Unit 1 / Lesson 2 / Section 1.2.10.3    

The Power of Mindset in Entrepreneurial Success
Cognitive Bias & Risk

Lesson 2 — Cognitive Bias & Risk
Deepening Your Understanding

1.2.10.3. Required Readings

The following readings are selected to deepen your understanding of how cognitive bias shapes perception, judgment, and strategic behavior in entrepreneurial contexts. They are not intended to simply confirm the lecture, but to stretch, refine, and challenge your thinking through research-based and conceptual perspectives. Together, they illustrate how bias emerges, how reflective judgment develops, and how mindset influences whether we defend beliefs or seek truth.

Begin with Thinking, Fast and Slow — Daniel Kahneman (Chapter 7: “A Machine for Jumping to Conclusions”).
This chapter explains how the brain’s fast, intuitive system is wired to create coherent stories from incomplete information. Kahneman shows that our minds are “machines for jumping to conclusions,” quickly forming judgments based on limited cues and heuristics. Intuition is not inherently flawed, but it becomes dangerous when it operates unchecked in high-stakes decisions. This reading lays the foundation for understanding why cognitive bias is systematic and predictable rather than random — and why entrepreneurs must learn to slow down thinking when consequences are significant.

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Downloadable Resource
Thinking, Fast and Slow — Chapter 7: “A Machine for Jumping to Conclusions”
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Next, study Developing Reflective Judgment — Patricia King & Karen Kitchener (Chapters 4 and 6).
These chapters introduce and elaborate the developmental model of reflective judgment — how individuals evolve from viewing knowledge as certain and authority-based to recognizing complexity, uncertainty, and the need for evidence-based reasoning. King and Kitchener describe stages of thinking that move from simplistic, right–wrong frameworks toward more sophisticated, context-sensitive evaluations of claims and data. For entrepreneurial leaders, this model is critical: it explains why some decision-makers default to rigid certainty, while others can hold ambiguity, weigh multiple perspectives, and still act responsibly. The reading invites you to locate your own current patterns of reasoning and consider how to cultivate higher-level reflective judgment in your leadership.

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Downloadable Resource
Developing Reflective Judgment — Chapters 4 & 6
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Finally, read The Scout Mindset — Julia Galef (Chapter 2: “What the Soldier Is Protecting”).
This chapter contrasts two mental orientations: the “soldier mindset”, which is motivated to defend existing beliefs and protect identity, and the “scout mindset”, which is motivated to see the world as accurately as possible. Galef explains how, in soldier mode, we unconsciously treat reasoning like combat — attacking disconfirming evidence and defending our prior conclusions. This is especially dangerous for entrepreneurs whose identity may be tightly linked to their ideas, strategies, or early assumptions. The chapter demonstrates that adopting a scout mindset — valuing accuracy over emotional comfort — enables better strategic decisions, more honest self-assessment, and a healthier relationship with being wrong.

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Downloadable Resource
The Scout Mindset — Chapter 2: “What the Soldier Is Protecting”
⬇ Download Now

Approach each reading as a mirror, not a verdict. The objective is not to measure whether you “think correctly,” but to observe:

  • Where do I recognize fast, intuitive “jumping to conclusions” in my current decisions?
  • How do I typically treat uncertainty — something to eliminate quickly, or something to reason through reflectively?
  • In moments of disagreement or pressure, do I defend (soldier) or understand (scout)?

Use these texts to sharpen awareness of how your mind responds under pressure — and to begin building the cognitive discipline required for higher-quality entrepreneurial judgment.