UNAIR NEWS In today檚 fast-paced and highly adaptive business environment, many corporations continue to rely heavily on past experience, making it difficult for them to embrace change. Left unchecked, this tendency can evolve into a cognitive bias that often goes unnoticed.
Addressing this issue, Prof. Dr. Fitri Ismiyanti, S.E., M.Si., Professor of Behavioral Financial Management at 51动漫檚 Faculty of Economics and Business (FEB), identified overconfidence and inertia as particularly high-risk biases. She delivered these insights during her inaugural professorial lecture on Thursday (May 23, 2025), at the Garuda Mukti Hall, MERR-C Campus, UNAIR.
Corporate psychological traps
In her address, Prof. Ismiyanti explored psychological factors that negatively impact strategic decision-making within organizations. 淐ommon influences include denial and hubris among decision-makers, she said. According to her, these attitudes often lead to unrealistic decisions that fail to consider broader perspectives.
She further explained that overconfidence can cause decision-makers to overlook external variables and dismiss internal feedback. 淲hen leaders believe themselves to be infallible, they close themselves off from data and constructive criticism. Inertia, meanwhile, keeps companies stuck in their comfort zones, she said.
Prof. Ismiyanti argued that inertia is not just an operational obstacle攊t reveals a deeper inability to adapt to external changes and risks. In today檚 economy, agility is a crucial factor for maintaining competitiveness.
淭his pattern is evident in the slow digital transition of traditional retail businesses. By the time they adapt, emerging competitors have already surged ahead, she added.
Strategic solutions for bias
Prof. Ismiyanti stressed that addressing overconfidence and inertia requires a systematic strategy rooted in organizational culture. Key solutions include fostering diversity in decision-making, fully integrating data analytics, creating open spaces for dialogue, and conducting structured post-project reviews or “post-mortems.”
淎 wise leader doesn檛 just exude confidence but also welcomes feedback and routinely evaluates project outcomes, she noted.
She also introduced behavioral finance as a useful framework for analyzing irrational investment and financial decisions. Understanding psychological bias, she argued, is essential for shaping effective business strategies and governance models.
淏y recognizing the human behaviors behind numbers and data, companies can make decisions that are more realistic, inclusive, and adaptable to change, she concluded.
Author:
Editor: Khefti Al Mawalia
