Are hidden biases shaping your business choices?
When it comes to business decisions, adopting an objective perspective is crucial. However, separating your personal thoughts from the facts is not as straightforward as it sounds.
It is important to acknowledge the influence your personal views may have on your business and strive to minimise it.
What is unconscious bias?
Each of us holds a unique view of the world, influencing our everyday interactions. This perception is shaped by societal norms, personal experiences and individual personality traits.
This often leads us to make choices automatically, without deliberate thinking.
For instance, a new restaurant owner may not have a clear understanding of their ingredient requirements. To place an initial order knowledgeably, they will have to investigate common industry practices.
In contrast, an experienced owner can draw on past experiences and previous orders to make these decisions.
Sometimes, making a quick decision is necessary and the negative outcomes can be minor.
However, should you always trust your gut feeling for every decision? The simple answer is no. A biased approach to business decisions can negatively affect your strategy and overall success.
How can unconscious bias impact areas of your business?
Your biases can affect any decision you take part in, but there are critical areas to be particularly conscious of:
· Expanding your business – The fear of the unfamiliar can hinder your business’s growth. Staying within your comfort zone can result in missing the advantages of increasing your market presence.
· Risk assessment – Past setbacks can make you overly cautious, potentially causing you to miss out on valuable opportunities. Conversely, a history of successes may lead you to underestimate risks.
· Allocating resources – Even the most rational leaders can show unconscious favouritism, leading to disproportionate investment in certain departments or projects at the expense of others with lower returns on investment.
· Developing products – Is your product or service tailored to your preferences or those of your clients? Avoid the pitfall of designing your offerings based solely on your desires. Instead, consider your client’s needs and preferences.
· Decision-making – One significant bias to address is inclusivity in decision-making. Without a range of perspectives, the decision-making process can suffer from biased input, resulting in limited outcomes.
· Mergers and acquisitions – Deciding to sell your business is a major decision. You might lean towards buyers who share your values or vision, potentially overlooking more beneficial propositions.
How can you mitigate the impact of unconscious bias?
It is not feasible to completely eliminate unconscious bias. The key is to become aware of how your biases affect strategic decisions and to challenge these biases actively.
To adopt a comprehensive approach, step back and scrutinise the basis of your business decisions.
Even when relying on data, personal biases can taint the information you consider.
The most effective method to counteract bias is to seek a fresh viewpoint. Consulting with someone outside your business can provide valuable insights that you may lack.
A business adviser can offer an impartial perspective, utilising their detachment from the day-to-day operations of your business.
Additionally, you can draw on their experience in various sectors to enhance your business’s prospects. With their broad knowledge, a business adviser can contribute a wealth of insight to balance and fine-tune your strategic approach.
Don’t allow unconscious bias to interfere with your business. Get in touch with our team today for business support.