As part of my MBA program at Texas Tech (Wreck ‘em), I am taking a Business Analytics course. Recently, we did an exercise in class where we had to rank how certain we were about answers to random trivia questions (80% sure the answer is A, etc.). It looked like this…
Answer: A or B
Confidence in your answer: 50-100%
(Obviously, if it is less than 50% you would choose the other answer.)
After we completed the questionnaire, the instructor called out the correct answers and we tallied the results to show which we answered correctly/incorrectly and how accurate we were when we guessed our confidence level in our answer. Some of you may already realize this… but we were ALL over-confident. Everyone in the entire room, law school graduates, CPA’s, CEO’s, future CEO’s, and one Managing Director of Development and Collaboration were all more positive that we knew the correct answer than we really did. (I think my statistic was something like when I say I am 70% sure, I am only correct 30% of the time. Scary right??)
Fortunately, for this defeated group of students, this was exactly the point the instructor was trying to prove. We rely on gut instinct and intuition, and we are wrong… A LOT. Then, once the facts do show that we are indeed incorrect, we actually rationalize our error (typically using extenuating circumstances beyond our control). We say things like, “that would have been successful, but we ended up having to switch gears to focus on something else” or “it really was a great idea, but the customer base ended up needing something else…” or “nobody could have predicted that downturn in the economy.” Next, we repeat this situation, time and time again.
So, how do we overcome this over-confidence? Well, the answer is really not that black and white. We can make use of metrics, data, and algorithms, but we have to be careful. As Mark Twain once said, there are “lies, damned lies, and statistics” but, numbers can be powerful and algorithms are more accurate than our gut feeling (seriously, it is true, read this). When you track data over a period of time, find trends, form algorithms and analyze, you are able to look at results in a more unemotional state that lets you make truly informed decisions without your own preconceived notions, desires and bias weighing in. This type of decision-making can also lead to greater efficiency organization wide, because instead of multiple people using debate and brainstorming (or worse, group think), you can implement tools and processes for making quick and accurate decisions.
That said the POWER of over-confidence is actually very beneficial to an organization. Yes, you heard that correctly! When looking back over the course of history, we see inventions and innovations like the first car, first flight, and medical advancements. It is clear that without some creative humans setting lofty goals, brainstorming, and trying again, and again, and again (despite the overwhelming statistics showing they would fail), we would not have progressed as a society like we have. Innovation is the key when starting new initiatives and staying on the leading edge (being in the 16%). Especially in local government, it would be detrimental to eliminate or even stifle the creativity that over-confidence brings to the organization. Sometimes success is not about what would be supported through numbers and data, because only a human can make a JUDGMENT call.
All of this is to say, while we all think we are more correct than we really are, it is important to acknowledge and understand and use it to our advantage. Leaders in local government face an even more unique challenge, because while most are driven to serve the public and create a learning organization, they are also focused on streamlining operations and overall efficiency. As leaders, we must find the right balance to utilize the over-confidence to spur innovation, while being aware of the impact over-confidence has on accurate decision-making.
My boss, Ron Holifield, often says, “I would rather try ten things and only succeed at five than to try three things and succeed 100% of the time.” This is a truly innovative approach and has allowed the entire company to take risks and think outside the box.
So, what are you doing in your organization to overcome over-confidence? Are you using it to spur innovation?
Managing Director of Development and Collaboration
Here’s part of what we know about innovation so far.
I read a lot of books that deal with innovation challenges. They dominate the best sellers lists. The warnings are everywhere—the next breakthrough innovations are around the corner and if you are left behind, then you will really be left behind!
I think we can say that these insights are the current minimum insights regarding “received wisdom” about innovation (they come from a number of the books I have read, and presented, at the First Friday Book Synopsis).
Here are four “lessons” about innovation.
- Everything can be improved. Every product. Every process. Work on constant improvement.
- Innovations come by building on, tweaking, and adapting yesterday’s innovations. Thus, all innovators build on the shoulders of prior innovators.
- Most innovations come from teams. It is people working together, more than one person working alone, that leads to breakthroughs. (From Walter Isaacson’s The Innovators: “Most of the innovations of the digital age were done collaboratively”).
- A breakthrough innovation is not valuable until it is put to use in some practical way(s) to benefit many.
I suspect that you could expand on this list…
But, this much I know: Whatever your endeavor, you need to be working on innovating constantly. And, innovation needs to be pretty much woven throughout the very DNA of your organization. Innovation is a crucial part of the everyday job of the many.
Professional Speaker & Writer
Co-founder, First Friday Book Synopsis