last one here would be the fundamental attribute error; this type of bias is when you put blame on others when something goes wrong, instead of analyzing the situation and finding out what actually happened (Mind Tools, 2015).
Roles of emotion in decision-making
When making decisions, it is inevitable to encounter some emotions in the process. Decision making usually occurs when uncertainty factors arise about whether one’s choice will lead to benefit or harm. In the case of uncertainty, the somatic maker hypothesis is a neurobiological theory of how decisions are made in the case of uncertain outcomes. The theory is designed to maximize reward and minimize punishment when making decisions. Somatic makers are a case of feelings made from secondary emotions, in other words emotions that let us predict future results of some scenarios. “ Imagine if you were an owner of a company probably under the influence of high ratio and the concept of common sense tells you that the formal logic will provide the best possible solutions to any problem that may occur” (Write pass journal, 2015).
In the case of Mary Smith, the market manager of Acme Automotive Accessories, where she has