In what ways do cognitive biases affect decision-making Assignment

In what ways do cognitive biases affect decision-making - Assignment Example Cognitive biases affect decision-making when one wants to simplify complex decision situations (Das & Teng, 1999, pg. 760). Severe and systematic errors in decision-making result from the applications of ‘rule of thumb’ and adoption of heuristics. The contemporary ever-changing society does not allow long-term strategies, and in most cases, a quick decision saves company resources and determines their success in the business environment. There is often a need to evolve with the changing times and at times one has to make short-term and quick decision to address immediate needs. Cognitive biases result in temporal orientations in which one uses past happenings to predict the future impact of a decision. ‘Availability’ is a major heuristic that triggers cognitive biases, which eventually affect decision-making. It provides the bias of imagining in which decisions are about recent experiences. Decision makers often use their beliefs and previous experiences in current decision-making situations. This is common in organizations that focus on selected targets rather than broad-minded solutions. In such cases, cognitive biases arise because one may overlook important evidence and worthwhile objectives that may produce a different solution (Das & Teng, 1999, pg. 762). Cognitive biases limit a person to a limited number of objectives that can attain a goal. A small number of options if often favorable for most people and businesses because it saves time, energy, and money that could go to waste in brainstorming meetings. In the end, they have a list of alternative ideas that do not encompass fresh outlooks into a problem (Das & Teng, 1999, pg. 762). The assumption that ‘what has, will always be’, is dangerous, because it hinders appropriate decision-making. They serve as a as an impediment in the recognition of scientific non-intuitive knowledge. Cognitive bias develops an illusion of manageability in which a possibility of success higher than the