Psychology of “anchoring” in negotiations

Description

This Skill Bit shows that the anchoring bias, a cognitive phenomenon, profoundly impacts decision-making processes. Leveraging an initial piece of information, or anchor, people tend to overemphasize its significance, creating a mental benchmark. Despite its arbitrary nature, this anchor becomes the reference point for subsequent judgments. Difficulty arises in adjusting away from this anchor, leading to biased decision-making. Recognizing and mitigating the anchoring bias is vital in fields like marketing and negotiations, where it can profoundly influence outcomes.

Duration approx. 3 Min.

Tier: proficiency