How do cognitive biases impact the workplace?
Every single day, every single person, in every single workplace throughout the world is taking – or not taking – some actions based on thoughts, beliefs and perceptions of which they are completely unaware.
Do you think of yourself as an unbiased leader? That you make rational decisions? That you don’t jump to conclusions and base your decisions on facts and evidence? People say being an unbiased leader is important, yet such leadership can be challenging because of how our brains work.
Thinking about our thinking
All of us develop cognitive biases—the unconscious drivers that influence our judgment and decision-making. They are pervasive in life and organisations, and are a big deal for leaders. In some ways, biases are very helpful and adaptive, allowing us to use previous knowledge in making new decisions. At the same time, they can be unhelpful, keeping us from considering a broad range of options, or blinding us to fresh information.
While most of us recognise that we can fall prey to bias, we almost never think we are biased in the current moment! Biases exert their influence outside of our conscious awareness. In a 2014 article published in the Neuro Leadership Journal, Matthew Lieberman and his colleagues noted that individuals are notoriously poor at recognising and controlling their own biases because our brains are wired to promote fast and efficient information processing.
“Unconscious cognition is essential to human functioning; it helps us to be efficient and responsive to the world around us. However, unconscious processes are also prone to errors; errors that remain unrecognised and uncorrected which can lead to flawed decision-making, significant bias and blinkered thinking”. (Lieberman)
We think we know how our world works, but we really don’t. We change our opinions and cobble together a story about who we are and why we do the things. The truth is, there is a growing body of psychology and cognitive science research that says we do not have a clue why we act in the way we do, or choose the things we do or think the thoughts we have. Instead we create little stories in our heads about why we gave up on a diet, why we don’t coach people or why we manage our time in the way we do.
As humans we have invented amazing things; we have even reached the moon. Yet we manage to lose our keys, forget what we are about to say, get fat, become broke and move from one crisis to another. The bottom line is every brain is infested with preconceived notions and patterns of thoughts that lead it astray without knowing it.
You are issued a model at birth that becomes riddled with delusions and cognitive biases, built to create stories to help explain the difficult and messy business of being a person. It also comes with something else, a powerful overconfidence that works around the clock to keep you from noticing all those shortcomings. Sure, you are capable of logic and reason and rationality, but when you fall short of those ideals, you tend not to notice. That brain in your noggin hasn’t changed much in half a million years.
So what is a Cognitive Bias?
They are predictable patterns of thoughts and behaviours that lead you to draw incorrect conclusions. We all have this ability to see things in the wrong way, and we rarely notice them. Many of them serve you to keep you confident or inhibit you from making an idiot of yourself. Cognitive biases lead to poor choices, decisions and insights that are often incorrect. Cognitive biases are very human and arise from our need to make sense of a situation before deciding on a course of action. As we acquire, retain and process relevant information, we filter it through the context of our own past experiences, likes and dislikes. Not surprisingly, with every subsequent challenge, our response is increasingly shaped by our knowledge of ‘how we’ve always done it’. There are over 180 cognitive biases found so far!
Cognitive biases are something most of us cannot avoid. But once you know how to spot them, you can see them all around you. They are the instinctive leaps our minds make—our gut reactions and things we “know”, though we’re not sure how we know them. Scientists believe they are a relic of evolution: little shortcuts programmed into our minds to help us process information faster. But they sometimes lead us just as quickly to the wrong conclusions.
In the workplace, unconscious biases can manifest within business processes such as recruitment and performance reviews, leading decision-makers to unfairly advantage some, whilst disadvantaging others.
We are going to focus on a few biases that could impact how we manage people. As a manager, being aware of these biases enables us to ‘think about our thinking’ and reduce the potentially negative impact of these biases. Here are some biases that can impact how we view ourselves and how we manage our teams, they are:
A bias that can sometimes lead us to thinking that we are better than we actually are. Research shows that 80% of us see ourselves as above average. Just ask anyone ‘Are you a good driver?’ and see what response you get. Ask 100 people if they have good common sense, and more than 95% will tell you they do.
