Decades ago scientists didn’t know that the brain’s neural pathways can keep growing. Now they understand neural networks play a key role in lifelong learning. Meanwhile, behavioral researchers have been studying how the human mind approaches decision-making, with findings that cast light on the cognitive biases that are nearly hard wired.
The upshot of these discoveries?
We have evidence that the firing of neurons doesn’t necessarily equate to logical choices grounded in reality. Just because we’re paid to think in our jobs, it doesn’t mean we’re thinking well.
Why care about cognitive biases
Everyone uses mental shortcuts. Once you know how grocery shopping works you don’t think twice about it. It would be a waste of time and energy.
That is, until the very real threat of COVID-19. Now, you do stop and consider new information and make decisions based on a sense of weighted risks and probabilities. Which stores require customers to wear masks? When are the shelves re-stocked? Are they testing their employees?
Put another way, pattern recognition is helpful for speed and efficiency. Until it’s not. Until the stakes are high if critical cues are missed.
Take it a step further. What if the information necessary to make a good decision is right in front of you, but you don’t recognize it. Or you discount it. Or you miscalculate it’s importance vis-à-vis another piece of information. In other words, what if you’re missing the boat on reality.
Finally, let’s compound the situation with attitudes and concepts that you don’t realize you have. Un-examined mental constructs — those held dear and “true” — can result in a highly subjective lens through which you see the world. If feels perfectly logical, while making you oblivious to contradictory evidence.
That’s why cognitive biases matter.
Cognitive biases in action
Every organization has a culture, invisible yet detectable. This is how we do things around here. What we do, when we do it, and even what we’re supposed to think. The undercurrents.
One company I worked with had a culture that even visitors couldn’t help but notice. People in elevators barely acknowledged each other, let alone spoke. The only people making jokes worked on the top floor. Creativity was frowned on. And yet, executives didn’t understand why up and coming leaders froze in their tracks when asked to innovate the product line.
What orientation gave rise to so many restraints and restrictions?
Execs feared, and strongly protected against, loss. It was hard to weight the potential gains of trying something new when loss aversion was so dominant. Their worldview was one of looming danger; worst case scenarios guided major decisions. Hence, the compulsion to protect permeated everything and extended to everyone protecting their jobs by not taking risks, not speaking up, not trying new ideas unless ordered to.
Five cognitive biases common to organizations
Wikipedia has a long list of cognitive biases with unique names for each. I’ve boiled down the top five I see stymie leaders and teams.
A single question, posed in a either positive or a negative frame, can yield two different answers. Even though it’s the same question.
Beef advertisers learned this trick. That’s why they highlight 95% lean rather than 5% fat, since people would rather buy very lean than slightly fat. Same product. Different ways of framing, leading to different perception and ultimately different behavior.
Negativity bias is the tendency to weigh potential loss more heavily that potential gain. We want to hold on to what we have. It’s known to us. There’s more uncertainty associated with a gain, since we don’t know if it will or won’t happen. As a result, we decide as if it won’t. This was true of the company described above.
Status quo bias
When status quo bias is at play, any change from the current state is perceived as an undesirable loss. It couples well with Negativity bias.
In organizations, it’s not unusual for decisions to be shaped by the decision-maker’s unspoken agenda to keep or build their own power and position. For example, large-scale change initiatives often are sponsored by senior leaders who want to reform systems, operations and other people. The project hits a ceiling, however, when sponsors reject the imperative for change in their own behavior or role.
Faced with any choice, there are things we know and things we don’t know. Availability bias is the tendency to work only with information at hand. To be blunt, it’s a failure of imagination to conceive the possible, the plausible and the known unknowns.
This last one, confirmation bias, brings us to the natural tendency to favor information that supports one’s existing position. There may be evidence to the contrary, but it’s left on the table. The evidence to covet is the evidence that confirms one’s beliefs.
Thinking your way through biases
How to combat these inclinations? It takes work. And no small dose of intellectual honesty. It’s worth it if you want to see reality more clearly, become a stronger innovator and make better decisions. How thorough and aggressive you are is up to you.
Quick start: innovation hacks
Masters in innovation design see cognitive biases for what they are: are a force to be reckoned with. They earn top dollar by artfully steering teams through and around natural biases. Two excellent techniques you can borrow are:
- Generate and debate the opposite. Ask someone with a strong opinion to turn it around and argue for the opposite position. This is especially effective when two people are polarized — have them assume the other’s stance and make the case for it. It’s an excellent way to gain distance on an issue when someone is overly attached.
- Design with constraints. For any issue at hand, limit the options. The value of the technique comes from the shift in perception, causing one to go deeper on a smaller set of details or shift one’s contextual interpretation.
Two other methods to temper the effects of cognitive bias are: naming biases when you see them in meetings and in yourself, and; taking the time to dissect your own world view and that of your organization. Tease apart the beliefs, assumptions and subtle nuances. Write them out. You’ll be amazed what you discover. Going forward, you’ll be less susceptible to cognitive biases if you’re fluent in the undercurrents in and around you.
Learn from the great minds in behavioral economics and research. A number of books make it easily digestible and even fun.
- Thinking, Fast and Slow by Daniel Kahneman
- Nudge by Richard Thaler and Cass Sunstein
- Outsmart Your Instincts by Adam Hansen, Edward Harrington and Beth Storz
- The Undoing Project by Michael Lewis
Finally, you can transform your perception of reality and how you perceive options. No kidding.
Structural thinking takes you beneath models and concepts, straight to the heart of what’s going on. The elements at play. How they function up in relation to each other. The limitations of an overall structure and the potential embedded within it.
For this I refer you to Robert Fritz, Inc. While his body of work – books, web, social media content – is vast, you can learn from the master himself in Fundamentals of Structural Thinking. Due to COVID-19, the 2020 course has been moved online in June, and is deeply discounted.