Overconfidence: How Your Mind is Rigged Against You

You know when you go to a carnival and you see one of the games and you’re like “I could do that! I could knock over those milk bottles. I played baseball in high school.”

And you conveniently ignore the people that go before you and fail at that task. You see that no one’s walking away with a big teddy bear up on the top shelf.

And yet, you still believe that you’ve got a better-than-average chance of knocking them all down.

That example of overconfidence in a rigged situation is what I’m going to use as a visual metaphor as I describe a handful of ways in which your mind is rigged against you, how it makes you overly confident in certain situations.

The ideas that I’ll be sharing here come from the book Thinking, Fast and Slow by Daniel Kahneman.

I will share four examples of how overconfidence can crop up in your life (without you being aware of it) and one technique that you can employ to help combat that.

The Illusion of Understanding

One source of our overconfidence in future events stems from how we think about the past.

What Kahneman calls the illusion of understanding comes when you spend time in Monday Morning Quarterback mode, looking back at a past situation and explaining with complete confidence why things happen the way they did.

You emphasize the things that you knew were going to happen all along as you create a nice tidy story in your brain about what happened and why. You craft for yourself a good story that simplifies the events into a cohesive narrative.

But in that oversimplification we tend to do away with nuance and complexity and we ignore the role of luck, because those complicate our tidy view of the world.

It’s that oversimplification of the past that contributes to us thinking we know how the world works and we can make good predictions about what might happen next.

The Illusion of Validity

Confidence in our predictions of the future is very often unwarranted, and this is where the illusion of validity comes in.

Here Kahneman gives an example of evaluating potential future leaders based on a 2-hour group exercise, where a challenge is placed to the group. In this case the challenge is physical – moving a big log over a wall without the log or any of the participants touching the wall.

The folks who observe that activity rate each individual on their future potential as a leader. Scores comes to mind easily because you get to see who steps up in a challenging situation, who backs down when their idea isn’t taken on by the rest of the group, and who just does what they’re told but doesn’t come up with any ideas of their own.

Despite the confidence that you might have as that observer in determining who’s going to go far and who won’t cut it, follow-up has shown that those ratings that you give based on that 2-hour observation don’t actually correlate to long-term performance.

The scores aren’t indicative of what that individual is actually capable of, because you can’t extrapolate long-term potential by evaluating one particular performance that had a specific set of circumstances surrounding it.

But because of the way that our brain likes to create tidy coherent stories for us, including stories about others that are heavily influenced by our first impressions, those ratings continue to happen and our confidence in them doesn’t wane, even when we hear that those ratings don’t correlate with future performance.

Intuition vs. Algorithms

Even when we’ve got compelling data in front of us, we still like to trust our gut. We think that our intuition is better than those numbers, that data, or any particular algorithm.

An example that came up here was counselors predicting student success based on things like an essay, maybe a hour-long conversation, and perhaps some test scores. Another example is through the hiring process, and how much credence is given to the impressions gleaned from a 45-minute conversation compared to looking back at the past performance of that individual.

Trusting your gut might prompt you to think “My feeling is better than your formula”, but in many cases you’d be wrong.

That’s not to suggest that you should neglect the role that feelings play in processing the world. As we learned from the book The Extended Mind, paying attention to your body can provide a rich source of information.

But in this case, when it comes to any form of evaluation, whether it be a doctor seeing a patient, a counselor working with a student, on an employer hiring some someone new – those situations allow for a huge amount of bias to enter into the decision-making process.

That bias can be circumvented by identifying a handful of more objective measurements that actually do have a correlation to future performance, future risk, and future need.

Kahneman acknowledges that intuition can still play a role, it can be one of the factors worth considering in the evaluation process, but the intuition of a single person or a panel shouldn’t be weighted too heavily compared to other indicators that are more objective.

As humans it can be hard for us to get behind a reliance on formulas, but once you acknowledge that relying on intuitive judgments (and the biases that come with them) can be inherently unethical, I think that opens the door for letting some other metrics into the picture.

The Inside View

In certain situations we also tend to focus a little bit too much on our specific situation, without widening our view and paying attention to others who have gone through something similar.

As an example of this inside view, Kahneman described a collaborative effort that he and some colleagues went through when developing a textbook. And at one point in the process each one estimated how much longer they thought it would take for them to complete this textbook. The average came out to about two more years.

But when one of those colleagues (who had experience with textbook-writing) was asked about other groups who had written textbooks, he conceded that on average groups at that stage took about another 7 to 10 years to complete a textbook.

Even when presented with that type of information, when you hear about how long it takes someone else to complete a particular task, your mind tricks you into believing that you are distinctly different than that average, that you can do it in 2 years when others did it in 7.

We like that story better. We prefer that inside view, when in reality taking on an outside view, looking at how others have completed a similar task and how long it took them – that can be a lot more helpful in the planning process.

The Pre-Mortem

You’ve now seen four ways in which overconfidence can creep its way into your life and work and predictions about the future and how you approach your planning.

But it’s not all bad news.

There was one specific technique that was found to be helpful in combating that default to overconfidence that our mind takes, and that technique is a pre-mortem.

When conducting a pre-mortem you take some time at the early stages of a project to think about all the things that could go wrong, because often our overconfidence comes from an assumption that everything’s going to go smoothly, nothing’s going to interrupt our plans, things will work exactly how we laid them out.

But of course that rarely (if ever) happens, so going through a pre-mortem process and identifying what could go wrong, how you might respond to it, what those setbacks might mean in terms of timeline and effort required – that’s how you can achieve a more realistic picture of how a particular project might unfold, so that you can better allocate resources toward that project and also just have more realistic expectations.

Unacknowledged and undeservedly high expectations can derail a project as quick as any other setback you might face.

Make Visual Artifacts

If you enjoyed the ideas above, do go pick up the book Thinking, Fast and Slow, where you’ll find lots more about how the brain works.

And if you liked the way that I sketched out those ideas, that’s a skill that you too can develop!

Check out our library of courses where you can learn how to create visual artifacts to better remember, work with, and share interesting ideas.

Happy learning and sketching.