CHAPTER 1

What Are Heuristics?

(Rules of Thumb)

A rule of thumb (termed “heuristic” hereafter)i is a description of an informal or a formal problem-solving process not necessarily 100 percent reliable.

Vignette: The Merger Fiasco

As the CEO of a technology company, I had to consider a number of merger or acquisition opportunities. These were often potential avenues for sources of growth capital. I found these opportunities challenging. On one hand, their appeal was high because they implied significant infusion of additional operating funds, something my growing company was always in need of; controversially, those potential ventures could involve loss of control, or a cultural change with the transformation that would most certainly follow a ...

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