11 takeaways from this talk:
00:01:01 Communication is the key to doing a good job. Cognitive biases are “systematic patterns of deviation from norm or rationality in judgment, whereby inferences about other people and situations may be drawn in an illogical fashion.”
Several notable books on the subject include:
- Predictably Irrational: The Hidden Forces That Shape Our Decisions by Dan Ariely
- Nudge: Improving decisions about Health, Wealth, and Happiness by Richard Thaler
- Thinking, Fast and Slow by Daniel Kahneman
- The Black Swan: The Impact of The Highly Improbable by Nassim Nicholas Taleb
[EDITOR’S NOTE: Recall in the lecture Managing Age, Cultural & Personality Differences, Jerks & Assholes and in the BBC documentaries Superbrand Secrets From The Fashion Industry and The Technology Industry that most human behavior is driven by unconscious brain processes.
Humans do things, and for the most part they have no idea why they are doing them. Your neocortex is the puppet, and your limbic system is the puppet master.]
00:03:32 A lot of what humans do is to blend data with their ‘gut instinct,’ then make decisions based on that pairing; meaning you come up with an idea and then put it out into the world, and if it fails (which most business ideas do) you don’t know if you have a bad idea, or if you have a great idea that’s been poorly executed, and that with a few minor modifications could turn your failing idea into a cash cow.
As such, everyone, regardless of their level of intelligence, can fall victim to a cognitive bias because there is simply no way for you to realize they are impairing your judgment one until someone points it out to you. Your best defense against cognitive biases is to:
- Be familiar with cognitive biases so that you can recognize one you see one
- Be able to address other people’s cognitive biases without putting them on the defensive
- Be able to identify when you yourself are victim to a cognitive bias
8 cognitive biases that ruin your workplace:
00:04:57 The confirmation bias is the tendancy for humans to ignore or reject information that proves them wrong, while noticing and remembering information that proves them right. This occurs to the point where you will physically shut down and be repulsed by information you disagree with, yet cannot avoid.
The hardest part about this bias is noticing that you are discriminating against data. One dead giveaway is becoming unnecessarily annoyed during a conversation with a person, it could be that one or both of you have a confirmation bias, or that one or both of you simply aren’t explaining yourselves correctly.
[EDITOR’S NOTE: Recall in Deepak Malhotra’s lecture 20 Tips to Better Negotiate Your Job Offer & Compensation Package at Harvard University that at every stage in a discussion, whenever someone asks you a question, or says something ambiguous or that you weren’t expecting, investigate and ask for clarification so you understand the situation. The better you understand the situation, the more wisely you can respond to it.
Also, for more information on how to ask people questions to get to the root of the issue, read my interview with Brand Listener Peter Spear.]
00:09:28 Cognitive Dissonance is the tendancy for humans to justify themselves when they “hold two or more contradictory beliefs, ideas, values, or behaviors at the same time.” For example knowing smoking is bad for you and will kill you prematurely, yet still you smoke a pack of cigarettes a day, or an abusive husband who considers himself to be a good person, and so concocts beliefs to justify why he is a good man and why his behavior was necessary.
Your brain will actually go so far as to reorder the facts or timeline of a story to fit into the moral of the story you want to tell.
In the workplace, you may never find out the cognitive dissonance behind why a person is making a business decision that seems to go against common sense or the company’s best interest, but what you can do is turn the discussion towards the weaknesses behind the decision, such as the statistics, consumer insight, or logic used to come to the decision. You may even uncover a confirmation bias (mentioned above).
[EDITOR’S NOTE: To learn how cognitive dissonance can be used to treat military with Posttramatic Stress Disorder (PTSD), read the book Redirect: Changing The Stories We Live By by Timothy Wilson.]
00:13:04 The Choice Support Bias is the idea that humans would rather defend poor decisions they have made than admit that they were wrong, or didn’t put enough thought into the decision; nobody likes admitting they made a mistake, especially if the mistake was a novice, noob mistake.
