MIT Sloan Management Review Article on The Potency of Shortcuts in Decision-Making

How do CEOs make good decisions? At a time when senior leaders have access to more data and sophisticated analytics tools than ever before, the central challenge of making good decisions about hiring, product development, and resource allocation is increasingly not a lack of information. Rather, it is knowing how much information is enough, and how to use it.

Scholars of decision-making have long recommended that CEOs and managers gather and analyze comprehensive information before making choices. This advice is based on two assumptions: (1) More information leads to better understanding of the decision at hand and possible consequences, and (2) an emphasis on gathering information rather than relying primarily on one’s own knowledge may reduce harmful biases.

About the Author

Sebastian Kruse is an assistant professor in the Innovation and Entrepreneurship (WIN) group within the TIME research area at RWTH Aachen University in Germany. David Bendig is a full professor at the School of Business and Economics at the University of Muenster in Germany. Malte Brettel is a full professor at WIN and adjunct professor for entrepreneurship at WHU-Otto Beisheim School of Management.

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