For the past several weeks I’ve been detailing a series of mental models of decision-making, examples of short cuts to enable us to manage better. Thinking more about these mental models, I thought further to realise that in our business lives, we are challenged by four BIG issues;
- We don’t see everything; because there’s just too much data. Some of the information we filter out is actually useful and important.
- Our search for meaning can conjure illusions; because we deliberately try to look for meaning in all this data. We sometimes imagine details that were filled in by our assumptions, and construct meaning and stories that aren’t really there.
- Quick decisions can be seriously flawed; but we need to act fast Some of the quick reactions and decisions we jump to are unfair, self-serving, and counter-productive.
- Our memory reinforces errors; but what are the things we should we remember. Some of the stuff we remember for later just makes all of the above systems more biased, and more damaging to our thought processes.
The first step in approaching these challenges is to keep in mind that there are likely to be issues as we navigate through decision making.
The second step is to know WHY our minds are biased, and work with our natural tendencies rather than fighting against them.
By keeping these four problems and their four causes in mind, the availability heuristic will ensure that we notice our own biases more often becoming more and more aware of our thinking processes.
But thinking deeper, every cognitive bias we exhibit does exist for a reason— primarily they are to save our overworked brains time and energy when it’s faced with information overload, lack of meaning, the need to act fast, and how to know what needs to be remembered for later.
So here’s a quick review of how each of the natural biases we have links together
Problem 1: Too much data- so what attracts our interest?
In the pre-industrial age, there wasn’t so much information around, but since industrialisation and now the internet age there has been an explosion of data, and we can access it ALL. So, we are faced with just too much information in the world; we have no choice but to filter almost all of it out. Our brain uses a few simple tricks to pick out the bits of information that are most likely going to be useful in some way, knowing what bits are likely to be highlighted ensures you are less likely to filter out the useful stuff
- We notice things that are already primed in our memory or repeated often. This is the simple rule that our brains are more likely to notice things that are related to stuff that’s recently been loaded in memory.
See: Availability heuristic, Attentional bias, Illusory truth effect, Mere exposure effect, Context effect, Cue-dependent forgetting, Mood-congruent memory bias, Frequency illusion, Baader-Meinhof Phenomenon, Empathy gap, Omission bias, or the Base rate fallacy.
- We are drawn to details that confirm our own existing beliefs. This is a big one. As is the corollary: we tend to ignore details that contradicts our own beliefs.
See: Confirmation bias, Congruence bias, Post-purchase rationalization, Choice-supportive bias, Selective perception, Observer-expectancy effect, Experimenter’s bias, Observer effect, Expectation bias, Ostrich effect, Subjective validation, Continued influence effect, or Semmelweis reflex.
- Bizarre/funny/visually-striking/anthropomorphic things stick out more than non-bizarre/unfunny things. Our brains tend to boost the importance of things that are unusual or surprising, thats why certain types of advertising really works, and why we are attracted to kitten and puppy memes on facebook. Alternatively, we tend to skip over information that we think is ordinary or expected.
- We notice when something has changed—and we’ll generally tend to weigh the significance of the new value by the direction the change happened (positive or negative) more than re-evaluating the new value as if it had been presented alone. This also applies to when we compare two similar things.
- We notice flaws in others more easily than flaws in ourselves. Yes, before you see this entire article as a list of quirks that compromise how other people think, realize that you are also subject to these biases.
Problem 2: Not enough meaning – so how do we ascribe meaning?
The world is very confusing, and we end up only seeing a tiny sliver of it—but we need to make some sense of it in order to survive. Once the filtered stream of data comes in, we connect the dots to create information, fill in the gaps with stuff we already think we know, and update our mental models of the world.
- We deliberately create stories and patterns even in sparse data. Since we only get a tiny sliver of the world’s information, and also filter out almost everything else, we never have the luxury of having the full story. This is how our brain reconstructs the world to feel complete inside our heads.
See: Confabulation, Clustering illusion, Insensitivity to sample size, Neglect of probability, Anecdotal fallacy, Illusion of validity, Masked man fallacy, Recency illusion, Gambler’s fallacy, Hot-hand fallacy, Illusory correlation, Pareidolia, or Anthropomorphism.
- We fill in these characteristics from inbuilt stereotypes, generalities, and prior histories whenever there are new specific instances or gaps in information. When we have partial information about a specific thing that belongs to a group of things we are pretty familiar with, our brain has no problem filling in the gaps with best guesses or what other trusted sources provide. Conveniently, we then forget which parts were real and which were filled in.
See: Group attribution error, Ultimate attribution error, Stereotyping, Essentialism, Functional fixedness, Moral credential effect, Just-world hypothesis, Argument from fallacy, Authority bias, Automation bias, Bandwagon effect, or the Placebo effect.
- We imagine things and people we’re familiar with or fond of as better than things and people we aren’t familiar with or fond of. Similar to the above, but the filled-in bits generally also include built-in assumptions about the quality and value of the thing we’re looking at.
- We simplify probabilities and numbers to make them easier to think about. Our subconscious mind is terrible at math not because we are dumb but because our brains are lazy and generally we get all kinds of things wrong about the likelihood of something happening if any data is missing.
- We think we know what others are thinking. In some cases this means that we assume that they know what we know, in other cases we assume they’re thinking about us as much as we are thinking about ourselves. It’s basically just a case of us modelling their own mind after our own (or in some cases, after a much less complicated mind than our own).
