To close out this week's topic, I look at two articles from yesterday's post in greater detail. I also provide some final tips on how to reduce the effects of these heuristics and cognitive biases.
From the articles below, we have four biases that leaders and managers should be keenly aware of.
Overconfidence - Bias in favor of the opinions of executive leadership based on past success. A good track record is important, but it does not guarantee future results, especially in an evolving business landscape.
Discipline and experience are intangible competitive advantages, but so is your team. Seek out their advice and feedback.
Make sure to follow your systems and decision architecture while also listening to your "gut".
Confirmation Bias - We discussed confirmation bias in Part 1, but it often appears with other biases disguised as support for a particular outcome or option.
Take time to fully consider your options. Binary choices are often not so limited. And have you thoroughly tested your choice?
Groupthink/Herding – Again, we discussed these in Part 1, "Everyone is doing it!", but in this instance it ties in with our first two examples. When Overconfidence and Confirmation Bias appear in businesses and team, Groupthink is often a result.
Salience Bias - Salience Bias is similar to availability bias in that we're over-weighting recent or easily recalled information. For leaders in the information age, when new data arrives constantly and in many forms, it is vital to overcome this bias.
As we discussed in Part 1, "Paralysis by Analysis" is an easy trap to fall into because of this bias, as you constantly consider new information rather than move on to a decision.
And in the event the data is not actually relevant, your actions will be based on bad data.
Combined together, this group of cognitive biases and heuristics can lead to executives and managers over-utilizing Command & Control management. When this happens, and Groupthink creeps in, you can wind up with a "yes man" culture that lacks creativity and avoids providing quality feedback.
Needless to say, this is not a recipe for great decision making. What can you do?
Set up, and regularly revisit, your internal systems and decision architecture, and follow and trust your process. First and foremost, have your systems and habits in place that are going to move you toward your goals and objectives.
To help you slow down and gain perspective, consider incorporating mindfulness into your daily routine.
This might mean trying different inputs and getting out of your comfort zone.
Finally, the Ascent Reading List has a number of great books to help leaders better understand data and decision making, in addition to the articles below.
Missed the first two episodes?
In Part 1, Matt gave us the definition, and 5 examples, of cognitive biases and heuristics.
In Part 2, Matt discussed the most common business example of cognitive biases, and also discussed how leaders can create new habits that will reduce the effect of cognitive biases and improve decision making.
Additional Reading & Referenced Articles
About the Author:
Matt Beckmann is the Founder & Managing Director of Ascent Consultants. In addition to experience as a former Chief of Staff to the Missouri Auditor and as a Corporate Vice President and General Counsel, he has advanced training and certifications in law, business, coaching, athletics, and leadership. His blog content, inspired by his deep passion for unlocking his reader's best potential, consistently equips business owners and individuals with the knowledge and resources to overcome obstacles that may be hindering growth.
Ascent Consultants provides business and strategy consulting, executive and leadership coaching, and leadership assessments. By converting client growth goals into an actionable "game plan," we help companies and individuals unlock their full potential.
