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Reducing Biases in Cross-Cultural Top Management Team Decision-Making Processes

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  • David Strutton
  • William Carter

Abstract

Cross-cultural top-management-teams (cc-TMTs) are typically comprised of rational individuals. Yet cc-TMTs featuring uniformly wise and experienced executives often make irrational decisions (i.e., choices incompatible with reason or logic). Even most executives acknowledge this is true. Behavioral economics suggests a primary reason why is that iterative combinations of cultural and cognitive biases invariably arise and interact in cc-TMT settings. As they arise, these biases often undermine the rationality of decision-making processes used inside teams. The impact of such biases surely intensifies if they remain unacknowledged - and thus unmanaged. From an example of Sino and Anglo cc-TMT interactions, six guidelines intended to reduce bias are developed. These approaches, and the analysis preceding them, explain the nature and scope of these cultural and cognitive biases, how and why they arise, and what actions executives might initiate to negate these biases¡¯ potentially irrational influence on decision-making processes by consolidating divergent biases to secure mutual gain within cc-TMT settings. Cultural and cognitive biases hardly explain everything, but they explain enough of what happens inside cc-TMTs that ignoring their influence is foolish. This article offers a logical footing from which to begin this important task.

Suggested Citation

  • David Strutton & William Carter, 2013. "Reducing Biases in Cross-Cultural Top Management Team Decision-Making Processes," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 4(3), pages 1-13, May.
  • Handle: RePEc:jfr:ijba11:v:4:y:2013:i:3:p:1-13
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    References listed on IDEAS

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    Cited by:

    1. Johanna Bragge & Henrik Kallio & Tomi Seppälä & Timo Lainema & Pekka Malo, 2017. "Decision-Making in a Real-Time Business Simulation Game: Cultural and Demographic Aspects in Small Group Dynamics," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 16(03), pages 779-815, May.

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