[EDITOR’S NOTE: Recall again in Deepak Malhotra’s lecture 20 Tips to Better Negotiate Your Job Offer & Compensation Package at Harvard University that people will only change their behavior and decisions when they can do so without losing face and looking stupid. So never corner a person into that situation, allow them to save face by using the cognitive dissonance bias to explain their way out of a previous bad decision.]
00:14:00 The halo effect is the tendancy for a humans opinion of a person or product to spill over into other non-related aspects of the person or product. For example the fact that being 1 inch taller can earn you $800 more a year, or that models are naturally happier.
Priming is “a process in which the processing of a target stimulus is aided or altered by the presentation of a previously presented stimulus.” When humans see things that they have been primed to like, the pleasure centers in their limbic system responsible for reward, craving and addiction activate. Connect one stimulus with another enough times, and the brain unconsciously connects the two. So much so that even the way you organize a list can drastically change your opinion of the elements in the list.
In the workplace, the CEO’s idea must be the best idea, otherwise why would he be the CEO? Likewise, if you begin by talking about all the reasons an idea is a bad idea before point out the good reasons, you’ll have already primed the person into disliking the idea, and vice versa.
[EDITOR’S NOTE: In his book What They Don’t Teach You at Harvard Business School: Notes From a Street-Smart Executive, the late Mark McCormack advises you to use the halo effect to your advantage by developing a reputation for producing quality, because that reputation for quality can be transferred into so many other aspects in life.]
In the workplace, ways of overcoming the halo effect could be:
- Through anonymous idea submission or having other people than the idea’s creator propose the idea.
- By challenging the source of the information. Would the CEO’s idea carry the same weight were it given to you by another source?
00:18:39 The observational bias is the tendancy for humans to unconsciously and partially remember bits and pieces of an event, with the rest being forgotten or misremembered. Further, the more you notice one particular aspect, the more likely you are to consider that particular aspect to be more important.
The more you hear something, the more credible, plausible, and dependable the information appears to be. Take the time to research and confirm it before you just act on it.
00:22:00 The social proof bias is the tendancy for humans to “assume the actions of others in an attempt to reflect correct behavior for a given situation. This effect is prominent in ambiguous social situations where people are unable to determine the appropriate mode of behavior, and is driven by the assumption that surrounding people possess more knowledge about the situation.”
Don’t automatically assume that because a person has carefully and intentionally decided upon a decision, or that a website has been intentionally organized using the best means of research available to them. It’s quite possible that they were simply copying another person whom they also assumed put a lot of thought into their decisions.
00:25:28 The negativity bias is the tendancy for humans to allow negative information and thoughts to “have a greater effect on one’s psychological state and processes than do neutral or positive things.” Meaning humans consider negative information more important than positive information in their decision making process.
In the workplace, colleagues, bosses and clients will remember negative information more, and will do everything they can to avoid negative interactions.
For every negative comment you make, you need to make 5 positive comments to bring equality back into your relationship.
[EDITOR’S NOTE: This 5:1 ratio is also noted in Frank Conner’s lecture The Psychology of Love & Phases of The Breakup Process.]
00:28:50 In the workplace, get the person who is against you to do you a favor while simultaneously treating that person with mutual respect, and that person will probably grow to like you. Why? Because recall that cognitive dissonance (above) states that when a person has two contradictory opinions, that person will find a way to justify why they have the differing opinions, and seek to bring them into alignment. By having agreed to do you a favor, the person reasons that you can’t be so bad, otherwise they wouldn’t have agreed to do something for you, and so therefore unconsciously reason that because they did something for you, they must in fact like you.
00:30:31 The bias blind spot is the tendancy for humans to notice failures and shortcomings in everyone but themselves. It is only by understanding the other biases can you then begin analyzing your own behaviors and thought processes and recognize the biases in yourself.
00:35:30 When it comes to using these biases against users to grow your business, there is a difference between companies that make products consumers really want to use, and companies that use marketing/advertising-based approaches to force their products onto consumers.
As an entrepreneur creating a new product, you’ll obviously need an element of marketing so consumers know you exist, but my advice would be to strive to make products that change people’s lives and behavior for the better.