Study Reveals the Power of Visuals in Strategic Decision-Making

Study Reveals the Power of Visuals in Strategic Decision-Making

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A new study published in the Strategic Management Journal has shed light on the pivotal role of visual representations in strategic decision-making (SDM). The research, conducted by Felipe A. Csaszar, Nicole Hinrichs, and Mana Heshmati, reveals that visuals, such as diagrams, charts, and graphs, significantly enhance managers’ cognitive abilities, leading to better strategic choices.

Four key cognitive functions 

Study Reveals The Power Of Visuals In Strategic Decision-MakingThe study identifies four key cognitive functions that are boosted by the use of visuals: working memory, long-term memory, pattern recognition, and knowledge transfer and transformation. By offloading information onto visual representations, managers can free up mental resources for analysis and communication, recall crucial information more easily, identify patterns and trends in data, and effectively share knowledge with others.

The research also highlights the importance of “representational capability,” a manager’s ability to select, populate, and monitor the effectiveness of visual representations. Managers with higher representational capability are found to be more adept at generating problem spaces with higher satisfiability and smaller size, ultimately leading to superior decision-making outcomes.

Usability and malleability keys for Strategic Decision-Making

Furthermore, the study emphasises the significance of two key characteristics of visual representations: usability and malleability. Usability refers to the ease with which information can be extracted from a visual, while malleability refers to the degree to which a representation can be modified by its users. The research suggests that the optimal level of malleability depends on the manager’s representational capability, with highly capable managers benefiting from more malleable representations.

The study’s findings have significant implications for educators, consultants, and managers alike. By recognizing the power of visuals in strategic decision-making, these professionals can leverage visual tools to enhance cognitive processes, improve communication, and ultimately make better strategic choices. The research also underscores the importance of developing representational capability among managers to maximise the benefits of visual representations in strategic decision-making.

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