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How the positives can be negative, and the importance of getting real

We're biased toward seeing things the way we wish they were, as opposed to how they really are. It's human nature, but it can be risky when it comes to processing information necessary for solid decision-making. Good business decisions mean getting real. And getting real means looking outward - not inward - for answers.


Let me tell you about a manager I once knew. Even when serious crap was going down, he would say, “Hey, it’s fine! Everything is going to be ok!” And believing this, he’d do nothing to fix his company’s chronic problems.

Now let me tell you about another manager I once knew. Even when things were fine enough, the smallest speed bump would cause her to say, “This is a disaster! We need to fix it fast!” And believing this, she’d throw her team into an unnecessary state of stress and frenzy.

Two different managers. Two different reactions. Two different biases.

They had two things in common: both of their biases were severe; and neither were aware of their biases – even as they were screwing everything up for themselves and everyone else.

In this post, I’m going to talk about the first manager, offer some hypotheses as to why he was the way he was, and what would make him likely to change.

In my next post, I’ll talk about the second manager.

Maybe you’re one of them. Maybe just sometimes. There’s a good chance that, in this moment, you’re asking yourself if you are. Don’t sweat that question too hard: being human, you probably won’t be great at knowing for sure. I’ll explain why in a second - but first, a couple of pitfalls that make bad business decisions happen.

First, people have a tendency to see the future the way they wish it would be, rather than the way it actually is.

And why wouldn’t they? Reality can often suck.

Humans expect things to be ok much more often than they expect things to fall apart, even when the data is stacked against them. We all know that half of marriages end in divorce, but almost all couples who are about to get married are 100% convinced they’ll never split. We know most businesses fail, but most entrepreneurs, soon after launching their businesses, don’t believe they’ll be a casualty.

It’s how we’re “wired.” When we hear positive information about what could happen in the future, we absorb it. When we hear negative information, we deflect it. Not always, and not all of us, but generally speaking, this is our human bias. According to research.

Second, people have a tendency to see evidence they want to see, rather than evidence that actually exists.

Bias prevents a fair assessment of pros and cons. People are more likely to ignore information that proves them wrong (“That research study can’t be true! I don’t buy it!”) And they’ll hang onto information that proves them right (“I don’t believe that survey data, but I do believe the story this one customer told me about.…”).

It’s a trap. It hurts managers and their teams, but it also hurts business leaders trying to drive strategy, build brands, design innovative products, and grow companies. Without an accurate assessment of information, you can't make decisions well.

All of this happens without your knowledge, which makes it hard to fix.

There’s a healthy dose of research out there suggesting that many of us struggle with accurately assessing our qualities, traits, and strengths. In one study, researchers used the Big Five personality test to see if peoples’ self-described traits matched up to how others experienced them. They didn’t. In another study, 93% of drivers reported being better drivers than average. Even people who’ve been hospitalized for car accidents that they were responsible for reported being above-average drivers. In yet a third study, incarcerated individuals reported that they were above average when it came to traits such as kindness, morality, and law-abidingness.

We are biased toward not being great at knowing how great we are (or aren’t). If you want to get real, then there it is.


So what now?

How do you fix it? Not on your own. Biases, by definition, happen under the radar. You don’t see them coming and you don’t see them going. All you see is the aftermath.

It’s scary to admit that there are parts of yourself that you don’t see. But you’re not alone. Humans are… well… human. And blind spots are called “blind spots” for a reason.

If you want to know what’s really up, you need to look outward, not inward. Rather than explore your inner self through introspection, ask around. Ask for feedback - not just about your specific business challenges but also how people experience your process for evaluating those challenges and making decisions.

Ideally, the help you seek should be from someone who gets decision-making and can spot specific biases as they emerge. If you don’t have that special someone in your life, then contact us and we’ll point you in the right direction.

Whatever you do, you won’t always be able to know you’re doing it. No matter how smart you are (and you are smart!), you’re still human. As long as you’re human, you’ll be swayed by decision-making pitfalls that are part of human nature.

Recognizing that is huge. All you have to do is take it from there.


#BusinessStrategy #BusinessDecisions #DecisionScience #OptimismBias #ConfirmationBias #Overconfidence


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