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Published on February 7, 2020

9 Types of Bias That Cloud Our Everyday Judgement

9 Types of Bias That Cloud Our Everyday Judgement

Do you consider yourself to be an objective, unbiased thinker? I think it’s safe to say that most people assume they are. We think we’re able to weigh all sides equally and reach logical, unbiased conclusions.

What most people don’t know is that there are many types of bias that prevent us every single day from doing exactly that.

Psychologists continue to find new types of bias that cloud our judgment and prevent us from reaching the fairest, most accurate conclusions. For example, the overestimation bias has only recently been named and defined. That’s when you overestimate how much other people will enjoy or dislike something. With the overestimation bias, we know how we feel about various pros and cons, so we allow ourselves to have a nuanced perspective on something while assuming others will simply like or hate it more than us. [1]

For example, we overestimate how much someone else would like a tropical vacation because we know how we will feel about the mosquitos and the sunburn, but we don’t think about others having that same nuanced ambivalence. Or we overestimate how much someone would dislike drinking hot sauce from the bottle. Again, we can weigh the pros and cons for ourselves but not for others, so we tend to think people will dislike distasteful things more than we do.

The overestimation bias is just one of many types of bias, and there is an easy way to adjust our thinking to not fall prey to it — By knowing about the overestimation bias, we are better able to reach fairer, more accurate conclusions about how much or how little people will enjoy things.

Knowing about the bias will help you think more carefully the next time you buy someone a gift or determine the price others are willing to pay for something you’re selling. You’ll be better equipped to take a more nuanced view of how others will be thinking about that gift or product and, therefore, better equipped to compensate for the overestimation bias.

Let’s take a look at 9 other common types of bias and how you can be mindful of them and not let them cloud your judgment.

1. Anchoring Bias

We tend to put more weight on the first piece of information we hear. Imagine you are selling your house. The first offer you receive is for $50,000 less than your asking price. The anchoring bias says that you will put more weight, give more importance, to this offer because it is the first.[2] This first offer is more likely to change your mind about how much your house is worth than any future offer.

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How to Be Less Biased

The anchoring bias often involves money and what we think things are worth, so it’s important to keep it in mind when making financial decisions. Know that the first piece of information you receive does not have any more importance than the fifth.

You can also get the upper hand in negotiations by establishing the first offer. Because of the anchoring bias, this will have a better chance of swaying how much the other person thinks what you’re buying or selling is worth.

2. Availability Heuristic

The availability heuristic is a fancy way of saying that we overestimate the importance of whatever information we have easy access to.[3] We rely too much on examples that come to our minds quickly, instead of weighing all information equally.

Watching the news is one example of this type of bias. We see many more stories about violence and disaster, so we’re much more likely to think that the world is dangerous even though we could do some easy googling to see that the world is actually safer in many ways than it was decades ago.

How to Be Less Biased

Again, knowledge is power when dealing with the availability heuristic. Remind yourself that anecdotal evidence is not statistically relevant in decision-making. Your Aunt Sue winning the lottery in no way improves your odds of winning big.

3. Bandwagon Effect

When we’re talking about types of bias, the bandwagon effect is a fairly common one. We’re more likely to be swayed the more people around us think a certain way.[4]

Think about serving on a jury. If in the initial vote, everyone says guilty except you, you’re much more likely to also think the defendant is guilty. The bandwagon effect looks a lot like peer pressure.

How to Be Less Biased

Stick to the facts. Know that people thinking a certain way doesn’t make them right, even if lots of people think that same way.

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4. Confirmation Bias

The confirmation bias may be the most common type of bias. It’s when people only listen to information that confirms what they already believe.

Social media is like confirmation bias heaven. Think about your Uncle Steve who loves Political Candidate A. He only watches news and shares posts about how great his candidate is. This creates an echo chamber where any information to the contrary is avoided.

How to Be Less Biased

Listen to the counterargument and seriously consider it. If you only watch Fox News, start checking out MSNBC. If you only read The New York Times, start reading The Wall Street Journal. The more we seriously consider other perspectives, the more likely we are to reach a better conclusion.

Learn more about this here: What Is Confirmation Bias in Psychology and What to Do About It

5. Dunning-Kruger Effect

The Dunning-Kruger Effect explains why the more you know about something, the less confident you are in your expertise. On the other hand, the less you know, the more simplistic your understanding is. Therefore, you are more confident in your grasp of something.[5]

How to Be Less Biased

If you find yourself being extremely confident about your expertise in something, take a step back and focus on what you don’t yet know or understand.

Aim for complexity. If something seems too simple, the problem is probably that you don’t yet know enough for it to be complex.

