NYU Stern
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Power, Confidence, and Decision-Making

By Kelly See, Assistant Professor of Management and Organizations and Elizabeth Morrison, ITT Harold Geneen Professor in Creative Management & Professor of Management and Organizations

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The decisions made by powerful individuals in business, government, and other important organizations arguably have some of the most serious and broad-reaching consequences for society at large.

Management researchers have now shown that people in power – such as CEOs or presidents of countries – tend to ignore advice when making decisions. Because powerful people tend to have more confidence in their own judgment, they are then less open to input from others, even if that advice could improve his performance.

In their co-authored paper, “The Detrimental Effects of Power on Confidence, Advice Taking and Accuracy,” NYU Stern Professors of Management Kelly E. See and Elizabeth W. Morrison and colleagues studied survey data gathered from hundreds of working professionals across a range of organizations and industries. They also conducted controlled laboratory experiments where people who were primed to experience varying levels of power were presented with advice from others and tasked with making decisions.

The results may not be surprising. For one, greater power reduced the tendency to take advice. Also, the main reason individuals with greater power discounted even valuable advice was because they had an elevated confidence in their own initial judgments.

These findings could explain, the authors point out, why leaders with responsibility to make important decisions often make calls that, in the best case, have observers scratching their heads.

Write Professors See and Morrison: “The decisions made by powerful individuals in business, government, and other important organizations arguably have some of the most serious and broad-reaching consequences for society at large. And yet the very power entrusted to those individuals may introduce a mindset that prevents them from taking advice, and thus from making sound decisions.”