In this final column, we shall close the series on behavioral traits and decision-making errors in the innovation process. The previous parts gave insight into how a connection to our ideas and projects could cause a reluctance to let them go, even if they were failing. Furthermore, they presented how prejudices could lead us to have a biased perception of the information and work delivered to us by our peers and subordinates. Here, the focus will lie on the perils of success-focused thinking.
Locked into success
Of course, we conduct our innovation projects with the goal of success in mind. Whether we set out to exploit a market niche, create an advantage or simply draw even with a competitor, we commit ourselves and resources to it because we seek to succeed with the projects and drive our businesses toward that goal.
This seemingly provides us with clear guidelines on how to make project decisions: If a project offers to be a success, we commit to it and drive it forward. If not, we let it go and focus on more promising prospects.
We all know that it is more complicated than that. There is a multitude of aspects to factor in – market projections, technical issues, financing, legal requirements. Every one of these factors has a unique string of sub-factors, all of which are clouded by different amounts of uncertainty, variables as the project progresses: while early market projections may have little to no value, close to a product’s introduction we will have a good idea of how it will perform.
This complexity, fueled by the ubiquitous uncertainties, takes its toll on our decision-making. Unable to account for and compute all the different layers, we tend to step back and focus on what we believe is the most basic question: Will the project succeed? However, with this approach, we will fail to objectively address the information we are provided with to help us make a decision.
With our mindset primed to ‘project success,’ we will focus on information and arguments that feed this idea. This common fallacy is known as the “confirmation bias.” When we already have an opinion on a subject, we tend to be more receptive to and will search for information in support of this opinion.
We will even actively ignore and dismiss opposing information and arguments. These are met with higher standards, we will question them more and even actively search for arguments to undermine this opposition. It provides us with discomfort and disrupts our beliefs, which in situations of high uncertainty can be especially fragile.
Seeking and accepting information that speaks to what we believe, on the other hand, feels soothing and empowering. They seemingly strengthen these beliefs and opinions. However, following this path of comfort we face the danger of ignoring reality. We may end up in a bubble, which is set to burst once we complete our project and realize its shortcomings.
This confirmatory search can take different forms and affect our behavior in different ways. Thus, if we wish to counter this and approach our decisions more rationally, we must take precautions:
Wilfully challenge your beliefs and accept the inner struggle this challenge entails. Embrace opposing opinions and ask yourself why it may be right, not why it is wrong. Hold supportive information as accountable as you would any counterargument. Do not just accept it but question its source, its validity, and applicability to the situation.
This column concludes my four-part series on decision fallacies in the innovation process. While this short series could only give a brief introduction into what I have learned and observed, I hope it was able to awaken the interest and, more importantly, the awareness of decision-making errors we all face in the process of innovating. In this sense, I wish you all a successful and more rational 2018.
Ryan Kraft is an expert in the field of innovation management and behavioral decision sciences. He is currently a consultant for MoneyMax.ph, the Philippines’ leading financial comparison website. Tweet us: @MoneyMaxPH, like us on Facebook: MoneyMax.ph, and email your comments to email@example.com. For more information, visit our website: www.MoneyMax.ph