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Related Experiment Videos

Decisions without blinders.

Max H Bazerman1, Dolly Chugh

  • 1Harvard Business School, Boston, USA. mbazerman@hbs.edu

Harvard Business Review
|February 2, 2006
PubMed
Summary
This summary is machine-generated.

Bounded awareness, or cognitive blinders, prevented doctors from fully recognizing Vioxx risks, leading to continued prescriptions despite available evidence. Mindfulness is key to overcoming these decision-making limitations.

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Area of Science:

  • Decision-making science
  • Cognitive psychology
  • Organizational behavior

Background:

  • The Vioxx drug withdrawal in 2004 highlighted a significant gap between available risk information and continued prescription rates.
  • An estimated 25,000 heart attacks and strokes were linked to Vioxx, despite early evidence of its dangers.

Purpose of the Study:

  • To explain the phenomenon of bounded awareness and its role in decision-making failures.
  • To examine how cognitive blinders prevent individuals and organizations from perceiving and utilizing critical information.
  • To offer strategies for enhancing awareness in executive decision-making.

Main Methods:

  • Analysis of the Vioxx case to illustrate bounded awareness in practice.
  • Examination of other organizational failures (e.g., Challenger, Citibank Japan) as examples of bounded awareness.

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  • Review of the three stages where bounded awareness impacts decision-making: information seeking, information use, and information sharing.

    • Main Results:

    • Bounded awareness, characterized by cognitive blinders, limits the perception, utilization, and sharing of relevant information.
    • Physicians prescribing Vioxx may have overlooked risks due to positive patient feedback, demonstrating a failure to use available information.
    • Organizational awareness can be limited when information is not sought, used, or shared effectively among members.

    Conclusions:

    • Bounded awareness is a critical factor in significant decision-making errors, even when information is accessible.
    • Mindfulness and a conscious effort to broaden focus are essential for executives, particularly when potential damages are severe.
    • Implementing strategies to increase awareness can mitigate risks associated with bounded awareness in critical decisions.