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Improving Judgments Project

Final Report Summary - KJ-IJP (Improving Judgments Project)

Decision-makers are often required to make subjective judgments about situations under uncertainty and imperfect information. For example, organizations operating across several countries need to predict currency exchange rates or need to decide how to expand their markets, and need experts to make these predictions using a combination of objective data and subjective judgments. Or, there could be issues that involve ethical dilemmas, which might have consequences at a personal, organizational or a societal level. At the same time, research has shown that human beings are “boundedly rational”: that is, they use various heuristics and rules-of-thumb to arrive at judgments. And in many cases, these shortcuts can lead to systematic biases that can severely undermine the accuracy of decisions.

This research program aimed to study the underpinnings of individual and group subjective judgments. We took an inter-disciplinary approach towards this by looking at individuals in their role as consumers, employees, managers, and citizens. We also looked at organizations, policy-makers, and society to create a holistic understanding. In order to do so, we first focused on how people actually make judgments and decisions. Specifically, we looked at how judgments are influenced by different decision-making frames, personality traits, and emotions, and how these affect judgment quality in an interpersonal context. Secondly, we worked on prescriptive aspects as well – that is, we proposed and tested various nudges and interventions that could help make better decisions.

During the grant period, we worked on several sub-streams related to this overall objective. In the last four years, the principal investigator along with her team of researchers have produced latest cutting-edge research in the field. For example, business ethics has become an important topic of concern for both practitioners and academics. Corporate scandals arising from employee misconduct often dominate the headlines and can result in significant consequences. We explored and found that unethical behavior by employees within organizations is significantly exacerbated under relative performance evaluations schemes wherein employees are evaluated compared to others. These and other related findings on the topic were published in Human Resource Management, a top-tier management journal. In another sub-stream we studied the role of emotions on advice-taking and feedback behavior within organizations. We found that anticipated regret, an important future-looking emotion that can have impact on the decisions in the moment, reduces the tendency for people to consider others’ advice and feedback. We published these findings in another top-tier management and decision making journal, Journal of Behavioral Decision Making.

Moreover, several other working papers are in the process of academic review with top-ranked journals such as Harvard Business Review, Journal of Business Ethics and Journal of Consumer Research. Several academic activities such as workshops, seminars, and academic visits were also conducted that helped develop collective capabilities at the host institution. We mentored several PhD students successfully, launched new training courses on research methods, and conducted monthly research seminar series. In all these activities, inter-disciplinary work that helped advance research competence and capabilities of the host institution has been emphasized. Data collection has involved approximately 5000 participants. We also developed several collaborations with academics from institutions in other geographical regions such as in China, India, Netherlands, Israel, Singapore, and Greece. Within IE, an interdisciplinary group called CRUDE -Centre for Risk, Uncertainty, Decisions, and Experiments – has been created with the efforts of the Principal Investigator. This will continue to develop the research in the field.

Apart from academic journals, the principal investigator has been extensively involved with dissemination activities with corporations and mass media. For example, the principal investigator wrote a weekly column with a daily financial newspaper and created multiple videos for the purpose. It is worthwhile to note that Thinkers50, a London-based think tank, has recognized the Principal Investigator as one of the top academic scholars who have the ability to shape management theory and practice. As a result, the work conducted under the grant has gained visibility and been recognized by various stakeholders.

All these activities under the grant have allowed the Principal Investigator to contribute very well to the academic community. New research streams and connections have emerged that will help the host institution further advance scientific investigations. Principal Investigator’s career has advanced tremendously. For example, she has now been appointed on the Editorial Board of the prestigious Journal of Behavioral Decision Making. She has established herself as a well-respected authority on the topics of risks, uncertainty, and decision-making especially in organizational contexts. In 2017, the Spanish education ministry granted her the prestigious Sexenio recognition. In all, our project has been a success and we would like to thank the European Union for the support.