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Every leader likes to think they make sound, rational decisions. Yet history is littered with examples of great companies—run by smart, experienced leaders—that made catastrophic mistakes. These weren’t random flukes. They were the result of predictable decision traps—cognitive biases that distort judgment and lead even the best leaders astray.

Take, for example, the New Coke disaster of 1985. Coca-Cola, facing pressure from Pepsi’s growing market share, reformulated its iconic soda based on taste tests that seemed to favor the new version. What they didn’t anticipate was how deeply customers were emotionally attached to the original formula. The backlash was immediate and fierce, forcing Coca-Cola to reverse course just 79 days later and reintroduce “Coca-Cola Classic.” It was a textbook case of the framing trap, where leaders focused too much on a specific metric (taste preference in blind tests) while ignoring the broader emotional and brand loyalty factors driving consumer decisions.

Or consider Yahoo’s series of disastrous business decisions in the 2000s. In 1998, Yahoo had the chance to buy Google for $1 million—but passed. In 2006, it could have acquired Facebook for $1 billion but hesitated. Later, it overpaid $1.1 billion for Tumblr, only to sell it for a fraction of that amount years later. These decisions were driven by a mix of hindsight bias (believing they could predict the next big thing) and overconfidence bias (assuming their existing dominance made them unbeatable). By failing to recognize these biases, Yahoo squandered its lead in the tech world and was ultimately sold off in pieces.

The lesson? If leaders don’t actively mitigate cognitive biases, they aren’t just risking poor performance—they’re putting their entire business at stake.

What Are Decision Traps?

Decision traps (also known as cognitive biases) are mental shortcuts that help our brains process information quickly. While these shortcuts work well in routine situations, they lead to serious errors in complex or uncertain environments. Some of the most common decision traps include:

• Overconfidence Bias – Assuming we know more than we do, leading to unrealistic forecasts and excessive risk-taking.
• Confirmation Bias – Seeking out information that supports our preexisting beliefs while ignoring evidence to the contrary.
• Anchoring Bias – Over-relying on the first piece of information we receive, even when better data becomes available.

The problem? These biases operate beneath the surface. Leaders don’t realize they’re falling into a trap until it’s too late.

The Good News: Training Works

The research paper Mitigating Cognitive Bias to Improve Organizational Decisions analyzed over 100 empirical studies and found that training is one of the most effective ways to mitigate decision traps. Here’s what the research revealed:

✅ Training on cognitive biases reduces errors. Studies show that when leaders and teams are trained to recognize biases, they make better decisions across a range of contexts.

✅ Training works especially well in complex, uncertain environments. The more unpredictable and high-stakes a situation, the more beneficial structured decision training becomes.

✅ The benefits of training extend beyond specific situations. Learning how to mitigate one bias in one decision improves decision-making in other situations, creating long-term gains.

✅ Training has lasting effects, especially when combined with feedback. The most successful interventions include structured decision reviews, where teams analyze past decisions and identify where biases may have crept in.

One particularly compelling study found that leaders who underwent bias awareness training improved their decision-making for months after the training ended—especially when they had structured opportunities to reflect on past decisions.

How Enabling Empowerment Helps Leaders Avoid Decision Traps

At Enabling Empowerment, we don’t just teach leaders about decision traps—we give them a practical, structured framework for making better decisions. Our 7-Step Decision-Making Framework (DMF) is specifically designed to help leaders navigate complexity and uncertainty.

✅ Steps 1-6 of the DMF guide leaders through structured decision-making, ensuring they identify key drivers, consider alternatives, and manage risks.

✅ Step 7: Show Your Work is designed specifically to support structured decision reviews—one of the research-backed methods for reinforcing training effects over time.

By implementing the DMF, leaders not only make better decisions today but also build a culture of continuous improvement, where teams actively reflect on past choices to avoid repeating the same mistakes.

Want to Learn More?

If you’re serious about mitigating decision traps in your organization, we have two great resources for you: 📖 The Hidden Traps Sabotaging Your Decisions – A practical guide to recognizing and avoiding common decision biases. 📘 Enabling Empowerment: A Leadership Playbook for Ending Micromanagement and Empowering Decision-Makers – A deeper dive into our Decision-Making Framework and how leaders can build better decision-making habits.

Don’t let decision traps dictate your company’s future. Invest in decision-making training today and build a stronger, bias-resistant leadership culture.

For further insights into decision-making frameworks and avoiding common decision traps, check out our other blog articles and subscribe to our newsletter.

If you’re interested in more practical strategies for overcoming decision traps, check out my book Enabling Empowerment, where I go deeper into these concepts.  It is also available in audiobook format on Audible.

Don’t have time to read the book?  Check out this 22-minute pre-recorded webinar on Spotting and Sidestepping Decision Traps.

Still not enough time?!?  Ok….here is an awesome interview by Jon Franko of the Manufacturing Employer Podcast that you can listen to in your car!

Chris Seifert is the author of Enabling Empowerment: A Leadership Playbook for Ending Micromanagement and Empowering Decision-Makers. With over two decades of experience in transforming organizations through strategic leadership and decision-making frameworks, Chris has helped teams cut through bottlenecks, optimize capital project budgets, and build cultures of accountability. He is passionate about teaching leaders how to empower their teams to make smarter, faster decisions without sacrificing business value.