Outcome Bias in Decision Making

Cognitive Bias
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Cognitive Bias > Best Practices

Gandhi Heryanto, Management Consultant, Indonesia
The fact that something worked doesn't mean it was the result of a correct decision, and the fact that something failed doesn't mean the decision was wrong (Howard Marks, Inspiration from the World of Sports Memo). OUTCOME BIAS When people are judging the quality of leaders’ decisions, they tend to focus much more on outcomes than intentions, a phenomenon that psychologists call "outcome bias". The outcome bias is costly to organizations. It causes employees and leaders to be blamed for negative outcomes even when they had good intentions and used a thoughtful decision-making process, considering all the information that should be taken into account. Organizations and their leaders can benefit from understanding how to help individuals look beyond end results. REDUCING OUTCOME BIAS Ovul Sezer and Max Bazerman of Harvard, Ting Zhang of Columbia and Francesca Gino decided to investigate potential ways to eliminate (or at least reduce) the outcome bias. In a series of studies, wh (...) Read more? Sign up for free

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