Invisible Laws

You’re cruising along at 39,000 feet listening to your favorite iTunes playlist. It’s been a long week and you’re feeling relaxed, knowing you’ll soon be home. Suddenly, the plane is shaken by turbulence, first rocking side to side and then dropping briefly like an elevator. Your instinctive reaction is one of fear; the plane seems out of control, about to drop from the sky. You think back to the article you read on turbulence just last week. It said that the conclusion of pilots and aviation safety experts was unanimous; statistical danger to passengers from turbulence was next to zero (as long as your seat belt is securely fastened!). You double check your seat belt but still can’t shake that feeling that you are in danger and an ominous event is ahead.

Why is it that human beings are so tuned to rely on personal sensory data and observation to establish facts, assess risks and make decisions? Why does this personal observation often trump scientific evidence as well as data collected by sensitive machines? How does this propensity hold people back from being more effective decision makers?

The answer, in part lies in our evolutionary history. For most of our existence as a species we lived in a natural world where our senses provided the best means for survival. Second guessing these senses was usually a poor strategy. Is that a tiger lurking in the grass? Probably better to err on the side of “yes”. Walking down this steep hillside is making me feel unsteady. Am I in danger of falling and hurting myself? Probably better to abandon my journey now.

But these same skills that served us well in a prehistoric environment created significant limitations for advancing our state of knowledge and understanding of the complex, natural world around us. Without scientific knowledge and instruments, in addition to his senses, prehistoric and ancient man relied on myth, folklore and superstition to explain a host of natural phenomena. This led to a host of misunderstandings about a wide range of phenomena from fertility to the weather to the yield of plantings.

Much early progress in the advancement of knowledge stemmed from augmenting the basic sensory capabilities of humans. The invention of the telescope in the 17th century extended man’s ability to observe and understand distant objects in the universe. It led to a breakthrough in understanding the motions of celestial bodies and enabled the heliocentric view of our solar system.

While the telescope augmented human vision for distance, the microscope enabled the study of tiny objects. It’s invention led to a broad array of landmark discoveries including cells, microorganisms, the germ theory of disease and genetics. Instrument driven advancements in medicine included x-rays (allowing vision through solid objects) and the stethoscope (enabling hearing for improved clinical observation).

Scientific instruments, along with an accumulated body of scientific knowledge, enabled people to make more accurate and precise judgements about the natural world. But it required humans to put their instinctive “naked” observations to the background and trust instruments as an improved source of “truth”. Is this patient ill? My gut tells me yes, but this x-ray indicates no. Will it rain tonight? Should I plant these crops? The clouds say no, but the Doppler radar says yes.

A large body of human progress has been driven by people putting their instincts on hold, accepting the improved capabilities of scientific instruments and knowledge to guide them. Unfortunately, this is by no means consistent or universal. A great example involves airplanes. A phenomenon can occur where reduced visibility causes a pilot to lose sight of the horizon. Under these conditions, the pilot can become disoriented, incapable of determining whether the plane is banked or flying level. If he relies on his vision or inner ear as a guide, he can mistakenly pilot the plane into a “death spiral”, causing a tragic crash. This is what experts believed happened to JFK Jr. on his fatal flight in 1999.

Artificial Horizon Gauge

Instead of relying on vision and one’s inner ear, experienced pilots are trained to ignore their natural senses and rely on their speedometer, altimeter and artificial horizon gauge. Together these three instruments tell the pilot whether he is flying level or heading directly into land or sea. But the instinct to override these gauges when presented with conflicting feedback from natural senses is overwhelming. And unfortunately, many a pilot has met a similar fate to JFK Jr. due to this tendency.

