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How we come to believe things that aren’t true.
How we come to believe things that aren’t true.
Our selfish genes love to conserve calories, we use heuristics (shortcut generalisations) & biases to avoid the calorie intensive work of thinking. This was fine when we had relatively few, often very present things to predict. Is that rustling in the bushes a tiger that will eat me, will that berry nourish or poison me, will that branch hold, is this a good place to make camp.
Nowadays we are often tasked with analysing & predicting things unseen, borne through complicated 1 and 0’s with thousands of possible outcomes. Our ability to compute the data or even grasp this situation breaks down. We stray from optimal decision making whilst bias keeps us insisting we are rarely wrong.
Here is a bit about why that happens and what you can do to fix it.
Two overarching reasons are that we are bad at spotting when our brains slip into energy conservation mode, this is why movies/ optical illusions work so well. We slip from absorbing + understanding to acknowledging + forgetting information without realising it leaving us susceptible to simple answers that sound right over complicated answers that contain many causes and clauses. This problem gets compounded by ‘group think’ which means we tend to go along with a consensus (study by Asch).
We have a really hard time not giving ourselves an A+ on a task; I am late because I had numerous valid reasons, that person is late because they are lazy. 75% of drivers think they are above average. As we will see this problem compounds with experience/ success.
2 main problems arise as a result of this thinking.
Firstly, we can fall prey to confidence tricksters who tell us what we want to hear. This is often a belief that we hold or a widely held, simple truth that masks most of the story.
Second, we hold onto a narrative that worked in the past but is working against us now.
We have a really hard time not giving ourselves an A+ on a task; I am late because I had numerous valid reasons, that person is late because they are lazy. 75% of drivers think they are above average. As we will see this problem compounds with experience/ success.
How to tell if this is happening to you.
Working memory overload. Analysing cause & effect overloads our brains if too many variables come into play. For example, trying to assess why a campaign or creative didn’t work, why interest in your brand drops or why you don’t get more return buyers. These are tough problems that people tend to gloss over in favour of easier problems.
Working memory shut down. A great bias spotter, Dan Ariely, did a study where he found that we become worse at complex decision making as the stakes get higher, our brains stall and focus on the negatives. You may have felt this walking over a big drop vs along the pavement or when something really big happens and you want to sit down.
See the diagram below as a quick example. Which Row/ Column has the highest average?
Easy
Medium
Hard
Did you notice anything out of place?
It is easy to tell which column row has the highest average until all of a sudden it becomes essentially impossible without pen & paper or even better a computer doing the calculation. Too often in business we try and do the calculation ourselves without realising we are actually just guessing or believing what other people tell us.
Minds closed to new ideas: “Insight into the future requires a style of thinking uncommon among experts.” A man named Tetlock studied our ability to make predictions and found a surprising truth.
“There is often a curiously inverse relationship,” Tetlock concluded, “between how well forecasters thought they were doing and how well they did.”
As we gain experience we often close our minds to new ideas. We become entrenched in our views, we take pleasure in the certainty and safety it gives us. (see people who espouse conspiracy theories for an enlightening example).
For larger companies, status quo thinking is not an immediate threat but for startups it often puts an invisible ceiling on growth.
What is the solution?
What is the solution?
The methods below can be used to bring problems in range of our higher cognitive functions, away from guesswork and the resultant “great idea but” excuses: poor execution, poor timing, just a random market movement, just didn’t gel with customers, let just move on to the next campaign.
The Hedgehog & the Fox. Tetlock found that we fall along a spectrum from Hedgehogs to Foxes.
Hedgehogs are dogmatic, they felt their experience + expertise would guarantee success. They were bold, strident and confident in their views
Foxes on the other hand are bright, curious and often full of self doubt
Foxes are better forecasters by a mile. Lifelong learners, often spanning multiple fields, picking up info wherever they could. They make smaller, more hedged predictions, more often aware when they lack all the facts.
This doesn’t mean that you only need foxes. Hedgehogs are great in a pinch when something needs to get done and people need something to rally behind.
The more accurate a prediction is, the more nuanced it is likely to be. Here are a few ways you can escape the matrix of illusory truth.
Be comfortable with not having all the facts. A hypothesis that has a 51% chance of being right is better than comforting guesses over the long run. Just ask any casino.
Encourage the creation of in-depth explanations. These form the basis of high level standardised summaries for sharing. Standardised reporting is your friend and very rare in startups.
Don’t try and solve massive questions. Why are our ads better, how is my website doing, why aren’t customers more loyal. Break a problem down into its component parts and solve one a week for 10 weeks.
Don’t always reward speed over quality. Standardise a problem solving method that rewards conceptual leaps & automate repetitive, speed focused tasks.
Remove the fear. Imagine you are advising another company on what they should do. Or try, explicitly, looking at the problem through different approaches e.g. wearing different hats.
Do a Pre-mortem. Think up reasons why something may fail before it starts. This is not to reject any idea with a flaw but acknowledge the risks and create contingency plans.
Optimise in flight! Too many people launch an initiative then wait until it is done before conducting any analysis by which time it is often too late.
Become an archeologist. Once your initiative, test, campaign is over the biases we discussed will tempt you into ignoring the evidence, to keep ploughing on so set aside meaningful time & rewards to uncover deeper, more impactful causes.
All these things should help you create the future rather than having to predict it. It might feel uncomfortable at first, you will need to stay the course and probably reward yourself with a cake after a long day. Your brain will thank you for the calories!
I hope you enjoyed this post is you have anything to add or query let me know!
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