Cognitive Biases

Abstract

We will identify planning pitfalls, and cognitive biases facing an organization as well as how they can result in poor strategy. We will also look at the seven characteristics of good strategic leaders.

In the business world it is important to try and avoid the many planning pitfalls that are often overlooked. Two of these that I have experienced in my professional career are: Overlooking the planning process, and planning meetings poorly.

Many executives do not spend enough time in planning their firm’s short term and long term goals and strategies. This can happen for many reasons, but in my example it’s due to a lack of time management and awareness of its importance. As a solution all leaders and executives should set aside at least 5% of their time weekly for the critical issue of planning. Once you have done that it is critical to manage your agenda effectively.

Planning meetings poorly is perhaps one of the most common pitfalls seen in businesses that I have been a part of. Many of us have heard about pointless meetings, or meetings about meetings, or meetings before or after other meetings. This is all unfortunately very common. It is imperative that you prepare an agenda and stick to it based on the issues that must be addressed. Making sure that all participants have a copy of the agenda in advance can also be helpful to prepare them as well. If everyone has a chance to get their thoughts together about the main issues at hand it can help to be more productive. Starting and ending on time are also critical to maintaining productivity for everyone involved.

Cognitive biases are a common reason that businesses fail. Two of the ones that I have seen occur are “Escalating commitment” and “illusion of control.” Escalating commitment is when decision makers, having committed significant amount of resources to a project will continue to move forward despite the fact