It’s no surprise that factors such as cost, and the availability of skilled workers, can stall the pursuit of digital strategies. More surprising, however, was the observed inertia around technology (especially at times that necessitate digitalization to remain agile), which can be explained by psychological factors holding business leaders back.
For business owners and leaders tasked with driving digital strategy, it is their perception of risk that is more impactful on success than anything else. Deciding to incorporate digital tools or infrastructure can be daunting because of the unknown it represents, but shying away from the process can be a far riskier path. By understanding the psychological barriers behind digital decision-making, industry stakeholders can and should encourage technology adoption in small and medium-sized businesses — in doing so, they will strengthen the backbone of the global economy.
Human decision making is a complicated phenomenon. Many studies on the topic highlight the parameters defining our mental processes, even if they can’t fully explain them. These studies often find that we can be guided towards an outcome that we know is against our best interests. And this is the case in business, too.
It’s easy to view corporate decision making as something steeped in careful consideration — a binary process led by data and best practice. However, businesses are ultimately run by humans. Commercial progress is determined by the choices that we make, either alone or as a group.
As a result, the unpredictability of the human brain can influence a range of business decisions. This is even more pronounced when processing the outcomes of technology-related decisions, which teases out every dimension of our psyche. This is because for lots of companies, especially small and mid-sized firms, new tech is still very much a leap into the unknown.
Complete Article at HBR
