Decision Making and Sequential Sampling †Free Samples to Students

Question: Discuss about the Decision Making and Sequential Sampling. Answer: Introduction Decision making is one of the primary activities of human life. All kinds of people make decisions in their different capacities, whether the professionals, non-professionals, the families, children or any other category of individuals. Humans tend to be biased in the process of decision-making. Usually, bias results from the psychological and environmental. Some of these factors include their motives or intentions, the information level on the subject among others. Humans expect a positive outcome from the decision-making process; however, in cases where the process is biased, the results may also be biased. It is important that the person making a decision avoids all forms of influence from all possible factors. There are many different types of decision-making scenarios that happen in our daily life. These scenarios can help us understand the various concepts of bias and their respective methods of measure or evaluation of their extent. The scenarios also help us understand the strategies that can be employed and how they can improve the decision-making process. Thus, these situations act as example cases which can be applied to other real-life cases for efficient making of decisions. Confirmation bias is where a decision maker selects information which seems fit and suited for them. In the process, the decision maker ignores the evidence available or any other information that may prove the decision otherwise, but rather, focuses on the information of interest. The bias ignores the data that exist and works with assumptions. It supports the existing hypothesis yet rejects the information that supports that assumption (Mayew Venkatachalam, 2012). Thus, the parties involved tend to base their decisions on the assumptions. There are many cases where people have their decisions influenced by the confirmation bias (Rabin Vayanos, 2010). In a scenario to bring out the confirmation bias, a male chauvinist may argue that women are the main causes of breakages in marriage. One may claim that the root of cause of issues in marriage is caused by women. In this, bias is clearly brought out through making claims that have not been proved by statistical data. In this case, the opinion may be valid or not. However, the decision maker is only basing the decision on the assumptions. This is because they have not considered existing informational data to help them make the decisions. The confirmation bias in this scenario can be measured by the extent to which the extent of the statement with the existing information on the marriage breakages in the society. Some of the strategies to handle confirmation bias in the scenario are through seeking sufficient information before making a decision. Lack of enough data on the subject leads to confirmation bias among the people involved (Baron, 2007). Also, a strategy to overcome confirmation bias, people should be open-minded in the sense that they are free to allow other people's comments, opinions, and views. When people give their feedback to the discussion, there are little chances of occurrence of confirmation bias (Brunton, Botvinick Brody, 2013). These strategies are necessary, and they are likely to help cut reduce the bias in the decision-making process to a large extent. Anchoring Bias The anchoring bias refers to a case where the decision maker decides on the specific information gained during making the decision. One is in a hurry of concluding without giving it a thought or a second chance to get further information. The prevailing information can be time misleading and makes people fall victims of making wrong decisions out of the anchoring information (Shadle Shohamy, 2016). Usually, this kind of information is characterized by being incomplete and does not give an accurate reflection of the prevailing scenario which is enough to make a sound decision. Therefore, anchoring information is misleading and makes people fall victims of the circumstances due to biased information from this knowledge (Thaler, Sunstein, 2008). In a scenario to convey the anchoring bias, a farmer acquires fertilizer and applies to his crops, then expects the crops to grow faster. The farmer strongly believes that when they apply fertilizer to the crops, they will grow faster. The belief and decision is made without any consideration of other factors such as the amount of rain or any climate change, the time of application, the crop variety and many other factors. Usually, the anchoring bias makes the buyers to be moved by the first impression of the product such as its price and whether it has ever worked before. This kind of bias can be measured or evaluated by the amount of anchoring information that people will need before making a decision. Some of the strategies that can be employed to overcome the anchoring bias include the ability of the decision maker to remain patient enough to establish more information before making a decision (Ben-David, John Campbell, 2013). This will give them room to avoid making wrong decisions from the influence of the anchoring knowledge. Also, the decision maker should seek information from other different sources of information.Getting information from a variety of sources is important and helps people to avoid being trapped by the general first impression in the process of making a decision (Chugh Bazerman, 2007). The Heuristic bias The heuristic bias concept entails a state where people make decisions depending on the amount of information that has been retained in their memories regarding a given subject. These are remembrances and impressions that exist in the minds of people before making decisions are called the heuristics (Benartzi Thaler, 2007). Every human being has some level of knowledge or opinion on every subject. Thus, in this case, people will use their experience, stories and other readily available mind information to make a decision. Therefore, the effectiveness of the decision relies upon the knowledge base of the decision maker (Billet Yimin, 2008). In a scenario to depict the heuristic bias, people may argue that using a laptop has effect on our health. In this case, heuristic bias is demonstrated the effectiveness of the decision. Those who have more knowledge about laptops will have a better understanding of the effects of drinking and thus, make sound decisions. On the other hand, those who will have insufficient information will make wrong decisions (Keltner Lerner, 2010). Thus, this scenario reveals the biases that exist depending on the heuristics. The best strategy to overcome the heuristic bias is through examination of the knowledge that one presents over the subject before making a decision. People should be in a better position to look into the information or knowledge that they have before considering the way to take (Bazerman Moore, 2013). This will make decision makers to gather sufficient requirements for making a sound decision. People need to understand their level of knowledge and accept their position before the decision. They should not overestimate, underestimate or assume information that is important in making the decision, thus, reducing the biases due to heuristics. Therefore, the business leaders need to embrace these strategies to ensure that they make sound decisions (Hertwig, Hoffrage ABC Research Group, 2013). Conclusion In conclusion, it is critical to avoid biases in the process of making decisions. The unbiased decisions are essential for the management of business organizations to make sound decisions which help businesses to succeed. Different forms are biases that are exhibited during decision-making. Most of these kinds of bias are based on the specific scenarios of making decisions. Some of these decision-making bias concepts include the confirmation bias, anchoring, and the heuristic bias. It is important for the people to understand the scenarios of decision-making and thus, take appropriate strategies to ensure that they reduce bias in their process of making decisions to avoid unbiased outcomes. References Baron, J. (2007). Thinking and deciding (4th ed.). New York City: Cambridge University Press. Bazerman, M., Moore, D. (2013). Judgment in managerial decision making (8th ed.). John Wiley Sons Inc. Benartzi, S. Thaler, R. (2007). Heuristics and biases in retirement savings behavior, Ben-David, I., John, R. Campbell, R. (2013). Managerial Miscalibration. 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