Decision Making Biases And The Deepwater Disaster - 830 Words

Decision making biases played a devastating role in the Deepwater Disaster. The biases that were present are; representativeness heuristic, overconfidence bias, confirmation bias and escalation of commitment bias. Based on my findings, to some extent, each of the following biases contributed to the Deepwater Disaster. Representativeness heuristic, as stated in our text books is often used when people estimate the probability of an event occurring. It reflects the tendency to assess the likelihood of an event occurring based on one’s impressions about similar occurrences (Kreitner Kinicki, 2013). BP’s, confidence in its drilling success-rate, was partly to blame for the disaster. More importantly, based on the fact that, â€Å"offshore blowouts occur frequently—there were 173 in the Gulf of Mexico alone from 1980 to 2008—there had never been one in deep water. In fact, neither BP nor any of its competitors had proven equipment or technology or any backup plan for a catastrophic failure at great depth. Therefore, the industry did not develop an oil spill plan for the low probability, high- consequence event when everything fails, says Greg McCormack, director of the Petroleum Extension Service at the University of Texas. (Hoffman, 2010) According to (Kreitner Kinicki, 2013), overconfidence bias, relates to our tendency to be over-confident about estimates or forecasts. This bias is particularly strong when you are asked moderate to extremely difficult questions ratherShow MoreRelatedBp Deep Water Horizontal Explosion3148 Words   |  13 Pagesrepositioned BP as a â€Å"green† oil company after he took over and practiced the model of organizational decision-making strategy, known as â€Å"asset federation.† Under this new strategy, onsite asset managers had the authority to make decisions, and employees’ compensation was directly tied to asset performance (Ingersoll et. al, 4). Many decisions made by John Browne were directly related to the Deepwater Horizon explosion. In 2007, Tony Hayward replaced John Browne and became the new chief executive. TonyRead MoreIssue Management: Risk Management2957 Words   |  12 Pagessurprises? Bazerman and Watkins have identified five cognitive biases for t his question. â€Å"First, we tend to have illusions that lead us to conclude that a problem does not exist or is not severe enough to merit action. Second, we interpret events in an egocentric manner- we allocate blame and credit in ways that are self-serving. Third, we discount the future because it is easier to put off daunting measures today to prevent â€Å"far-off† disaster. Fourth, we cling on to the status quo. And fifth we onlyRead MoreStephen P. Robbins Timothy A. Judge (2011) Organizational Behaviour 15th Edition New Jersey: Prentice Hall393164 Words   |  1573 PagesPreface xxii 1 2 Introduction 1 What Is Organizational Behavior? 3 The Individual 2 3 4 5 6 7 8 Diversity in Organizations 39 Attitudes and Job Satisfaction 69 Emotions and Moods 97 Personality and Values 131 Perception and Individual Decision Making 165 Motivation Concepts 201 Motivation: From Concepts to Applications 239 3 The Group 9 10 11 12 13 14 15 Foundations of Group Behavior 271 Understanding Work Teams 307 Communication 335 Leadership 367 Power and Politics 411 Conflict and