Tag Archive for: confirmation bias

Reducing Confirmation Bias

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Discover how to improve your decision-making by reducing confirmation bias.

I was convinced that business owners would seize the opportunity to go with me to Normandy for an executive leadership retreat. These bucket-list experiences are game-changing ways to enhance your leadership. I hired a digital marketing firm whose owner loved staff rides. 

I spent over $50k on videos, sales funnels, and ads. We got over 2 million views and 275,000 likes, but not a single buyer.

I was so convinced this retreat would sell itself that I neglected the fundamentals of identifying the ideal client, writing language that appealed to them, and describing how they would be better off. What seemed obvious to me was not so evident to my ideal clients.

What went wrong? Confirmation bias is the tendency to emphasize data confirming your point of view and dismissing contrary information. I had confirmation bias and paid a stiff price for it.

I’m not alone, of course. According to The Wall Street Journal, President Biden, egged on by his inner circle, thinks he could have won the 2024 election and served a full second term. Blockbuster dismissed mail-order videos and streaming. Kodak punted on digital photography. Robert E. Lee ordered the ill-fated Pickett’s charge at Gettysburg.

Internal Viewpoint Diversity, Bold External Perspectives, and Intense Psychological Confidence

One of the most potent ways to improve your decision-making is to reduce unforced errors. You do so by fostering internal viewpoint diversity, bold external perspectives, and internal psychological confidence.

Internal viewpoint diversity, which comes from people having different cognitive strengths and relevant experiences, enhances creativity and reduces the likelihood of groupthink. External perspectives from trusted advisers, customers, and experts help you challenge internal biases and uncover blind spots. Psychological confidence is the willingness to disagree agreeably without fear of retribution.

Missing one of these elements increases the risk of unforced errors. 

Executives entrenched in the film business dominated Kodak’s leadership team. The lack of viewpoint diversity led them to the conclusion that digital photography was only a niche market. They missed the digital boom.

Blockbuster failed to gain external perspectives, so they underestimated people’s growing preferences for convenience and on-demand services. Netflix put them out of business.

Poor psychological confidence is at the heart of Boeing’s crisis. Leaders reportedly dismissed employees’ safety concerns while emphasizing production schedules and cost efficiencies. Highly publicized problems with the 737-MAX and soddy production have damaged the company.

Lee’s overconfidence at Gettysburg resulted from the absence of all three elements. Lee’s subordinates held him in such awe that they were unwilling to question his judgment. Longstreet was the lone general who disagreed with him. Lee dismissed his concerns when no one else backed them. He had no external perspective, especially since Confederate Jefferson Davis stopped questioning Lee’s decisions. 

Had Lee recognized the risk of confirmation bias, he could have encouraged his generals to express fresh ideas and wargame alternatives. The results might have prevented the battle altogether and would have uncovered the faulty assumptions unlying Pickett’s charge. 

When you come with me to Gettysburg and stare across the mile of open ground where Pickett’s charge took place, a potent visual image of confirmation bias sears into your mind. It reminds you to ensure that internal viewpoint diversity, bold external perspectives, and intense psychological confidence inform your decisions. 

Imagine the increase in profitability when you reduce the unforced error tax.

Would you be interested in a meaningful conversation? You and I will hop on a Zoom call. I’ll ask questions to see what I see and then share insights and ideas to help you accelerate your progress.

Decide – stop these common errors from killing off your best moves

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Decide’s Latin origin means to kill off or to sever.

To make a decision thus means to kill off the alternatives.

Common decision-making errors result in you killing off the better alternatives – they are short cuts to expensive failure

Here are two doozies.

Confirmation bias happens when leaders place excessive weight on data that confirms their pre-existing beliefs and discounts contrary information.

We are living this problem right now. 

People on one side of the political spectrum highlight worst-case data on COVID-19. Their opponents emphasize opposite data. 

So many “expert” assessments and statements by political leaders are tainted by confirmation bias that ordinary people like you and me lose faith in their credibility.

It’s not just a political problem.

I fell into the confirmation bias trap myself. 

I wanted to take people on leadership trips to Normandy battlefields. I know the impact these experiences have on leaders and teams, and I’m very good at delivering them.

I wanted to do a lot of good for a lot of people, so I was eager to get going.

I believed that a good social media campaign could lead to mass interest.

A digital marketing agency I hired felt the same and suggested that Facebook ads would be a winner. They had had success with Facebook ads before, with a life-coach. They believed that they could replicate the outcomes. 

We made a series of (really cool) videos, created a complicated sales funnel, and crafted the ads carefully. 

We launched the ads. The videos were really popular and we saw superb engagement rates.

No prospects. 

We needed to create enough volume, we told ourselves, and the ads would pay off. Even if only .1 percent were interested, one million views should lead to 1000 prospects. 

We spent more.

We got nearly 2 million views and 300k “likes.” 

No prospects. No buyers.

I finally shut off the ads.

It turns out that we had tapped into an audience that loved military history, but they were not leaders or buyers.

Most entrepreneurs and leaders go to Facebook to keep up with friends and family, not for business advice.

That was an expensive lesson. 

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We will discuss decision-making and seven more steps to nailing your next 100-days during my free masterclass.  

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Status quo bias, on the other hand, increases resistance to change, even if your situation sucks and your plan is failing.

Leaders perceive that the status quo is safe. After all, the executive team signed up for the approach at one time.  

Board members or executives poke holes in alternatives, shoot-down proposals, and emphasize the risks of change.

Some resist change for fear of being “wrong” in adopting the current plan. 

Others do not have an apples-to-apples comparison of risk, so they place more confidence in managing the challenges of the failing plan they know than in a proposed alternative that they don’t. 

Solo-entrepreneurs and small business leaders with status quo bias make a decision one day and then talk themselves out of moving forward the next morning. 

You get trapped in the hamster wheel.

Here are two action steps to deal with these problems.

First, assess your assumptions. 

Ask “what must be true” for the plan to work. Those are your assumptions. 

Do a sanity check on the validity of the assumptions.

Do the same with alternate plans. 

This approach gives you an apples-to-apples comparison of the risks and opportunities.

It also helps you check your confirmation bias.

Second, use premortems.

A premortem is a story or two about how the plan failed so that you can identify the indicators and warnings. 

Make those indicators and warnings part of your risk assessment.

When the indicators and warnings light up in the wrong direction, you know it’s time to make a change.

Red-teams or designated critics can be helpful, too, but I prefer the pre-mortems. 

Leaders may rationalize away the former because they are supposed to point out problems. 

They go with the plan anyway and lose the benefit of the premortem’s indicators and warnings.

The premortem is something the decision-makers own, so they are more likely to take them seriously.

We will discuss decision-making and seven more steps to nailing your next 100-days during my free masterclass.  

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Sign up now while this article is in front of you. You are one decision away from making even better decisions :0). 

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What is your top takeaway from this article? 

P.S. Do you want to nail your next 100 days? Of course, you do. Here’s the free training that will help you do exactly that. It’s perfect for solo-entrepreneurs, consultants, and micro-business owners.

You are one decision away from nailing your next 100 days.