How To Avoid Confirmation Bias in Business
Delay decisions, ask extra questions, and seek external feedback
When it goes well, starting or running your own business can lead to a feeling of great satisfaction. But, when it doesn’t go well, it can be like living in a horror-filled nightmare.
You could be a sole founder, running a one-man business working for yourself. There are many of those businesses trading today. Working for yourself offers many freedoms; it is a great attraction to being your own boss. But with freedom comes the responsibility of making decisions.
Making decisions means having to deal with your greatest internal enemy, confirmation bias. The biggest problem of all is that you can’t see it. It has to power to blindside you, without you even being aware of it. It is, in every sense of the word, a curse. But there are ways to remove this curse, which I will explore later. Before we can remove the curse, we need to know what it is we’re up against.
What Is Confirmation Bias?
All decisions start with a choice—option a or option b, to turn left or right, or to say yes or no. But which one is the right one? How do we decide?
First of all, our brains use our experiences to favour choosing one over the other. So we already have a bias to which path we’re going to take, and our brains respond accordingly. The brain then seeks an external source, which reinforces the initial preference. Having found a supportive source, we stop looking for contrarian information.
Shane Parish wrote about this in his Farnam Street Blog; the article is a great read. Here is an excerpt that explains confirmation bias in more detail.
Confirmation bias is one of the less-helpful heuristics, which exists as a result. The information that we interpret is influenced by existing beliefs, meaning we are more likely to recall it. As a consequence, we tend to see more evidence that enforces our worldview. Confirmatory data is taken seriously, while disconfirming data is treated with scepticism. Our general assimilation of information is subject to deep bias.
This bias is a powerful one. The act of stopping to look for other data is the problem of not being open to an alternative view. It is a human weakness and one that can be damaging to a business as well.
Confirmation Bias in Business
Confirmation bias is there to trip you up every step of the way. It is our default setting, a mental model that we have to try to overcome.
In business the challenge becomes even tougher if you’re a sole founder, working alone. All the decisions are on you. It’s more than fair to say that confirmation bias as already caused problems for you. It has for me, hence the curse references throughout.
When I look back at the decisions I’ve made, it frightens me how confirmation bias has managed to blindside me. This article is a great example. I picked the subject because a reader had highlighted a line in a previous article. The line referenced the challenge of working on your own.
That will do, I thought. I liked the topic, and the fact the someone had highlighted it was good enough for me. I had my confirmation.
I didn’t bother to consider the 1,700 other readers who hadn’t highlighted the line. Nope, someone else agreed with that this topic was relevant, and here is the article.
It is scary how easily it happens. So how can you prevent confirmation bias from cursing your decisions?
3 Steps to Overcoming Confirmation Bias
In business, there is no tougher job than being the boss. The responsibility for success or failure rests with you. And if that wasn’t tough enough, you have the beast of confirmation bias to battle against. So, how do you do it? How do you overcome a mental model which is intuitive to us all?
Step 1 . Don’t make instant decisions
We are most exposed to the fallacy of confirmation bias when we make decisions in haste. As the soaking I got last week will testify, more time provides the capacity to look for more data.
My wife and I had to pop out to the shops; a quick look at the sky showed a cloudy sky, so we went without a coat. It won’t rain, we said. Ten minutes later it rained, and we got wet. An instant decision led to our downfall; with time we would have checked the forecast on our phone. Armed with knowledge rain was forecast, we would have taken a coat at least, or waited until the shower had passed.
Spontaneous decisions offer a quick path to the danger of confirmation bias. Give the decision time. It is a sure way to open up thoughts to consider different views or sources of data.
Step 2. Change the question
Having given yourself more time to make a decision, you need to use that time wisely. There are two ways to do this. The first is to look for data that doesn’t confirm your initial view. Instead of trying to confirm it, you un-confirm it.
The other way to address this is to change the question. Think of a way you might change the focus of the question.
Think about the soaking I got earlier. I was looking to confirm it wasn’t going to rain. The easiest confirmation was to look at the sky. But what if I changed the question slightly. What if I asked, “Is it going to rain within the next 30 minutes?” Then the context changes, and so does the confirmation needed to support it.
Step 3. Seek external feedback
There is a sense of isolation when you’re the boss, alone and exposed when it comes to making decisions. Looking for other opinions can help. The starting point is often your employees, but there is a danger. If you look for an opinion by asking “I’m thinking we should do…” then you’re more likely than not to get a confirmation. Why would an employee disagree with the boss?
Instead, frame your idea differently. “What do you think about…?” The question isn’t loaded and allows an open response.
Another source might be your customers. Of course, this can only work if your decision relates to a product or service. But customers can often give unbiased feedback.
A mentor is a great resource, particularly for helping with business-related decisions. The nature of consulting with a mentor means any potential decision takes time, which is good. A mentor gives you the space to explain and give air to your thoughts on the decision.
This type of conversation often draws out a more balanced debate, as the pros and cons are discussed. This can help overcome the curse of confirmation bias.
Having a mentor is a great way to overcome the disadvantage of not having a business partner. Collaboration isn’t immune to confirmation bias, but a mentor can help.
Confirmation bias is a curse and a danger to decision making. The risk of making decisions in haste can cause all sorts of problems. Thus, it’s crucial you take steps to prevent confirmation bias.
The three steps I have explained offer a way to achieve this. They are as follows:
- Don’t make instant decisions.
- Change the question.
- Seek external feedback.
It seems logical to add time to making decisions, slowing things down. Time offers a perspective that brings with it the capacity to bring other steps into play.
Changing the question is a clever dynamic that shifts the view at hand. Doing this creates the space to see the decision in a different light and with it the data to support it. Of course, adding external feedback brings yet another viewpoint.
Whether it be your team, customers, or your business mentor, alternative opinions appear. This is a great way to overcome the curse of confirmation bias.
Each of these steps can offer a great way to defeat the curse of confirmation bias. It is my view that they are essential in business, even more so when the business is small or even a one-man operation.
What steps would you take to avoid confirmation bias?