Cognitive Biases: Decision Making, Beliefs and Business Operation


Decisions... Decisions... Decisions... Sometimes our brains aren't very good at making them and this can impact how businesses run. This third infographic in our Cognitive Biases series shows just how easy it is for businesses to fall into these traps.

decision making belief biases

As a part of our cognitive biases series, we had a look at some of the decision-making biases that impact the way businesses operate. Our beliefs affect the way we make decisions on a day-to-day basis, sometimes without realising what we are doing.

We picked out five of our favourite belief and decision-making biases that can impact workplaces.

Bandwagon Effect

Everybody loves jumping on a bandwagon and its momentum can be very hard to stop. The bandwagon effect occurs when individuals begin to do, say or believe things just because everyone else is doing the same.

If the concept of a project is gaining popularity during a discussion, there is a chance that large flaws will be overlooked to accommodate for the idea. There will be a tendency to make sure the project can come to life, even if there are some barriers that can’t be avoided.


There’s a reason sheep aren’t running the world. The want for agreement in a group can often lead to poor decision making. If everyone is agreeing, critical thinking and improvement go out the window.

If promoting harmony is of more value to the group than thoughtful discussion, the rate of poor decision making rises. If everyone is agreeing with what is being discussed for the sake of agreeing, flaws will not be identified and addressed.

Sunk Cost Fallacy

You’ve already spent time and effort on a project, so you may as well finish it. It’s a waste of time if you don’t, right? Wrong! The sunk cost fallacy occurs when extra effort, time or money is committed to a current project, simply because it has already been invested in.

This kind of thinking can often lead to a massive amount of over-expenditure in projects, even if there will be less money lost if the whole project is scrapped altogether. This is common with food, too. Often, when people are full from eating at a restaurant, they will finish their meal despite the fact they will feel worse. They feel like it will be a waste if it isn’t finished, but the money has already been spent and nothing will be lost by leaving the meal unfinished.

Status Quo Bias

It’s a very powerful movement that refuses change, and we aren’t talking about the band! The status quo bias is the tendency resist change and have everything stay the way it is.

Conservative political ideologies can be attributed to the status quo bias but it also influences working life. Whether it be a reluctance to new technology in the workplace or an unwillingness to change standard procedures, the tendency to reject change is a strong one with a lot of people.

Semmelweis Reflex

Have you ever presented facts and evidence to support your argument, only for the other side to deny it anyway? Of course you have. The Semmelweis reflex is when new evidence that challenge existing norms are rejected.

During the mid-1800’s, Ignaz Semmelweis discovered that doctors washing hands between patients could reduce the chances of childbed fever dramatically. Despite evidence suggesting that washing hands could severely reduce mortality rates, many doctors denied Semmelweis’ claims. At times, we can get caught up in what is considered normal and completely reject founded claims that contradict our beliefs.

Businesses can sometimes get caught up in these biases, so it is always helpful to take a step back and ask yourself why certain decisions are being made. It improves the rate of good decision making, and consequently, the overall productivity output.