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2017/2018  KAN-CCMVI2058U  Strategic Decision-Making and Risk-Management

English Title
Strategic Decision-Making and Risk-Management

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration Summer
Start time of the course Summer
Timetable Course schedule will be posted at calendar.cbs.dk
Max. participants 60
Study board
Study Board for MSc in Economics and Business Administration
Course coordinator
  • Course instructor - Maitane Elorriaga Rubio, PhD fellow, Copenhagen Business School, mel.smg@cbs.dk
    Sven Bislev - Department of Management, Society and Communication (MSC)
In case of any academic questions related to the course, please contact the course instructor or the academic director, Sven Bislev at sb.msc@cbs.dk
Main academic disciplines
  • Management
  • Strategy
  • Business psychology
Last updated on 23/07/2018

Relevant links

Learning objectives
To achieve the grade 12, students should meet the following learning objectives with no or only minor mistakes or errors:
  • Demonstrate a clear understanding of the ideas/theories/concepts covered in the course
  • Be able to appropriately apply those ideas/theories/concepts to decision situations
  • Ability to recognize and work with common cognitive limitations and biases that affect human inference, strategic decision making, and risk management
  • Critically reflect on the inter-connections (and sometimes contradictions) between the different theories/perspectives, and apply that insight in analyses of strategic decisions and risks
Course prerequisites
Completed bahelor degree. Moreover, the student is expected to have a general knowledge on Management.
Strategic Decision-Making and Risk-Management:
Exam ECTS 7.5
Examination form Home assignment - written product
Individual or group exam Individual exam
Size of written product Max. 15 pages
Assignment type Project
Duration Written product to be submitted on specified date and time.
Grading scale 7-step scale
Examiner(s) One internal examiner
Exam period Summer, Ordinary exam: 26/27 June - 30 July 2018. Please note that exam will start on the first teaching day and will run in parallel with the course.

Retake exam: September - October 2018

3rd attempt (2nd retake) exam: November - December 2018

Exam schedule is available on https:/​/​www.cbs.dk/​uddannelse/​international-summer-university-programme-isup/​courses-and-exams.
Make-up exam/re-exam
Same examination form as the ordinary exam
Home project assignment, new exam question (72-hour home assignment)
Course content and structure

The quality of our judgment and decision making processes influences the economic, health, welfare and organizational outcomes that we (as well as others impacted by our decisions), experience. This course will provide students with a rich foundation in inter-disciplinary research that examines people’s
actual judgment and decision-making processes when faced with risk and uncertainty, as well as theoretical research that proposes normative models of how people ought to make decisions.

The research we will examine draws on insights from strategic management, as well as cognitive, experimental, social and organizational psychology. The course provides a foundational knowledge from the fields of business psychology and strategic decision-making. 

Students will learn and apply a variety of theories related to individual and group decision making, risk management and strategic management. In a nutshell, we will examine how emotions, cognitive limitations and biases, as well as competitive factors, affect risk perceptions, decision making and related behaviors.


Preliminary assignment: Students will have a preliminary assignment before the course starts, where they will be asked to think about real-life risky decision-making examples before attending the first session.

Class 1: Introduction to decision-making
• Why and how to study decision-making?
• Why is it hard to study decision-making? How do usually humans make decisions and what kind of insights a psychological perspective can provide?


Class 2: Understanding strategic decisions
• Making strategically relevant decisions: What is Strategy?
• Current strategic challenges
• How can a psychological perspective be of help in promoting new forms of strategic adaptation in a globalized, fast-changing world?

Class 3: The relationship between cognitive biases and risk management
Class 4: The affective side of risk perception
Class 5: Contextualizing risk perception and risk management 
Class 6: Groupwork and presentations

Feedback activity: Connected with the activity in the previous class (class 6), teams will be given general feedback by the instructor in class.

Class 7: The role of performance aspirations on risk-taking
Class 8: The importance of efficacy beliefs
Class 9: The role of the competitive environment 
Class 10: Group biases and risk management
Class 11: Wrap-up and recommendations in preparation for the mini-project.

Teaching methods
There will be a combination of teaching presentations (by the instructor) and groupwork by the students based on business cases and other practice-oriented exercises in class. Video recourses will also be used in relation to the cases and students will learn how to apply the theory to these real situations. Furthermore, an external speaker may also contribute with course relevant experience.
Feedback during the teaching period
Students will make short team-presentations in class. After every presentation and at the end of the session, the instructor will provide detailed feedback for improvement, as well as general feedback.
Moreover, all Home Project Assignments/mini projects are based upon a research question (problem formulation) formulated by the students individually, and must be handed in to the course instructor for his/her approval no later than 12 July 2018. The instructor must approve the research question (problem formulation) no later than 17 July 2018. The approval is a feedback to the student about the instructor's assessment of the problem's relevance and the possibilities of producing a good report.
Student workload
Preliminary assignment 20 hours
Classroom attendance 33 hours
Preparation 126 hours
Feedback activity 7 hours
Examination 20 hours
Further Information

Preliminary Assignment: To help students get maximum value from ISUP courses, instructors provide a reading or a small number of readings or video clips to be read or viewed before the start of classes with a related task scheduled for class 1 in order to 'jump-start' the learning process.


