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Project Decision Making: Are Your Decisions as Rational as You Think?
- lorenaflorian0
- 6 hours ago
- 4 min read
The problem isn't always what managers don't know. It's how the mind processes what it does know, especially under pressure. Cognitive bias is a predictable feature of human judgement, and it shapes project outcomes far more than most organisations are willing to admit.
Experience does not remove bias
In project management, it is easy to assume that experience leads to better judgement. Senior sponsors have seen more projects, and experienced project managers are often quicker to recognise when something is going wrong. But experience does not make someone immune to poor decisions. In some cases, it can do the opposite.
Past experience can shape how managers interpret new information, leading them to rely too heavily on familiar patterns or assume that what worked before will work again. Research on cognitive bias consistently shows that expertise does not eliminate these tendencies.
A 2026 study at Georgia State University found that executives can accurately name their own biases and still repeat the same mistakes, because knowing about a bias and correcting it in the moment are entirely different skills. Interestingly, short-term thinking was identified as the single biggest driver of poor strategic calls, cited by 46% of respondents. Peloton, the fitness company best known for its exercise bikes is a valuable example. At the height of the COVID-19 pandemic's demand surge, Peloton committed more than $400 million to a new US factory, even as signs were emerging that growth was slowing. Its valuation later fell from around $55 billion to roughly $2 billion. The issue was not necessarily a lack of data, but whether the assumptions behind the investment were being challenged strongly enough as conditions changed.
Shortcuts Under Pressure
Bias thrives in conditions that are common to almost every project: incomplete information, tight timeframes, and pressure to commit. When a decision has to be made quickly and the full picture isn't available, the brain reaches for shortcuts rather than working through every variable from scratch.
Take anchoring. A project's first cost estimate, often produced early and with limited scope definition, tends to become the reference point for every conversation that follows. If that number was $500,000, then a revised estimate of $1.2 million after scope has tripled doesn't get evaluated on its own merits. It gets compared back to the original figure and treated as an overrun to be managed down, rather than a more accurate reflection of what the work actually requires. The anchor was never designed to carry that much weight, but it usually does.
Escalation of commitment works similarly. A $10 million system build that's clearly struggling by month eight should prompt a hard look at whether it's still worth pursuing. Instead, the fact that $6 million has already gone into it becomes the argument for continuing, even though sunk cost has no bearing on what the project is worth going forward. The original business case, written when far less was known, keeps getting reinterpreted to support the decision that's already been made rather than the one the current evidence points to.
Making Better Decisions Without Slowing Everything Down
Reducing bias does not require every management decision to become a lengthy review process. Small changes in how decisions are approached can make it easier to identify weak assumptions before they become expensive ones.
Before approving or continuing a project, managers can ask:
Project Decision Making: Questions to Challenge Your Assumptions
What information would change my view?
What assumptions are we treating as facts?
Are we explaining away evidence because it does not support the outcome we expected?
If this proposal came to us for the first time today, would we still support it?
Are we continuing because the future case is strong, or because of what we have already invested?
Another useful approach is to deliberately involve someone who has not been closely involved in developing the proposal. Distance can make it easier to question assumptions that have gradually become accepted within a team.
Managers can also revisit the original reasons for investment as a project progresses. If the market, technology, organisational priorities or expected benefits have changed, the business case should be capable of changing with them.
Changing course should not automatically be treated as evidence that the original decision was poor. Sometimes it is evidence that management has responded appropriately to new information.
Final Thoughts
Cognitive bias is not evidence of bad management. It is part of how people make decisions, particularly when information is incomplete and pressure is high. The greater risk is assuming that experience, seniority or access to more data somehow removes it. Good managers still rely on judgement. The difference is that they are willing to test that judgement, particularly when they feel most certain about the answer.
For organisations, this matters because project decisions accumulate. A slightly optimistic forecast or an assumption that goes unchallenged may seem minor on its own. Across a portfolio, those decisions can determine where significant amounts of time and money are ultimately spent.
Better decision-making therefore does not begin with eliminating bias, it begins with accepting that they exist and identifying when a decision deserves another look.
References
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