Buy or sell? Merge or split? Increase client quotas in the first quarter? These are some of the tough decisions business men and women make on a daily basis. Besides staying focused, it can be difficult to keep a level head amid business world's rapid pace. It's important to avoid knee-jerk reactions and instead sift through problems to reach the appropriate, shrewd solution.
The findings, published in the journal Psychological Science in a paper titled "Debiasing the Mind Through Meditation: Mindfulness and the Sunk Cost Bias," found that 15 minutes of mindful meditation can help us think more rationally and make more profitable choices.
One of the authors of the study, INSEAD PhD student Andrew Hafenbrack, specifically focused on how finding that inner calm helps negate the "sunk cost bias," which in economics refers to past costs that have been to incurred in a project and cannot be recovered. Previous research shows that this can inhibit the decision-making process. However, economists point out that sunk costs should not affect the rational decision-maker's best option.
INSEAD assistant professor Zoe Kinias shared how business CEOs and the bosses calling the shots can fight off this effect.
"First, meditation reduced how much people focused on the past and future, and this psychological shift led to less negative emotion," Kinias told Psychological Science. "The reduced negative emotion then facilitated their ability to let go of sunk costs."
For the study, the researchers split participants into two groups. The first group listened to a 15-minute recording by a mindfulness coach who guided them through a focused breathing meditation. The other group listed to a recording that asked them to think of whatever comes to mind – which is not mindfulness meditation. Then the groups were given a variety of sunk-cost scenario questions, answering to questions about whether they focused on past, present or future and the corresponding emotions.
People in the first group had improved decision-making abilities, highlighting one of the many benefits of meditations.
Ilchi Lee, a master of meditation, underscores that mindfulness allows us to wash over impulsive decisions and reconnect with values that we deem important. In business, this can result in sink-or-swim differences.
"This tool is very practical," Sigal Barsade, management professor at The Wharton School, told Psychological Science. "Our findings hold great promise for research on how mindfulness can influence emotions and behavior, and how employees can use it to feel and perform better."