HBR's 10 Must Reads Collection (12 Books)

Before You Make That Big Decision . . .

by Daniel Kahneman, Dan Lovallo, and Olivier Sibony

THANKS TO A SLEW of popular new books, many executives today realize how biases can distort reasoning in business. Confirmation bias, for instance, leads people to ignore evidence that contradicts their preconceived notions. Anchoring causes them to weigh one piece of information too heavily in making decisions; loss aversion makes them too cautious. In our experience, however, awareness of the effects of biases has done little to improve the quality of business decisions at either the individual or the organizational level.

Though there may now be far more talk of biases among managers, talk alone will not eliminate them. But it is possible to take steps ...