6. Fundamental Attribution Error

The fundamental attribution error is when you make contextual excuses for your own mistakes and failings but don’t do so for others.

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The most famous example is bad driving. If we are swerving all over the road, we’re quick to take a nuanced view of our own driving. We know that we’re just having a bad morning or that we have a lot on our minds today.

However, when we see another so-called bad driver, the fundamental attribution error means we’re quick to blame their driving on the fact that they’re old or a woman or some other stereotype or generalization, even though the other driver’s situation is just as nuanced as our own.

How to Be Less Biased

Any time you stereotype someone based on their flaws, check yourself. You have probably fallen victim to the fundamental attribution error.

Tell yourself that they are probably having a bad day or that you simply don’t know what their situation is. If you’re allowed to be nuanced and complex, so should they.

7. In-Group Bias

In-group bias is similar to the fundamental attribution error, but instead of thinking we are better than others, we think members of our group are better than members of other groups. We have a more favorable view of the people in our group just because they are in our group.

How to Be Less Biased

Just like with the fundamental attribution error, you need to actively think about the nuance and complexity of people outside of your group if you want to compensate for your in-group bias.

8. Optimism/Pessimism Bias

The next bias is really two different types of bias. The optimism bias is when you are more likely to think things will turn out well when you’re in a good mood. Whereas, the pessimism bias is when you’re more likely to think things will turn out badly when you’re in a bad mood.

How to Be Less Biased

Become emotionally intelligent. If you want to compensate for these types of bias, know and understand what you’re currently feeling and save important decisions for when you’re in a more beige mood.

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9. Selective Perception

This bias explains why some people seem to only see what they want to see. Selective perception is all about our expectations affecting our perception.

For example, you might expect your friend to do well in their presentation because they’re your friend and you think they’re amazing. Selective perception is the reason you may not notice all your friend’s mistakes but notice all the other presenters’ errors.

How to Be Less Biased

Keep your expectations in check to avoid selective perception. You may even want to pretend you don’t have any expectations. To put it simply, be aware of all types of bias and try your best to keep an open mind about everything.

Final Thoughts

One final bias gives us the best remedy for combatting all other types of bias: the blindspot bias. The blindspot bias explains why people notice other people’s cognitive biases but fail to notice their own.

So the best solution for overcoming all types of bias is to take a long, hard look in the mirror. Educate yourself about types of bias and then do a thoughtful inventory about your own biases.

And if you don’t think you have any biases, keep looking in the mirror because that’s your blindspot bias talking. Just like the rest of us, you have biases. But being aware of them and introspective about the way they affect your decision-making is a good way to not let them have the final word.

More on Thinking Clearly

Featured photo credit: Jan Tinneberg via unsplash.com

Reference

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Clay Drinko

Clay Drinko is an educator and the author of PLAY YOUR WAY SANE (January 2021 Simon & Schuster)

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Published on July 29, 2020

How to Build Strategic Thinking Skills for Effective Leadership

How to Build Strategic Thinking Skills for Effective Leadership

Have you been thinking of how you can be a more strategic leader during these uncertain times? Has the pandemic thrown a wrench at all your carefully laid out plans and initiatives?

You’re not alone. The truth is, we all want some stability in our careers and teams during this disruptive pandemic.

However, this now requires a bit more effort than before and making the leap from merely surviving to thriving means buckling down to some serious strategic thinking and maintaining a determined mindset.

Is There a Way to Thrive Despite These Disruptions?

Essentially – yes, although you need to be willing to put in the work. Every leader wants to develop strategic thinking skills so that they can enhance overall team performance and boost their company’s success, but what exactly does it mean to be strategic in the context of the times we live in?

If you happen to be in a leadership position in your organization right now, you are most probably navigating precarious waters given the disruptions caused by the pandemic. There’s a lot more pressure than before because your actions and decisions will have a much greater impact these days not just on you, but also to the people who are part of your team.

Companies often bring me in to coach executives on strategic thinking and planning. And while pre-pandemic I would usually start by highlighting the advantages of strategic thinking, nowadays, I always begin these Zoom coaching sessions by driving home the point that this pandemic has now made strategic thinking not just an option but an absolute must.

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Assessing and making plans through the lens of a good strategy might require significant work at first. Nevertheless, you can take comfort in the fact that the rewards will far outweigh the effort, as you’ll soon see after following the 8 strategic steps I have outlined below.

8 Steps to Strategic Thinking

As events unfold during these strange times, you’re bound to feel wrong-footed every now and then. Being a leader during this pandemic means preparing for more change not just for you, but for your whole team as well.

