The Decision-Making Flaw in Powerful People

Overflowing with confidence, many leaders turn away from good advice.

The decisions made by powerful people in business and other fields have far-reaching effects on their organizations and employees. But this paper finds a link between having a sense of power and having a propensity to give short shrift to a crucial part of the decision-making process: listening to advice. Power increases confidence, the paper’s authors say, which can lead to an excessive belief in one’s own judgment and ultimately to flawed decisions.

Previous research has shown that the quality of decision making declines when people hew too much to their own beliefs and discount too readily the advice of others; outside information helps “average out” the distortions that can result when people give a great deal of weight to their own opinions and first impressions. This paper is among the first to examine whether power — defined as an individual’s “capacity to influence others, stemming in part from his or her control over resources, rewards, or punishments” — reduces or increases a person’s willingness to heed advice.

Click here http://www.strategy-business.com/article/re00162 to read the full article from Booz & Company.