Expose Cognitive Biases For What They AreHow to avoid flawed reasoning and make better decisions.
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Researchers estimate that humans make an average of35,000 decisionsevery day, and a good chunk of them are affected by cognitive biases. According to onestudy, 20 percent of healthcare providers' diagnostic mistakes are caused by cognitive biases. And that's afteryearsof training. With a universe of competing interests vying for first place in our lives, we often feel pressured to act quickly. The problem is there is often a chasm between the information we have and the information we need to make good decisions. Thus, we take mental shortcuts.
Cognitive biasesare systematic judgment errors. They are born of flawed reasoning, and that flawed reasoning can cause you to misinterpret information and draw false or inaccurate conclusions. Not surprisingly, we all have them. Our penchant for self-delusion is pretty consistent.
The good news is that becoming aware of your cognitive biases can help you make better decisions. According to a recentstudy, "debiasing training" can improve your ability to make rational decisions and avoid the errors commonly associated with faulty thinking.
Below are some of the most common examples. Consider the pitfalls of each as you strike out to make better decisions.
Related:7 Ways to Remove Biases From Your Decision-Making Process
Anchoring bias
Salespeople exploit our susceptibility to anchoring biases, wherein we use an initial piece of information as the yardstick for measuring other information. After seeing the sticker price on a new car (i.e., the initial information), you might feel like you've beaten the bank if you negotiate the price down 15 percent. But in reality, the dealership still comes out ahead. You only think you got a deal because you're comparing your final price to the initial price.
Performing relevant research and analysis are key for combating anchoring bias. If you walk into a dealership knowing average out-the-door prices in your area, that sticker price is less likely to sway you.
Related:The Psychological Trigger That's Confusing Your Customers
Availability heuristic
The availability heuristic is the reason some people deny climate change. Memories of the 50-foot snow blizzard that buried your city last year are easier to recall than those of gradually rising temperatures over decades. Too often we make decisions based on easy-to-recall facts that require little mental exertion.
To avoid the availability heuristic, acknowledge that your memory may not always serve you best. Then, arm yourself with credible information. Before shooting down the collective knowledge of the scientific community, consider researching and evaluating their claims for validity.
Confirmation bias
In a world of hyper-fractured media, it's easy to fall into the confirmation bias trap. By only embracing sources that support your views, you are working against your own best interests.
Cherry-picking facts does not make them true. More than that, it often leads to skewed thinking and poor decision-making. Instead, squelch confirmation bias by examining information from multiple sources, including those offering facts that counter your beliefs.
Related:Don't Let Confirmation Bias Derail Your Startup Plans
Fundamental attribution error
When we commit a fundamental attribution error, we overemphasize character as the reason for anomalies in an individual's behavior, while minimizing the role of situational dynamics. The cashier making mistakes at the register might not be a careless person; she may have just learned her mother passed and is unable to fully concentrate on her work.
To avoid fundamental attribution errors, resist the urge to levy blame and instead look for the cause. Assume a person's undesirable behavior is caused by tough luck or some other factor, rather than a reflection of poor character.
Halo effect
The halo effect tricks us into believing that if one part is exceptional, then the whole must be, too. Companies spend oodles on advertising because they know consumers are prone to the halo effect. An excellent ad campaign often translates into increased sales across the board (not just for the featured sale items), even for average products. I'm looking at you, McDonald's.
To avoid the halo effect, acknowledge that people — and organizations — are complex, and unfortunately being good at one thing doesn't always translate into competency across the board.
Related:3 Ways Your Brain Can Trick You Into Making Bad Decisions
Ostrich effect
Ostriches don't actually bury their heads in the sand to avoid unpleasantness, but we humans have a knack for avoiding mental discomfort by ignoring facts that contradict our beliefs. If you continue to invest in the stock market although you consistently lose money, you might be suffering from the ostrich effect.
To avoid it, pay just as much attention to costs as to benefits. Toe the line between faith and skepticism by being optimistic and acknowledging hard truths, rather than simply pretending they don't exist.
Framing effect
Spin doctors are masters of exploiting the framing effect. They know public opinion can be swayed by the way they present information. Rather than admitting over-the-month unemployment increased 10 percent, they might say it decreased 3 percent during the year.
If you're prone to changing your opinions based on the way facts are framed, consider seeking points of comparison that shine the light on them differently. Illumination can make half-truths wither.
By realizing the various ways in which your thinking can go astray, you can self-correct cognitive biases. It takes practice to make good decisions, but the rewards of rational choice are incalculable. By changing your mind, you can change the world around you, one good decision at a time.