As states and cities go through a cycle of lockdowns and reopening, employees will experience the full gamut of human emotions in dizzying speed, and you will often be called on to provide insight and stability to your team and workplace.

Strategic thinking is all about anticipation and preparation. Rather than expending your energy merely helping your company put out fires and survive, you can put the time to better use by charting out a solid plan that can protect and help you and your company thrive.

Take the following steps to build solid initiatives and roll out successful projects:

Step 1: Step Back, Then Set the Scope

One of the things that leaders get wrong during their first attempt at strategic thinking is expecting that it is just another item on a checklist. The truth is, you need to take a good, long look at the bigger picture before anything else. This means decisively prioritizing and stepping away from tasks that can be delegated to others. Free up your schedule so you can focus on this crucial task at hand.

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Then, proceed with setting the scope and the strategic goals of the project or initiative you plan to build or execute. Ask yourself the bigger question of why you need to embark on a particular project and when would be the right time to do so.

You need to set a timeline as well, anywhere from 6 months to 5 years. Keep in mind that your projections will deteriorate the further out you go as you make longer-term plans.

For this reason, add extra resources, flexibility, and resilience if you have a longer timeline. You should also be making the goals less specific if you’re charting it out for the longer term.

Step 2: Make a List of Experts

Make and keep a list of credible people who can contribute solid insight and feedback to your initiative. This could range from key stakeholders to industry experts, mentors, and even colleagues who previously planned and rolled out similar projects.

Reach out to the people on this list regularly while you work through the steps to bring diverse insight into your planning process. This way, you will be able to approach any problem from every angle.

Bringing key stakeholders into this initial process will also display your willingness to listen and empathize with their issues. In return, this will build trust and potentially pave the way for smoother buy-in down the line.

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Step 3: Anticipate the Future

After identifying your goals and gathering feedback, it’s time to consider what the future would look like if everything goes as you intuitively anticipate. Then, lay out the kind and amount of resources (money, time, social capital) that might be needed to keep this anticipated future running.

Step 4: Brainstorm on Potential Internal and External Problems

Next, think of how the future would look if you encountered unexpected problems internal and external to the business activity that seriously jeopardize your expected vision of the future. Write out what kind of potential problems you might encounter, including low-probability ones.

Assess the likelihood that you will run into each problem. To gauge, multiply the likelihood by the number of resources needed to address the problem. Try to convert the resources into money if possible so that you can have a single unit of measurement.

Then, think of what steps you can take to address these internal and external problems before they even happen. Write out how much you expect these steps might cost. Lastly, add up all the extra resources that may be needed because of the different possible problems and all the steps you committed to taking to address them in advance.

Step 5: Identify Potential Opportunities, Internal and External

Imagine how your expected plan would look if unexpected opportunities came up. Most of these will be external but consider internal ones as well. Then, gauge the likelihood of each scenario and the number of resources you would need to take advantage of each opportunity. Convert the resources into money if possible.

Then, think of what steps you can take in advance to take advantage of unexpected opportunities and write out how much you expect these steps might cost. Finally, add up all the extra resources that may be needed because of the different unexpected opportunities and all the steps you committed to taking to address them in advance.

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Step 6: Check for Cognitive Biases

Check for potential cognitive biases that are relevant to you personally or to the organization as a whole, and adjust the resources and plans to address such errors.[1] Make sure to at least check for loss aversion, status quo bias, confirmation bias, attentional bias, overconfidence, optimism bias, pessimism bias, and halo and horns effects.

Step 7: Account for Unknown Unknowns (Black Swans)

To have a more effective strategy, account for black swans as well. These are unknown unknowns -unpredictable events that have potentially severe consequences.

To account for these black swans, add 40 percent to the resources you anticipate. Also, consider ways to make your plans more flexible and secure than you intuitively feel is needed.

Step 8: Communicate and Take the Next Steps

Communicate the plan to your stakeholders, and give them a heads up about the additional resources needed. Then, take the next steps to address the unanticipated problems and take advantage of the opportunities you identified by improving your plans, as well as allocating and reserving resources.

Finally, take note that there will be cases when you’ll need to go back and forth these steps to make improvements, (a fix here, an improvement there) so be comfortable with revisiting your strategy and reaching out to your list of experts.

Conclusion

A great way to deal with feelings of uncertainty during this pandemic is to anticipate obstacles with a good plan – and a sure road to that is practicing strategic thinking.

In the coming months and years, you’ll need to continue navigating uncharted territory so that you can lead your team to safe waters. Regularly doing these 8 steps to strategic thinking will ensure that you can prepare for and adapt  to the coming changes with increasing clarity, perspective, and efficiency.[2]

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