ABSTRACT
This chapter discusses some myths around the rationality of human decision-making. A model of two processes is provided through which the brain makes decisions: one automatic, the other more laborious and thoughtful. The chapter deals with a discussion about a number of biases that are most identifiable in organizations both prior to and during the project or program management life cycle, including optimism bias, loss aversion bias, and others. It provides an examination of a number of the more recognizable biases that project or program managers and teams will regularly encounter throughout their working careers. The chapter also provides a discussion of a specific method, reference-based forecasting, for mitigating the adverse effects of these biases in developing initial project estimates. The project or program manager and team members are constantly taking shortcuts that are inevitably counterproductive and place even greater stress on team members and stakeholders, much of which is due to the automaticity with which the human brain works.