A bias that stops us looking at the whole picture as we filter out information and focus on facts that back up our perceptions around people and events. We tend to like people who think like us. If we agree with someone’s beliefs, we’re more likely to be friends with them. While this makes sense, it means that we subconsciously begin to ignore or dismiss anything that threatens our world views, since we surround ourselves with people and information that confirms what we already think.
A bias that sometimes clouds our judgement by making us focus on, and put more importance on, more recent events rather than what has happened in the past. Have you ever felt that feedback you have received was unfair because this is the first time you have made a mistake and prior to that you have excelled in that area? This could be an example of Recency Bias, where we are given feedback on a recent event but have failed to acknowledge previous and past performance.
People pay more attention to, and give more weight to, negative rather than positive experiences and information. While the negativity bias makes sense in an evolutionary context (our desire for survival, fear of pain, etc.), today it can lead to unnecessary risk aversion in environments where people should be taking more risks, particularly in a business setting.
You may be tired of hearing people tell you to “be positive,” but they might be onto something. Studies show that people are more likely to be affected by negative memories and feelings than pleasant ones, and this tendency leads to a huge negativity bias. So many organisation suffer from a climate of negative critique vs. catching people doing things right. There is no doubt that increased positive interactions with people can help counteract this powerful and morale-killing bias.
A study conducted by Harvard Professor Teresa Amabile had over 200 professionals from various industries to keep diaries for several months in which they recalled something that stood out from their day. After reviewing over 12,000 entries, she found that setbacks affected workers’ happiness twice as much as a step forward on a meaningful project. While progress helped to decrease frustration, setbacks increased frustration at a three times more powerful rate, meaning that professional setbacks affect you much more deeply than progress does, and you are therefore likely to remember and alter your decisions in the future based on this perceptual bias.
Spill over effect
We often remember past performances of individuals both positive or negative which can give rise to some biases. If someone has performed exceedingly well in the previous appraisal cycle, he has a higher chance of getting a higher rating even if the performance has been just an average this year. This reverse is also true where the negative performance of a previous year can overshadow good performance in the current appraisal cycle.
Fundamental Attribution Error
This is the tendency to blame others when things go wrong, instead of looking objectively at the situation. In particular, you may blame or judge someone based on a stereotype or a perceived personality flaw. For example, if you’re in a car accident, and the other driver is at fault, you’re more likely to assume that he or she is a bad driver than you are to consider whether bad weather played a role.
This is a person’s overall impression of someone, and it influences our feelings and thoughts about the other persons overall character. It is the perception, for example, that if someone does well in a certain area, then they will automatically perform well at something else regardless of whether those tasks are related. Under the “Halo Effect” bias, we tend to lump together positive qualities, and assume where one attractive quality exists, others also exist.
The tendency to do or believe what others do or believe. For example, your leader may believe someone is great at their job and you go along with this. As more people come to believe in something, others also “hop on the bandwagon” regardless of the underlying evidence. Studies show that, in the right circumstances, as much as 75% of people will give answers that they know are false, simply because others around them have given the same incorrect answer (whereas less than 1% would answer incorrectly otherwise).
Projection bias describes our tendency to assume that other people think like us. The average person assumes that their way of thinking about things is typical of most people, and therefore other normal people will come to the same conclusion as them. Or at the very least, people overestimate the normality of their beliefs in relation to others.
This assumption can be detrimental for leaders who are trying to better relate to their people. It is unlikely that other people harbour similar priorities and attitudes to yours, and yet we tend to jump to the conclusion that we “know what people really want.”
Bias blind spot
If you read this thinking that all these biases don’t apply to you, you might suffer from bias blind spot. This bias makes us think that while biases do apply to others, we are immune to them. The term was coined by Emily Pronin, a social psychologist at Princeton University, and her colleagues. In their experiments, Pronin and her colleagues asked subjects to make judgments about themselves and other subjects. The subjects demonstrated standard biases. However, when they explained the biases and asked how it might have affected their judgement, the subjects rated themselves to be less susceptible to bias than others.
