Rationality Is an Illusion

Illusion of Rationality

As mature adults and business professionals, we like to claim we approach life rationally. However, the evidence is stacked against us. We err either on being too optimistic or too pessimistic. We take too long to cut losses on bad investments or unhealthy relationships. We regularly make statements like, “I know this is bad for me, but…” We have long lists of phobias. You get the picture. Even the most rational among us cannot be 100% rational.

Why is this?

Rationality is an illusionFirst, our perception is not necessary reality. If you have ever seen a magic act, 3D sidewalk artist, or flipped through a book of optical illusions you have experienced this truth. Our brains are wired to try to make sense of the complex world around us. Add to that the ways our eyes work with our brain to process sight, and you have a fun world of parlor tricks.

However, our brains don’t stop filling in gaps and jumping to conclusions just because we aren’t being entertained by an illusion. It’s not something we can turn off. It is neurologically impossible for us to understand and process everything going on around us. We can’t even process everything our eyes see. Our brains are constantly making decisions on what information to keep and what to ignore. Our brains are also adding information to make incomplete information make sense.

Try to read the following paragraph. Even if you struggle with the first few words, keep pressing on. You might be amazed.

Fi yuo cna raed tihs, yuo hvae a sgtrane mnid too. cna you raed tihs? Olny smoe plepoe can. I cdnuolt blveiee taht I cluod aulaclty uesdnatnrd waht I was rdanieg. The phaonmneal pweor of the hmuan mnid, aoccdrnig to a rscheearch at Cmabrdgde Uinervtisy, it dseno”t mtaetr in waht oerdr the ltteres in a wrod are, the olny iproamtnt tihng is taht the frsit and lsat ltteer be in the rghit pclae. The rset can be a taotl mses and you can sitll raed it whotuit a pboerlm.

Think about the implications of what you just experienced. If your brain did that with letters on a page, what other information is it making up?

Most of the time this process is very useful as in the example above. We are unique in this regard. Our brains are simply amazing, but we must always remember that what we see is not necessarily what is. Simply ask any police detective about eyewitness reports. He or she will tell you that only by looking at similarities across multiple eyewitnesses can the actual events begin to be determined.

Second, biases from experiences and education impact our perception. From the moment we are born, we are developing biases. They allow us to apply our experience for survival. Again, in most cases this is a healthy thing. However, it can also cause us to be irrational. For example, a person who had an overbearing teacher might have a bias against all educators. Similarly a traumatic experience that happened to a loved one or us can impact our perception of situations or people who remind of the traumatic experience. This is something we all do. It is the way we are wired.

Here are four implications for leadership.

A diverse, cohesive leadership team is important. Your core management team should be made up of people from diverse backgrounds and experiences connected by a bond of trust. Multiple perspectives and interests help create a more complete picture of reality. The trust is necessary to allow the team to bring those perspectives together in debate without harming the ability of the team to work together. The trust will not be automatic. It has to be built and maintained intentionally.

Challenge your assumptions. Past successes can cause us to make foolish mistakes. For more on this one, read my last post titled The Delusion of Competence.

Consider all perspectives and data. When making decisions, gather enough information from various perspectives until the proper course of action is clear. To avoid group-think or dominant contributors overshadowing others, consider the following technique. Ask your question, but tell responders to write their answers down without discussing them with one another. Then those answers are read aloud, posted, and duplicates eliminated. If needed, participants can ask for clarification of a response. Then the group is asked to write a ranking of the choices from 1 to however many options were available. The group facilitator then tallies those rankings. This process is called Nominal Group Technique (NGT) and is just one way to make sure everyone’s input is considered.

Have a defined, objective decision-making processes. There are many good decision making process, and one process will not work on all types of decisions. Therefore, it is important to have managers trained in the various techniques and when to apply them. Far too often managers make a decision, and then set about gathering evidence to support their position.

While it is impossible for us to be 100% rational, there are things we can do to hedge against our irrational tendencies. Being disciplined enough to have these four areas covered will improve the quality of the decisions made in your organization. By making better decisions, you’ll find you improve the culture and overall financial performance of the organization too, and that’s very rational.

The Delusion of Competence

Delusion of Competence
If you have achieved almost any level of success, it’s very easy to get caught up in all the praise and exaltation. This can create what I call the Delusion of Competence. This is our tendency to Continue reading The Delusion of Competence

Expectations

A group of us recently had a discussion about expectations. There can be many ways to look at expectation. Continue reading Expectations

Succession Planning – The Risk Isn’t Just at the Top

When most people think of succession planning, they usually think about what to do when a founder or other key executive moves on. However, all businesses have risk beyond just their senior personnel making an exit. What about

Continue reading Succession Planning – The Risk Isn’t Just at the Top

Corporate Succession Planning – The Risk Isn’t Just at the Top

When most people think of succession planning, they usually think about what to do when a founder or other key executive moves on. However, all businesses have risk beyond just their senior personnel making an exit. What about

Continue reading Corporate Succession Planning – The Risk Isn’t Just at the Top

Cirrus-ism for the Day

Naive Enlightenment – When you have just enough experience or data to be too dangerous for your own good.  This exists in a place between ignorance and wisdom.

Is your organization a hypocrite?

“You cannot consistently perform in a manner which is inconsistent with the way you see yourself.” – Zig Zigglar

Not only is this true for individuals, but it is also true of organizations. This is why so many initiatives or programs implemented by management fail. Oh sure, maybe there is a bump in customer service scores, sales, cooperation, or some other metric in the short term, but the success is usually short lived. Why? Continue reading Is your organization a hypocrite?