- We project our current mindset and assumptions onto the past and future. Magnified also by the fact that we’re not very good at imagining how quickly or slowly things will happen or change over time.
See: Hindsight bias, Outcome bias, Moral luck, Declinism, Telescoping effect, Rosy retrospection, Impact bias, Pessimism bias, Planning fallacy, Time-saving bias, Pro-innovation bias, Projection bias, Restraint bias, or the Self-consistency bias.
Problem 3: The need to act fast- so how do we make these decisions?
We’re constrained by time and information, and yet we can’t let that paralyse us. Without the ability to act fast in the face of uncertainty, we surely would have perished as a species long ago. With every piece of new information, we need to do our best to assess our ability to affect the situation, apply it to decisions, simulate the future to predict what might happen next, and otherwise act on our new insight.
- In order to act, we need to be confident in our ability to make an impact and to feel like what we do is important. In reality, most of this confidence can be classified as overconfidence, but without it we might not act at all.
See: Overconfidence effect, Egocentric bias, Optimism bias, Social desirability bias, Third-person effect, Forer effect, Barnum effect, Illusion of control, False consensus effect, Dunning-Kruger effect, Hard-easy effect, Illusory superiority, Lake Wobegone effect, Self-serving bias, Actor-observer bias, Fundamental attribution error, Defensive attribution hypothesis, Trait ascription bias, Effort justification, Risk compensation, or the Peltzman effect.
- In order to stay focused, we favour the immediate, relatable thing in front of us, over the delayed and distant. We value stuff more in the present than in the future, and relate more to stories of specific individuals than anonymous individuals or groups. I’m surprised there aren’t more biases found under this one, considering how much it impacts how we think about the world.
- In order to get anything done, we’re motivated to complete things that we’ve already invested time and energy in. The behavioural economist’s version of Newton’s first law of motion: an object in motion stays in motion. This helps us finish things, even if we come across more and more reasons to give up.
See: Sunk cost fallacy, Irrational escalation, Escalation of commitment, Loss aversion, IKEA effect, Processing difficulty effect, Generation effect, Zero-risk bias, Disposition effect, Unit bias, Pseudocertainty effect, Endowment effect, or the Backfire effect.
- In order to avoid mistakes, we’re motivated to preserve our autonomy and status in a group, and to avoid irreversible decisions. If we must choose, we tend to choose the option that is perceived as the least risky or that preserves the status quo. Better the devil you know than the devil you do not.
- We favour options that appear simple or that have more complete information over more complex, ambiguous options. We’d rather do the quick, simple thing than the important complicated thing, even if the important complicated thing is ultimately a better use of time and energy.
Problem 4: What should we remember – if our memory creates all these biases and misinformation?
There’s too much data in the universe and we often create incorrect patterns and messages from it. We can only afford to keep around the bits that are most likely to prove useful in the future. We need to make constant bets and trade-offs around what we try to remember and what we forget. For example, we prefer generalisations over specifics because they take up less space. When there are lots of irreducible details, we pick out a few standout items to save, and discard the rest. What we save here is what is most likely to inform our filters related to information overload (problem #1), as well as inform what comes to mind during the processes mentioned in problem #2 around filling in incomplete information. It’s all self-reinforcing.
- We change, edit and reinforce some memories after the fact. During that process, memories can become stronger, however various details can also get accidentally swapped. We sometimes accidentally inject a detail into the memory that wasn’t there before to make it seem more coherent, or to ensure we think we are acting appropriately.
- We discard specifics to form generalities. We do this out of necessity, but the impact of implicit associations, stereotypes, and prejudice results in some of the most glaringly bad consequences from our full set of cognitive biases.
- We reduce events and lists to their key elements. It’s difficult to reduce events and lists to generalities, so instead we pick out a few items to represent the whole.
See: Peak–end rule, Leveling and sharpening, Misinformation effect, Duration neglect, Serial recall effect, List-length effect, Modality effect, Memory inhibition, Part-list cueing effect, Primacy effect, Recency effect, Serial position effect, or the Suffix effect.
- We store memories differently based on how they were experienced. Our brains will only encode information that it deems important at the time, but this decision can be affected by other circumstances (what else is happening, how is the information presenting itself, can we easily find the information again if we need to, etc.) that have little to do with the information’s value.
Great, how am I supposed to remember all of this?
You can start by remembering these four giant problems our brains have evolved to deal with over the last few million years (and maybe bookmark this page if you want to occasionally reference it for the exact bias you’re looking for):
- Information overload sucks, so we aggressively filter.
- Lack of meaning is confusing, so we fill in the gaps.
- We need to act fast lest we lose our chance, so we jump to conclusions.
- This isn’t getting easier, so we try to remember the important bits.
In order to avoid drowning in information overload, our brains need to skim and filter insane amounts of information and quickly, almost effortlessly, decide which few things in that firehose are actually important, and call those out.
In order to act fast, our brains need to make split-second decisions that could impact our chances for survival, security, or success, and we need to feel confident that we can make things happen.
And in order to keep doing all of this as efficiently as possible, our brains need to remember the most important and useful bits of new information and inform the other systems so they can adapt and improve over time, but make sure to remember no more than that.
Nothing we do can make the four problems go away (until we have a way to expand our minds’ computational power and memory storage to match that of the universe), but if we accept that we are permanently biased—and that there’s room for improvement—confirmation bias will continue to help us find evidence that supports this, which will ultimately lead us to better understanding of ourselves.