In their research, "Outsmart Your Own
Biases", Soll, Milkman and Payne, make the argument that we (as humans) are
cognitive misers i.e our decision are marred by biases. The most common biases, referred to as System
1 thinking - judgements based on past experiences and System 2 thinking -
deliberate thinking focused on the wrong thing. These biases, lead us to focus on only one
possible future, one objective and one option in isolation.
Drivers of Biases: The authors state these cognitive biases are motivated when driven by strong emotional attachments or investments. Trip wire or decision points can help in ensuring that logical decisions are made and preempt the biases. How to overcome these biases, is what I found most intriguing and will cover those in this article.
One Possible future - Bias implies that we are confident about our estimates and either use one best guess or hedge the bets. To overcome this bias, the authors suggest four different ways.
First, to
make at least 3 estimates instead of using a range. The low and high end estimates will allow for
planning, while the middle estimate will be a realistic.
Second, think twice i.e project two outcomes separated
overtime. This would allow for two
perspectives to be created and allows for valuable information to be conceived and
considered.
Third is to use pre-mortems
or process of identification of future potential issues and how to tackle
them.
Fourth is to take an outside view
on projects to avoid planning fallacy, which can lead to change of plans.
Thinking about objectives - is a bias when direction is unwittingly set by only a subset of goals because a larger range is never considered. There are two approaches to overcome this bias.
Thinking about objectives - is a bias when direction is unwittingly set by only a subset of goals because a larger range is never considered. There are two approaches to overcome this bias.
Start
by seeking advice from others on objectives in an independent setting, to avoid
subjectively anchoring.
Next step is to
cycle through the objectives, by reviewing the merit of each objective, allowing
for a converged view to be created.
Thinking about options - is a bias in which people rarely consider more than one option and questions are framed to elicit a yes or no response, in which we are constrained by assumptions based on past experiences. The two solutions to avoid this bias is by making joint decisions and to try the vanishing options test. In the former, decisions are made by evaluating the available choices jointly and in the latter as assumption is made that none of the options available can be selected, forcing an alternative approach, which might otherwise never be considered.
The final recommendations from the authors is to anticipate 3 future possibilities, 3 key objectives and 3 viable options. Utilizing these approaches, the biases can be preempted and we can nudge ourselves in the right direction.
Shortcomings of the Research: From a practical perspective, all the options suggested are valid, though time as a factor is rarely taken into consideration. Malcom Gladwell in his book, "Blink" refers to the concept of "thin slicing", which allows for finding patterns based on narrow windows of experience. If time is of the essence, then consideration of multiple options, be it about future, objectives or options, might not be luxury that is available.
PLC & BCG Correlation to decision making: From a business perspective, the decision making process can be correlated to the state of growth. For example, in embryonic stage, decisions are rapid, as there are minimal to no processes that exist. During growth, decisions are made to ensure growth is viable, though pivoting is possible, since mass market adoption of production may yet to occur. In maturity stage however, processes have to exist and recommendations have to considered, to avoid the decline of the business.
Ref: Soll, J. B., Milkman, K. L., & Payne, J. W. (2015). Outsmart your own biases. Harvard Business Review, 93(5), 64-71. Retrieved from https://hbr.org/2015/05/outsmart-your-own-biases
Thinking about options - is a bias in which people rarely consider more than one option and questions are framed to elicit a yes or no response, in which we are constrained by assumptions based on past experiences. The two solutions to avoid this bias is by making joint decisions and to try the vanishing options test. In the former, decisions are made by evaluating the available choices jointly and in the latter as assumption is made that none of the options available can be selected, forcing an alternative approach, which might otherwise never be considered.
The final recommendations from the authors is to anticipate 3 future possibilities, 3 key objectives and 3 viable options. Utilizing these approaches, the biases can be preempted and we can nudge ourselves in the right direction.
Shortcomings of the Research: From a practical perspective, all the options suggested are valid, though time as a factor is rarely taken into consideration. Malcom Gladwell in his book, "Blink" refers to the concept of "thin slicing", which allows for finding patterns based on narrow windows of experience. If time is of the essence, then consideration of multiple options, be it about future, objectives or options, might not be luxury that is available.
PLC & BCG Correlation to decision making: From a business perspective, the decision making process can be correlated to the state of growth. For example, in embryonic stage, decisions are rapid, as there are minimal to no processes that exist. During growth, decisions are made to ensure growth is viable, though pivoting is possible, since mass market adoption of production may yet to occur. In maturity stage however, processes have to exist and recommendations have to considered, to avoid the decline of the business.
Ref: Soll, J. B., Milkman, K. L., & Payne, J. W. (2015). Outsmart your own biases. Harvard Business Review, 93(5), 64-71. Retrieved from https://hbr.org/2015/05/outsmart-your-own-biases
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