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Decision-Making Warning Flag 1a – The Gambler’s Fallacy
“The Gambler’s Fallacy, also known as the Monte Carlo Fallacy, is the false belief that the probability of an event in a random sequence is dependent on preceding events, its probability increasing with each successive occasion on which it fails to occur.”
Gambler’s Fallacy
Wikipedia
Seated at a roulette table, a gambler must decide on what color to place his next bet, red or black. He knows there is a 50 percent chance of getting either red or black and that the first four spins of the wheel yielded all reds. The gambler reasons that because half of all spins should result in black and the first four were red, it is more likely the fifth spin of the roulette wheel will be black and places his bet. While his logic appears reasonable, the roulette player has just fallen victim to the Gambler’s Fallacy.
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Additional Information
Additional insight to the warning signs, causes, and results of logic errors can be found in the StrategyDriven website feature: Decision-Making Warning Flag 1 – Logic Fallacies Introduction.
Some personal power is organizationally bestowed. Others are self-earned. Each is effective when wielded in the proper place and time. Yet the absolute degree of influence each power differs greatly, dependent on the value offered which is further influenced by the circumstances surrounding the power’s use.
Landing the best jobs is often about who you know; from referrals to outright hires. But what happens when who you know is not the hiring manager?… Business Politics!
All too often it is not clear to executives and managers that they are in a decision-making situation. In many of these instances, they find themselves attending a briefing during which the presenter makes a recommendation for which he or she is seeking approval. As the presentation goes on, the briefing attendees listen attentively and nod silently. No verbal decision is communicated but the nodding continues. At the end of the presentation, the presenter is songs adulated for making a thorough presentation and providing an insightful recommendation. There is applause. Exiting the meeting, the presenter remembers the affirmative statements and, most importantly the silent nods. These now become the unintended affirmative decision the presenter sought and the leaders failed to recognize they were making.
Personal powers are the mechanisms by which one influences the actions of others. These powers are bestowed by the institution (formal powers) and self-acquired (informal powers).
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