In November 2023, I attended a keynote talk by Oxford University Professor Russell Foster. In his keynote, he discussed research he was part of that explored sleep health in a UK-based financial Institution [1]. He explained that poor sleep and resulting fatigue may be especially harmful for these people, as they are linked to riskier decision-making. Cheekily, I asked him that sleep loss led to riskier decision-making, wouldn’t it be beneficial for some of his cohort of interest? After all, investment banking necessitates some risk-taking, and there are certainly bankers who would likely be more successful if they took more risks. I got a chuckle from him before he reminded me that excessive risk-taking by bankers can destroy the lives of many, ala the 2008 Global Financial Crisis, which could well have been affected by bankers’ sleep loss [2].
Sleep loss does not inherently negatively affect “decision-making”. Instead, sleep loss-induced fatigue results in various cognitive changes (which are far from fully understood), and these, in turn, may alter how the individual responds to a given scenario. While this is generally a bad thing, it isn’t automatically a bad thing.
Below, I’m going to discuss three examples for which, according to our current scientific understanding, sleep loss-induced fatigue may positively affect decision-making. To be clear, these are hypothetical scenarios that I’ve conjured up for a bit of fun; fatigue will often result in poorer decision-making, and the risks of fatigue in operational environments span well beyond its impact on decision-making. We would never encourage any individual to intentionally forego sleep for a “performance benefit” in an operational environment. Also, the following strictly addresses sleep, fatigue, and decision-making; other potential benefits of intentional sleep restriction or loss (e.g., within Cognitive Behavioural Therapy for Insomnia or for potential creativity benefits), while interesting, are topics for another day.
Scenario 1: When simpler and less effortful paths are preferred, but individuals are tempted to take the more difficult approach. Sleep loss-induced fatigue appears to lead to less effortful decision-making in most people [3]. In 2010, Engle-Friedman and colleagues investigated the sleep of adolescent figure skaters, and how it related to the difficulty of manoeuvres they chose to undertake [4]. They found that more awakenings and more time spent awake the night before testing were linked to simpler manoeuvres undertaken, while sleeping less and waking up earlier were associated with perceived difficulty of the manoeuvres. In a study that formed part of my PhD thesis, I similarly collected data that suggests when sleep-deprived esports athletes (competitive video game players) are sleep-deprived, they prefer a more straightforward, safer playstyle [5].
Athlete performance was not reported in the first study, and in my research, the playstyle employed was not associated with overall performance. However, it is not difficult to imagine circumstances in which it could lead to improved performance. In the first study, for example, choosing less complex manoeuvres in competition (presuming that sleep loss does not negatively impact the execution of the manoeuvres, which is a big assumption!) will likely lead to a greater likelihood of solid execution, and may overall be the better choice for many athletes.
Scenario 2: When searching for shortcuts and making the easier, less effortful decisions, it may help uncover both inefficiency in work processes and how they could be overcome. This is the whole Bill Gates “I choose a lazy person to do a hard job, because a lazy person will find an easy way to do it” thing. There are probably many better (and safer!) ways to achieve this benefit; however, it’s not overly challenging to imagine this being a possibility.
Scenario 3: When overanalysing situations is highly likely, and sticking to “rules of thumb” in the face of some contrary and highly situation-specific information is beneficial. Sleep loss appears to lead to increased reliance on heuristics to simplify complex decision-making [3]. In the previous blog post [Exactly how does fatigue impact decision-making in business? | Melius Consulting], I gave an example of a tired investment banker who, when seeing a certain pattern, follows their rule of thumb and buys a stock instead of understanding the specific scenario a little further. While perhaps it is possible that the bankers further research indicated that their “rule of thumb” should not apply here, it is also possible that this research gives the individual a false impression of situation specificity, where in reality their heuristic is still applicable. In short, a tired individual who applies a simple rule of thumb to a situation rather than considering all available data may do well in contexts where information is scarce, speculative, uncertain or misleading.
While this is a bit of a fun thought experiment, I again want to make clear that fatigue is something to be avoided as much as reasonably practical in workplaces (particularly when safety-critical work is present).
Collectively, our team at Melius Consulting has over 400 peer-reviewed journal articles, book chapters, conference papers, and industry white papers, and is among the world’s leading experts in sleep, health, safety, and risk. We have worked with industry bodies, a range of clients across mining, oil and gas, defence, agriculture and healthcare, in Formula 1 and with many national and international sporting bodies, and in collaboration with the US Military and academic bodies such as Monash University, the University of Western Australia, and Central Queensland University. Our breadth of applied and research experience enables us to deliver thorough, evidence-based solutions you can trust.
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References
1. Illingworth, G., et al., The Sleep of Shift Workers in a UK Financial Organisation and Associations with Mental, Physical, Social and Cognitive Health. Clinical and Translational Neuroscience, 2023. 7(4): p. 33. DOI: https://doi.org/10.3390/ctn7040033.
2. Foster, R.G., ‘You’ll have more empathy, you’ll have more fun’: the man who wants to transform our relationship with sleep, in Sleep, D. Shariatmadari, Editor. 2023, The Guardian.
3. Lim, J.Y.L., et al., The impact of sleep loss on decision making: Opening the cognitive black box. Sleep Medicine Reviews, 2025. 82: p. 102114. DOI: https://doi.org/10.1016/j.smrv.2025.102114.
4. Engle-Friedman, M., V. Palencar, and S. Riela, Sleep and effort in adolescent athletes. Journal of Child Health Care, 2010. 14(2): p. 131-141. DOI: https://doi.org/10.1177/1367493510362129.
5. Smithies, T.D., An Empirical Investigation into the Effects of Sleep Loss on Esports Performance, in Physical Education and Sport Sciences. 2023, University of Limerick: https://doi.org/10.34961/researchrepository-ul.25102469. p. 242.