DUE DATE FOR THE FOLLOWING QUESTIONS- 9/24/2013
KPMG Chapters 4 & 5: Identify 5 judgment tendencies that might lead to biased judgments (Ch. 4). For each tendency identify a way to mitigate or overcome the biased judgment. (Ch. 5).
Availability tendency- The tendency for decision makers to consider information that is easily retrievable from memory as being more likely, more relevant, and more important for a judgment. A way to mitigate bias to this tendency is by using awareness, consider why something comes to mind, make the opposing case, consult with others, and obtain and consider objective data.
Confirmation tendency- The tendency for decision makers to seek for and put more weight on information that is consistent with their initial beliefs or preferences. To mitigate the bias caused by this tendency we must be aware of the tendency, make the opposing case, consider alternative explanations, and Consider disconfirming or conflicting information.
Overconfidence tendency- The tendency for decision makers to overestimate their own abilities to perform tasks or to make accurate diagnoses or other judgments and decisions. The way we can mitigate bias of this this tendency is by being aware, challenging expert or advisors estimates, challenging extremely high or low estimates, and challenging underlying assumptions behind the estimates.
Anchoring tendency- The tendency of decision makers to make assessments by starting from an initial numerical value and then to adjust insufficiently away from that initial value in forming a final judgment. We can mitigate bias of this tendency by being aware of significant anchors, making an independent judgment or estimate, consider alternative anchors based on relevant and supportable benchmarking information, and Solicit input from others, and be careful to not provide an
