Perhaps in recent months you’ve found yourself in a situation where, once you witnessed or received news of an outcome, you said to yourself, “I knew it! I knew it all along!”
Maybe it was the fourth quarter comeback by your favorite team (or the fourth quarter choke). You may have thought of a movie plot that you figured out early on, before anyone else. Perhaps it was the long awaited test results that make sense of a loved one’s condition. Or maybe it was the moral failure of a colleague or leader you follow. There are many instances in our lives—some that are trivial, others that aren’t—in which we have this overwhelming sense that we could have predicted the outcome (had we been asked in the past). It’s the assumption that “I knew it all along.” Researches call this assumption a ‘hindsight bias’. According to the Association for Psychological Science, this assumption “is one of the most widely studied decision traps and has been documented in various domains, including medical diagnoses, accounting and auditing decisions, athletic competition, and political strategy.”
The problem with the assumption that “I knew it all along” is that, in the vast majority of cases, we didn’t know it all along. We just feel like we did. In our personal lives, living by this assumption can make us look foolish, or cause our friends and colleagues to become irritated by our behavior. However, when this assumption finds its way into our strategic thinking, it can have much more ‘deadly’ results.
Where Does This Assumption Come From?
According to an article in the September issue of Perspectives on Psychological Science, authors Kathleen Vohs of the University of Minnesota and Neal Roese of the Kellogg School of Management at Northwestern University write that the “[h]indsight bias embodies any combination of three aspects: memory distortion, beliefs about events’ objective likelihoods, or subjective beliefs about one’s own prediction abilities.” The authors suggest this bias manifests itself in three different ‘levels’:
- I said it would happen. Misremembering an earlier opinion or judgment about an event or circumstance.
- It had to happen. Believing that the outcome was inevitable.
- I knew it would happen. Believing that we could personally foresee the outcome.
Regardless of the source of this assumption, the more we convince ourselves that ‘we knew it all along’, the greater the negative impact it can have on future decisions.
Why Do We Make This Assumption?
Many factors can fuel our hindsight bias. ‘Selective recollection’ causes us to filter out information that doesn’t fit what we know to be true, leaving us to try and create a narrative that makes sense of the data that’s left. (Remember the first rung of the ‘ladder of inference’?) Once we are able to stitch the pieces together in our minds, we conclude the outcome was predictable (and we knew it all along!). Other research suggests that we have an innate need for closure that motivates us to see the world as neat and orderly, causing us to believe that the outcome was logical and clearly visible as it unfolded.
Perhaps another reason we make this assumption is we just want to be right. It feels good to ‘nail it’, especially when others don’t. Could it be that our desire to be the one who ‘told you so’ skews our perspective a bit?
How Does the Hindsight Bias Wreck Strategy?
There are two key dangers that make this assumption deadly:
- We limit our ability to learn from the past. The more we believe we ‘knew it all along’, the less likely we are to reflect on why things truly happen. When it comes to strategic thinking, we could find ourselves doomed to repeat past failures.
- We begin to place too much confidence in our own perspectives. In doing so, we unknowingly begin to narrow our fields of view, falling victim to Deadly Assumption #2. If we really knew it all along, we would have little need for outside perspectives, right?
How Can We Overcome the Hindsight Bias?
Conquering a deep-seeded hindsight bias can be tough. Here are a few things your team can do to uncover and overcome this deadly assumption:
Do the Opposite! Thinking through how opposing strategies could be successful can help us overcome our tendency to filter out information that doesn’t fit our ‘story’. When you’ve come up with an idea that you feel you ‘knew all along’, choose one or two divergent strategies and think through with your team how you could make them just as, or more, successful.
Uncover Your Assumptions. Perhaps the place to start is by identifying all of your underlying assumptions. This can be done by questioning everything. Asking ‘why’ five times can help your team get to the core of something quickly. Asking each other to discuss the facts or unpack the data that informed a decision can help determined whether or not something is based on assumptions (and what they are). Just taking the time to do a little digging into your own thinking will yield positive results.
Learn Something New. You’ve no doubt heard the saying ‘leaders are learners’. Learning new things or encountering new perspectives and ideas are a great way to break free from assumptions and perhaps realize, “No, I really didn’t know it all along!”
HUB Will Help You Move from Hindsight to Foresight
If you’re looking for an environment and experience that can help you move from hindsight to foresight, join us for our fall launch of HUB. A ‘hub’ is defined as “the effective center of an activity.” Our belief is that HUB will become the effective center of innovation for high impact church leaders. HUB is where you and your team can gather with expert thinkers and experienced practitioners to exchange ideas, gain insights, and accelerate results. At HUB, your assumptions will be exposed, biases challenged, and your walk away with better strategic decisions. If you’re looking to sharpen your focus, clarify your thinking, and accelerate Kingdom impact, HUB is for you. Click the image below to learn more.
This blog is part of a 7-post series. Click to read each of the posts: #1 Anchoring, #2 Framing, #3 Confirmation Bias, #4 Others Understand Things the Way I Do, #5 I Knew it All Along, #6 The Overconfidence Effect, #7 Commitment Escalation.