Business management knowledge hub

Decision making

Common biases in decision making

In general there are three general heuristics namely availability, representative and confirmation heuristics. They encompass eleven specific biases.

Cognitive bias

Economists claim individuals are rational decision makers. They collect a lot of information, examine all alternatives and make decisions that maximise personal satisfaction. However, we do not make decisions in…

Heuristic definition

Individuals rely on rules of thumb (heuristics) to lessen the information processing demands of making decisions.

Availability heuristic

The inferences we make about event commonness based on the ease with which we can remember instances of that event.

Retrievability bias

We are better at retrieving some subjects from our memory than other things. Individuals base judgement on commonality and easier base strategies.

Base rate fallacy

People tend to ignore background information relevant to the problem such as base rate. We tend to assume that causes and consequences are related.

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Entrepreneurship

Sources of finance

There are different sources of finance: savings, friends and family, crowdfunding, business angels, venture capitalists, corporations and other.

Types of financial statements

Three financial statements are described in this article: balance sheet, income statement, statement of cash flow. Learn more here.

How to write a business plan?

Business plan allows the founder to crystallise business ideas, thinking through the problems that they will face before having to cope with it.

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Emotional intelligence

Multiple selves theory

Decision making is a cognitive process. Humans make errors because of motivational and emotional influences. Learn more about multiple selves here.

Hyperbolic discounting definition

Economic concept of discounting states that any choice that involves a trade off between current and future benefits should discount the future.

Self-interest bias definition

Perceptions and expectations are biased in self-serving manner. When presented with identical information, we perceive situation in different ways.

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Leadership

5 derailed leaders archetypes

The five types are: Imposters, who lack self-awareness and self-esteem; Rationalisers, who deviate from their values; Glory seekers, who are motivated by seeking the world’s acclaim; Loners, who fail to…

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Management

Strategic thinking skills

Understand the strategic relevance of your own activities, know how to think strategically, play the strategy game, understand the nature of strategy.

Problem solving skills for managers

Find the right problem, find the problem owner, use your experience, avoid the perfect solution, stay future-focused, keep it simple and other.

How to solve problems

A workable solution is preferable to the perfect solution because it leads to action. The perfect solution is the enemy of the practical solution.

How to influence decisions

Anchor the debate on your terms, build your coalition, build incremental agreement, size the prize, frame the decision favourably. Learn more here.

Decision making practice

Ask yourself three questions: is there a pattern I recognise here, who does this decision matter to, and why, does someone know the answer anyway.

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New product development

Reasons for new product failure

The failure of a product idea to be developed into a product is not necessarily a bad thing. It may save the company enormous sums of money.

New product launch

Most new products are improvements or minor line extensions and may attract almost no attention. Other products will receive extensive coverage.

Product prototype

The item acquires a finite form and becomes a tangible good. Product designers may develop similar prototypes with different styles.

Product concept

Transforming a list of ideas into product concepts. For a product idea to become a new product concept, these are required: form, technology, need.

New product development management

Well-functioning global NPD teams become a critical capability by which firms can leverage much more diverse set of perspectives for the global NPD effort.

New product development models

Department stage models, activity stage models and concurrent engineering, cross-functional models, decision stage models and other.

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