Impacts of cognitive style and strategic reference point on decision-making choices of managers

Abstract

The purpose of this study is to introduce the concept of strategic reference point into the study of the influence of cognitive styles on managers' decision making. Based on extant literature on cognitive style, strategic reference point and decision-making theory, this study constructs a theoretical model of the relationship among the three variables. Experiment studies are adopted in this research with subjects mainly consisting of MBA students and senior managers from various companies who volunteered to participate. The results of the study indicate that cognitive styles have influence on managers' choices of decision-making: field independent cognitive style has significant positive influence on the support of Program One, a more conservative decision whereas field dependent cognitive style has significant positive influence on the support of Program Two, a more risky decision. Cognitive styles have influence on choices of the strategic reference point. With joint influences from internal reference point, external reference point and time reference point, strategic reference point has influences on decision-making choices. Meanwhile, it has partial mediating effect between cognitive styles and decision-making choices.