Link: https://theknowledgeeconomy.wordpress.com/2023/01/31/cognitive-bias-in-decision-making/
Cognitive biases are systematic patterns of deviation from norm or rationality in judgment, whereby inferences about other people and situations may be drawn in an illogical fashion. These biases are often a result of the brain’s attempt to simplify information processing. Cognitive biases can lead to perceptual distortion, inaccurate judgment, illogical interpretation, or what is broadly called irrationality.
There are many different types of cognitive biases, including:
- Anchoring bias: the tendency to rely too heavily on the first piece of information encountered when making decisions
- confirmation bias: the tendency to search for, interpret, favor, and recall information in a way that confirms one’s preexisting beliefs or hypotheses
- representativeness bias: the tendency to judge the probability of an event based on how similar it is to a prototype
- availability heuristic: the tendency to overestimate the likelihood of events based on their availability in memory
- framing effect: the tendency to be influenced by the way information is presented
- overconfidence bias: the tendency to be more confident in one’s judgments than is warranted by the available evidence
These cognitive biases can have significant effects on decision making, leading people to make judgments that are not logically sound or that deviate from statistical norms. For example, the confirmation bias can lead people to seek out only information that confirms their preexisting beliefs, while ignoring information that contradicts those beliefs. This can result in a distorted view of reality and poor decision making.
It is important to recognise and correct for cognitive biases in decision making, as they can lead to suboptimal outcomes. One way to do this is through the use of decision-making frameworks, such as the Six Sigma approach, which seeks to eliminate defects and variability in business processes. Another way is to use structured decision-making approaches, such as decision trees, which can help to mitigate the influence of cognitive biases by breaking down complex decisions into smaller, more manageable steps.
In addition to these approaches, there are also various techniques that can be used to reduce the impact of cognitive biases on decision making. These include:
- Seeking out diverse perspectives: By exposing oneself to a wide range of viewpoints, it is possible to reduce the influence of confirmation bias and other cognitive biases.
- Seeking out disconfirming evidence: By actively searching for evidence that may contradict one’s beliefs or hypotheses, it is possible to reduce the influence of confirmation bias.
- Using probability estimates: By quantifying the likelihood of different outcomes, it is possible to reduce the influence of the framing effect and other cognitive biases.
- Seeking out feedback: By seeking out the opinions of others and soliciting feedback, it is possible to reduce the influence of overconfidence bias and other cognitive biases.
Overall, cognitive biases are a natural part of human cognition, and it is important to be aware of them and to take steps to mitigate their impact on decision making. By doing so, it is possible to make more logical, rational decisions and to avoid the pitfalls of irrationality.
