Behavioral Influences in Strategic Decision Making

In this research stream, we investigate how behavioral factors influence strategic decision making. Our work is primarily rooted in the field of behavioral strategy, which merges insights from cognitive and social psychology with strategic management theory and practice. Behavioral strategy seeks to introduce more realistic assumptions about human cognition, emotions, and social behavior into our understanding of how strategic decisions are made in organizations.

When engaging with strategic decisions, it is crucial to understand how people process information, whether they rely on heuristics, and how such heuristics may vary across professions. In fact, certain expert heuristics can themselves represent a managerial capability, a way of simplifying complexity that contributes to more effective strategic decision making.

Our research in this area relies predominantly on laboratory experiments, in which we test how various information treatments influence strategic choices. In several subprojects, for instance, we examine cases where providing people with less information than theoretically required to solve a task can lead to better decisions. In another line of research, we explore how the nature of information, rather than its actual content, affects strategic decision making. Information may be presented in a more general and parameterized form, to aid individuals in detecting broad patterns, or in a highly contextualized form, resulting in grounding decisions in specific situations.

This research is primarily conducted by Johannes Luger, Johanna Rupp, Robert Janjic, and international coauthors.