Bias is defined as “prejudice in favor of or against one thing, person, or group compared with another, usually in a way considered to be unfair.” In the business world, this definition also applies to concepts and ideas.
As business leaders we like to think we’re impartial, open-minded and objective in regards to new ideas, but the human brain doesn’t work that way. Our brain has a strong bias for information that supports our existing view of the world. It actively seeks out data that supports our viewpoint, and often ignores evidence that contradicts it.
Bias is a leading contributor to poor business decisions, especially during the strategic planning process. Which is why I constantly urge business leaders to make it a habit to identify their assumptions, biases, and beliefs and test them against current reality before making any major decisions. Now there’s further evidence supporting the value of this approach.
A survey by McKinsey Consulting asked executives to rate the outcome of a recent strategic decision at their companies as either satisfactory or unsatisfactory, while focusing on the role that various biases may have played. The survey found that satisfactory outcomes are associated with less bias, thanks to “robust debate, an objective assessment of facts, and a realistic assessment of corporate capabilities.”
According to the survey, companies that produced positive outcomes did a better job of forecasting consumer demand and competitor reaction. They did a better job of assessing their own abilities to implement the decision. And they were also more likely to engage in certain activities that minimize bad decision-making. These include:
- Actively seeking out contrary data to ensure that key decision makers had all the information they need to make the best decision
- Allowing people with conflicting points of view to openly express their opinions
- Thoroughly reviewing the business case for the decision, even when senior executives strongly supported the decision
- Establishing processes and lines of communication to ensure that truly innovative ideas reach the senior management level
These kinds of behaviors seem counterintuitive. Partly because they contradict the unspoken biases and assumptions that tell us we already know what we need to know. And partly because they lengthen the planning process.
It takes time to gather and analyze information, especially data that we don’t want to see or hear. It takes time to listen to everyone’s point of view, especially those that would seem to be nay-sayers. And when senior managers are chomping at the bit to make the decision and move on, it takes time (and courage) to stand up and say, “I think we need to look at this some more or in a new way.”
In today’s world, we’re all running so fast that pausing to engage in these kinds of processes feels like we’re falling behind. But if we don’t take the time to evaluate how we gather information and how we reach conclusions based on that information, we end up making decisions that can have disastrous consequences. And this is the process I call “slowing down in order to go fast.”
Slowing down to go fast starts with actively seeking out information from a variety of sources. Pay attention to trends and events outside your industry. Then look for ways to apply that information to improve internal systems and processes or to add value to customers in new and better ways.
In meetings, don’t just tolerate opposing points of view, actively encourage them! Tell people, “This is the way I see it. Now I want to hear from those who see it differently.” Make it safe for people to express their opinions, even when they contradict the prevailing point of view.
The stronger you feel about an issue, the more likely it is that unspoken assumptions are driving your position. Expose your thinking on the issue and have people push back.
How did you reach that conclusion? What about the data leads you to believe that? Have you looked at it from this angle? Even when everyone seems to be in agreement, pause and ask, “Are we missing something here? Is there another answer to this problem? Is there a better answer or set of answers we should consider?”
The next time you undertake the strategic planning process, slow down in order to go fast. And remember to check your biases at the door or at least expose them to everyone!