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strategic decision-making
Also known as: strategic decision-making, strategic decisions, strategic decision process
Facts (19)
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The Impact of Cognitive Biases on Professionals' Decision-Making frontiersin.org 18 facts
accountHodgkinson et al. (1999) investigated the effect of framing on strategic decisions using an experimental setting with undergraduate management students who were presented with a 500-word case vignette about a company that manufactured and distributed fast paint-drying systems.
quoteEisenhardt and Zbaracki (1992) define strategic decisions as 'those infrequent decisions made by the top leaders of an organization that critically affect organizational health and survival.'
referenceC. R. Schwenk published 'The cognitive perspective on strategic decision making' in the Journal of Management Studies in 1988.
referenceK. M. Eisenhardt and M. J. Zbaracki published 'Strategic decision making' in the Strategic Management Journal in 1992.
referenceC. R. Schwenk published 'Management illusions and biases: their impact on strategic decisions' in Long Range Planning in 1985.
claimThe framing effect and CEO overconfidence are two cognitive biases that have been studied quantitatively in the context of strategic decision-making.
perspectiveSome researchers argue that individual biases have limited relevance in strategic decision-making because strategic decisions are the product of organizations rather than individuals within a wider sociopolitical arena.
claimMaule and Hodgkinson (2002) argued that the claim that cognitive biases influence strategic decisions requires direct testing through laboratory research and experimental studies.
claimSchwenk (1988) identified ten heuristics and biases of potential significance in strategic decision-making: availability, selective perception, illusory correlation, conservatism, law of small numbers, regression bias, wishful thinking, illusion of control, logical reconstruction, and hindsight bias.
claimEarly research on strategic decision-making was based on a neoclassical framework that assumed strategists in organizations were rational actors.
referenceC. R. Schwenk published 'Dialectical inquiry in strategic decision-making: A comment on the continuing debate' in the Strategic Management Journal in 1982.
referenceT. K. Das and B. Teng published 'Cognitive biases and strategic decision processes: An integrative perspective' in the Journal of Management Studies in 1999.
claimStrategic decisions are characterized by a lack of structure, ambiguity, complexity, and an environment of risk and uncertainty, unlike recurring or routinized management decisions.
claimWhile the influence of cognitive biases on strategic decision-making is widely recognized, the empirical evidence supporting this connection is considered weak, with most existing research relying on narrative papers, documentary sources, and anecdotal evidence.
referenceC. R. Schwenk published 'Cognitive simplification processes in strategic decision-making' in the Strategic Management Journal in 1984.
referenceCharles Schwenk (1984, 1985) modeled the strategic decision process as consisting of three stages: goal formulation and problem identification, strategic alternatives generation, and evaluation and selection of alternatives, noting that heuristics and biases can affect decisions at each stage.
claimResearch on cognitive biases in strategic decision-making is scarce, likely due to a lack of ecological validity, which is considered an issue of primary importance in management research by Schwenk (1982).
referenceE. J. Zajac and M. H. Bazerman published 'Blind spots in industry and competitor analysis: implications of interfirm (mis)perceptions for strategic decisions' in the Academy of Management Review in 1991.
Strategic analysis of cyber conflicts: A game-theoretic modelling of ... securityanddefence.pl May 31, 2025 1 fact
claimGame theory provides a mathematical framework for modelling strategic decision-making processes and interactions among actors in the cyber domain, as demonstrated by analyses of cyber conflict cases from the 2000s.