Is Delusional Thinking Killing Your Business?

Categories: Behavior change, Employee Engagement, Feedback, LeadershipAuthor:

Eating things that have lots of fat, sugar, or salt makes us feel really good (when we’re eating).  In fact, scientists have found that our bodies are physiologically wired to crave these three evil ingredients.  I don’t mean to give you an excuse for over-indulging (although I’m happy to help out), but it’s true.

In just the same way as we are hard-wired to seek out harmful foods, psychologists have found that we’re psychologically prone to seek out information that corresponds with our beliefs and to discount contrary evidence.  Companies like Google are now capitalizing on this by delivering custom-built searches based on your internet usage history – all so that you don’t have to experience anything that is inconsistent with your current views.  When you conduct a search, you get just what you were expecting to get.

This may be convenient in an internet search engine, but I’d argue it’s a fundamental problem when it becomes part of your work life.  Specifically, I’m thinking of how leaders get feedback about their business practices.  The methods I’ve seen people using can lead to an insular environment, or worse – complete delusion.

Delusional thinking is so widespread in business and in life these days that Psychologists have a name for it: Confirmation bias.  Confirmation bias occurs when you pay attention to and seek out information that agrees with your previously held views.  Meanwhile, you downplay, discount, or ignore evidence that contradicts your views.

Studies have shown that this exists at universities:

  • 94% of University Professors believe they are better at their jobs than their colleagues.
  • 25% of college students think their social skills rank in the top 1%.
  • 70% of 1 million college students surveyed think they are above average in leadership ability, and 2% think they are below average. (See Thomas Gilovich, How We Know What Isn’t So.)

Okay, I agree that saying delusional thinking exists at universities is something like shooting fish in a barrel.  But, we have similar evidence from business:

  • When we use anonymous polling to ask a room full of leaders “I am above average compared to the others in this room”, 80% or more agree.

Here are some other practices we’ve heard people say that might also lead to head-in-the-sand management:

  • “I have an open door policy – no news is good news.”
  • “We run surveys regularly to ask for our employees’ input.  If people don’t bring up things that need improving, this means that things are going well.”
  • “My results are good, so I must be doing the right things.”

So, what can you do differently?

There are at least two factors that promote confirmation bias:

Use of subjective data.  Experience tells us that many 360-reviews, personality tests, performance reviews, and engagement surveys give you data but not solutions.  Using subjective data give a license to interpret the findings any way you like.  And, as discussed above, you can’t be trusted to do the right thing and see constructive data for what it is – a need to change.

A behavioral science approach would have you getting very detailed and pinpointed data instead of the subjective stuff.  It’s much harder to ignore or re-jig the cold, hard facts.

A feedback-scarce environment.  When feedback is limited, it’s easy to believe you’re in the top 1% – everyone’s a winner in that world.  This was the case when I worked at a university – no one ever knew how they compared to others’ performance, so it was easy to believe you were great – even if you weren’t.  This happens in business too: when leaders are too busy doing other things to do what it takes to get good, insightful feedback (both positive and constructive) from their people, it is easy to believe that there are no frustrations and that everything is just grand.

A behavioral science approach to this situation would suggest that you create an environment in which your people understand the type of feedback that you want from them.  This means spending lots of time discussing what insightful feedback looks like, and just how valuable it is to you and the business.

2 Responses to Is Delusional Thinking Killing Your Business?

  1. David Wiss says:

    Good stuff John.

    Confirmation bias is like betting every horse in a race to win, place, and show. This appoarch will provide you with a winner everytime. But in the long haul you will go broke.


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