Pronin and her colleagues’ explanation is that when people asses themselves for bias, they look inward, looking through their own thoughts and feelings for bias. “But biases operate unconsciously, and people use the introspection as a reliable indicative that they, unlike others, are immune to bias. Which is why you might be able to see the above biases in your team members, but not in yourself”.
So how do we outsmart our cognitive biases?
We are all susceptible to biases, especially when we’re fatigued, stressed or multitasking. Even the smartest people exhibit biases in their judgements and choices. It’s foolhardy to think we can overcome them through sheer will. But we can anticipate and outsmart them by nudging ourselves in the right direction.
The lens I see my team through. Look at every member of your team and ask yourself the following questions:
- What do I believe to be true about each person?
- What conclusions have I drawn?
- What assumptions have I made?
- What meaning have I attached to create those assumptions?
- What data did I select to create these assumptions?
- Was I looking at the whole picture or did I miss something?
- Are there any other conclusions or beliefs I could have adopted if I had looked at the bigger picture?
Training and awareness building: Before each performance evaluation cycle, run short training sessions with managers to go through the best way to evaluate performance and how to avoid biases.
Use 360 degree feedback: Feedback from peers or other leaders who worked with the individual can provide insights on the performance which the manager is not able to see due to his biases. You don’t need lengthy 360 surveys – a few informal questions by email could be really enlightening.
Be aware of the biases you have created about colleagues or team members; ask yourself, if you were meeting them for the first time, would you think differently about them? Would you treat them differently? Are you favouring people because you think they like you? The key to getting rid of these biases is so hard and oh, yet so simple. The key is in conscious awareness and practice. Simply knowing that cognitive biases exist can distort your thinking and will help lessen their impact. Learn as much as you can about cognitive biases and recognise them in yourself.
Ask for feedback about biases you may be demonstrating – be open to the feedback, remain curious and suspend judgement. All feedback is a gift, even when it is poorly wrapped. You may not like it and it may be uncomfortable, but there is value in it nonetheless. Regardless of the other person’s motivations for giving you feedback, there is always the opportunity to learn something about yourself that you previously did not know.
There are two truths. Be curious, there are always two truths, your ‘truth’ and someone else’s. Remember, a difference in opinion is an opportunity to learn as opposed to a threat to your own identity. People who are scared to change their mind are the people that will fail to change anything.
When making decisions, take a step back and assimilate all the information before coming to a conclusion. Check any assumptions you have made. Surround yourself with a diverse group of people, and don’t be afraid to listen to dissenting views. You can also seek out people and information that challenge your opinions, or assign someone on your team to play “devil’s advocate” for major decisions.
Three Key Questions. Daniel Kahneman recommends that you ask three questions to minimise the impact of cognitive biases in your decision making:
- Is there any reason to suspect the people making the recommendation of biases are based on self-interest, overconfidence, or attachment to past experiences? Realistically speaking, it is almost impossible for people to not have these three influence their decisions.
- Have the people making the recommendation fallen in love with it? Again, this is almost an inevitability because, in most cases, people wouldn’t make the recommendation unless they loved it.
- Was there groupthink or were there dissenting opinions within the decision-making team? This question can be mitigated before the decision-making process begins by collecting a team of people who will proactively offer opposing viewpoints and challenge the conventional wisdom of the group.
In answering each of these questions, you must look closely at how each may be woven into the recommendations that have been offered and separate them from their value. If a recommendation doesn’t stand up to scrutiny on its own merits, free of cognitive bias, it should be discarded.
Only by filtering out the cognitive biases that are sure to arise while decisions are being made can you be confident that, at the end of the day, the best decision for you and your people was made based on the best available information.
If you choose to change how you view a person or a situation, you will be amazed at the difference in the results you observe!