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Clock-Crunching Decisions
Time pressure or clock crunching leads to faulty decision-making and bad choices. Time restraints put added stress on the decision-maker and often times force a person to make a judgment based on incomplete analysis. When a quick decision needs to be made it is often a bad choice.
Over-Confidence
While confidence is good in many situations, having too much confidence can work against you when it comes to making good decisions. The over-confident person sometimes feels that his or her actions will influence a situation and the outcome will be positive.
Many times people are blinded to alternatives and other points of view because of over-confidence bias. This type of individual is often surprised to learn that their probability judgments are incorrect and their ability to accurately predict outcomes is unrealistic.
Sunk Costs Bias
The fear of wasting money and time invested in a project often prevents us from looking at the project objectively. Mangers will often ignore the problem or progress of a project.
For example; you're leading a team and $500,000 has been sunk into a project that is not delivering on its promises.
· Choice one: you scrap the project and start again.
· Choice two: you sink additional money, time and company resources, hoping that the project will deliver.
In most cases, because of sunk costs bias, choice two is the road that is followed. In hindsight you knew the project was doomed for failure. As foolish as this appears -- this scenario is all too real.
Source: Deanne DeMarco, MA, RCCI, is an award-winning trainer and certified business coach. She is also the author of several books including Pocket Resource: Coaching Tips and Speaking of Success.
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