Course timetable is available on https://www.cbs.dk/uddannelse/international-summer-university-programme-isup/courses-and-exams.


We reserve the right to cancel the course if we do not get enough applications. This will be communicated on https://www.cbs.dk/uddannelse/international-summer-university-programme-isup/courses-and-exams end February 2018 at the latest.


Expected literature

Mandatory readings:



- Hastie and Dawes, 2010. ‘What is decision making?’ in Rational Choice in an Uncertain World, 2nd ed., Chapter 2, pp 23-43. Thousand Oaks: Sage.
- Tversky, A., & Kahneman, D. (1971). Belief in the law of small numbers. Psychological bulletin, 76(2), pp 105-110.


- Robert M. Grant 2010. "The concept of strategy" in Contemporary Strategy analysis, 7th edition, Chapter 1, pp 3-30. John Wiley & Sons Ltd: United Kingdom.
- Hodgkinson, G. P., & Healey, M. P. (2008). Cognition in organizations. Annu. Rev. Psychol., 59, 387-417.
- Eisenhardt, K. M. (1989). Making fast strategic decisions in high-velocity environments. Academy of Management journal, 32(3), 543-576.


- The Psychology of Judgment and Decision Making by Scott Plous, McGraw Hill, 1993. Chapter 10
- Kahneman, D., & Lovallo, D. (1993). Timid choices and bold forecasts: A cognitive perspective on risk taking. Management science, 39(1), 17-31.
- Bazerman, M & Moore, D. (2013). Judgement in managerial decision-making. Chapter 3 “common biases” and chapter 4 “Bounded Awareness”. Wiley: Hoboken. NJ. 


- Lerner, J. S., & Keltner, D. (2001). Fear, anger, and risk. Journal of personality and social psychology, 81(1), 146
- Lerner, J. S., & Keltner, D. (2000). Beyond valence: Toward a model of emotion-specific influences on judgement and choice. Cognition & Emotion, 14(4), 473-493.
- Podoynitsyna, K., Van der Bij, H., & Song, M. (2012). The role of mixed emotions in the risk perception of novice and serial entrepreneurs. Entrepreneurship Theory and Practice, 36(1), 115.


- Austin, L. 2016. Risk as Feeling in Risk Taking and Risk Management in Organizations, in The Routledge Companion on Strategic Risk Management, edited by Torben Juul Andersen.
- Sitkin, S. B., & Pablo, A. L. (1992). Reconceptualizing the determinants of risk behavior. Academy of management review, 17(1), 9-38.
- Renn, O. (1998). The role of risk perception for risk management. Reliability Engineering & System Safety, 59(1), 49-62.

- Lant, T. K. (1992). Aspiration level adaptation: An empirical exploration. Management science, 38(5), 623-644.
- Shinkle, G. A. (2012). Organizational aspirations, reference points, and goals: Building on the past and aiming for the future. Journal of Management, 38(1), 415-45
- Group activity.


- Krueger, N., & Dickson, P. R. (1994). How believing in ourselves increases risk taking: Perceived self‐efficacy and opportunity recognition. Decision Sciences, 25(3), 385-400
- Bandura, A. (2001). Social cognitive theory: An agentic perspective. Annual review of psychology, 52(1), 1-26.
- Bollaert, H., & Petit, V. (2010). Beyond the dark side of executive psychology: Current research and new directions. European Management Journal, 28(5), 362-376.


- Kilduff, G. J., Elfenbein, H. A., & Staw, B. M. (2010). The psychology of rivalry: A relationally dependent analysis of competition. Academy of Management Journal, 53(5), 943-969.
- Hu, S., Blettner, D., & Bettis, R. A. (2011). Adaptive aspirations:
performance consequences of risk preferences at extremes and
alternative reference groups. Strategic Management Journal, 32(13),
- Chen, M. J., & Miller, D. (2012). Competitive dynamics: Themes, trends, and a prospective research platform. The Academy of Management Annals, 6(1), 135-210.


- The Psychology of Judgment and Decision Making by Scott Plous,
McGraw Hill, 1993. Chapters 16 and 17 & 18.


Additional relevant readings:


- Smith, C. A., & Ellsworth, P. C. (1985). Patterns of cognitive appraisal in emotion. Journal of personality and social psychology, 48(4), 813.
- The Psychology of Judgment and Decision Making by Scott Plous, McGraw Hill, 1993. Chapter 12
- Doz, Y. L., & Kosonen, M. (2008). Fast strategy: How strategic agility will help you stay ahead of the game. Pearson Education. (book) 


Last updated on 23/07/2018