Bank credit officers are more likely to approve loan applications earlier and later in the day, while 'decision fatigue' around midday is associated with defaulting to the safer option of saying no.
These are the findings of a study by researchers in Cambridge's Department of Psychology, published today in the journal Royal Society Open Science.
Decision fatigue is the tiredness caused by having to make difficult decisions over a long period. Previous studies have shown that people suffering from decision fatigue tend to fall back on the 'default decision': choosing whatever option is easier or seems safer.
The researchers looked at the decisions made on 26,501 credit loan applications by 30 credit officers of a major bank over a month. The officers were making decisions on 'restructuring requests': where the customer already has a loan but is having difficulties paying it back, so asks the bank to adjust the repayments.
By studying decisions made at a bank, the researchers could calculate the economic cost of decision fatigue in a specific context -- the first time this has been done. They found the bank could have collected around an extra $500,000 in loan repayments if all decisions had been made in the early morning.
https://www.sciencedaily.com/releases/20...191622.htm
Interesting - but to be fair, they've observed the behaviors of only thirty credit officers within one bank. Definitely worth a deeper dive to see if this is happening across the entire banking industry (or other industries). It probably is to some degree, we're all human, especially if employees are overworked and companies are understaffed.
But, imagine a nurse nearing the end of his/her shift, experiencing a bout of decision fatigue, juggling a number of patients' medications...or a parole hearing goes south because a few ''decision makers'' are fatigued. After reading this, I'd consider canceling a job interview during the ''midday slump'' as well, if I want to be favorably remembered.
This may be more common than we know, and decision fatigue in some professions is especially troubling if the negative outcomes aren’t being looked into as to why. I'm thinking most people who have cyclical performance issues aren't going to admit that it was due to feeling tired at certain times of the day. It would be interesting to see this study done in the healthcare field actually, to see if empathy declines as well, towards the end of a doctor's busy shift. Even a judge presiding over a case, who didn't get a restful night's sleep, might lack empathy during sentencing.
I'd suspect it might be difficult however, to quantify all mistakes as a result of decision fatigue, because there could be other cognitive factors involved.
These are the findings of a study by researchers in Cambridge's Department of Psychology, published today in the journal Royal Society Open Science.
Decision fatigue is the tiredness caused by having to make difficult decisions over a long period. Previous studies have shown that people suffering from decision fatigue tend to fall back on the 'default decision': choosing whatever option is easier or seems safer.
The researchers looked at the decisions made on 26,501 credit loan applications by 30 credit officers of a major bank over a month. The officers were making decisions on 'restructuring requests': where the customer already has a loan but is having difficulties paying it back, so asks the bank to adjust the repayments.
By studying decisions made at a bank, the researchers could calculate the economic cost of decision fatigue in a specific context -- the first time this has been done. They found the bank could have collected around an extra $500,000 in loan repayments if all decisions had been made in the early morning.
https://www.sciencedaily.com/releases/20...191622.htm
Interesting - but to be fair, they've observed the behaviors of only thirty credit officers within one bank. Definitely worth a deeper dive to see if this is happening across the entire banking industry (or other industries). It probably is to some degree, we're all human, especially if employees are overworked and companies are understaffed.
But, imagine a nurse nearing the end of his/her shift, experiencing a bout of decision fatigue, juggling a number of patients' medications...or a parole hearing goes south because a few ''decision makers'' are fatigued. After reading this, I'd consider canceling a job interview during the ''midday slump'' as well, if I want to be favorably remembered.
This may be more common than we know, and decision fatigue in some professions is especially troubling if the negative outcomes aren’t being looked into as to why. I'm thinking most people who have cyclical performance issues aren't going to admit that it was due to feeling tired at certain times of the day. It would be interesting to see this study done in the healthcare field actually, to see if empathy declines as well, towards the end of a doctor's busy shift. Even a judge presiding over a case, who didn't get a restful night's sleep, might lack empathy during sentencing.
I'd suspect it might be difficult however, to quantify all mistakes as a result of decision fatigue, because there could be other cognitive factors involved.