Just as we can reject the readings of scientific instruments, we tend to be skeptical of scientific findings that are not easily observed. Nobody questions Newton’s findings regarding gravity. While it is not a visible “thing”, it’s effects are readily observable. On the other hand, evolution is not easily visible and is unintuitive. It has taken place over billions of years, a time frame that is not personally observable. Nobody needs to be convinced of the power of heat to burn human skin. One touch of a stove is enough to create lifelong knowledge of the science of thermodynamics for a small child. However, convincing people of the link between sun exposure and skin cancer is a more difficult task. The lack of immediate feedback or observable danger leads to a false sense of security.

Evolution has equipped us with some marvelous senses that allowed us to survive in a hostile primitive environment. Unfortunately, these senses interfere with our ability to function optimally in a complex, modern world. They cause us to overweight minimal risks and underweight serious ones. They lead us to ignore evidence and data that seems to conflict with our instincts or personal observations.

There is no simple answer to this problem. Our hard wiring is strong, built over millions of years to ensure our survival. However, as with all negative tendencies, it all starts with awareness. When evaluating evidence, and feeling skeptical, consider the nature of the underlying data. Is it something tangible and observable, or measured through instrumentation and analysis? Is the analysis based on accepted scientific principles and performed by unbiased parties with no conflict of interest?

Being able to think critically about evidence and being able to check one’s tendency to overweight personal observation can be a big benefit to any professional. It can allow for better assessment of risks, better judgements and improved decision making.

One of the most fundamental tasks we face, personally and professionally, is making a decision. Often, to make our decisions, we attempt to forecast future results, picking the path that leads to the “better” outcome. If we possessed a special algorithm, or had a working “magic 8 ball”, we’d always make the right choice. Unfortunately, as mere mortals, our decision making process is sub-optimal.  We are often surprised to find that a decision that looked sensible at the time, led to a disappointing outcome.

Over the last 40 years, the field of decision science has researched how humans are predisposed to make irrational and counterproductive decisions. A prevailing idea from this research is that evolution has hard wired people to have cognitive biases that underly much of this irrational behavior. Let’s look at three of these biases and see how they undermine our ability to be effective decision makers.

Hyperbolic Discounting is a term used by behavioral economists to describe the natural human tendency to significantly favor immediate as opposed to delayed rewards. In more common parlance, this would be described as impulsivity. We are faced with choices of immediate vs. delayed rewards on a daily basis. Should I have that fabulous piece of cake on the desert tray? It’s going to taste fantastic and provide immediate enjoyment. But it’s going to work against my goal of looking fit at the beach next summer.

A large body of research has demonstrated the hyperbolic discounting phenomenon in a lab setting. In a typical study, subjects are given a pair of choices for monetary rewards and are asked to express a preference. For example, many people will express a preference to receive $100 today as opposed to $200 in a year, despite the fact that this is financially irrational. These same people however, would prefer receiving $200 in six years as opposed to $100 in five years. Notice that the time gap between rewards is the same in both examples; one year. That is, if we zoomed ahead five years in time, we’d face the same decision: Receive an immediate $100, or $200 the next year. But as  hyperbolic discounting describes, the effect of delayed rewards diminishes when viewed further into the future.

Hyperbolic discounting is viewed as a major component of dysfunctional behaviors and poor decisions. It is a driver of poor financial planning, addictive behaviors and procrastination. In any situation where there is an immediate pleasure or reward, we often make that choice, despite severe, negative long-term consequences. In the corporate world, we can see the negative impact of hyperbolic discounting at work. It’s an individual, engaging in busy work, getting a sense of immediate gratification, while making no progress against a critical project that’s due next month. It’s a department, announcing a layoff, looking at the immediate drop in expenses, without weighing the longer term damage to service, morale and culture. It’s the company making an acquisition, with an expectation of immediate growth, without considering the longer term complications of integration.

Another driver of bad decision making is something known as impact bias. Like hyperbolic discounting, impact bias looks at how people forecast the future value of decisions. When people consider a decision, they attempt to predict how this decision will ultimately make them feel. Will buying that new car make me happy? Will I be more satisfied if I switch jobs? Should I break off a dysfunctional relationship? Psychologists have determined that people have a tendency to overweight the expected impact of many decisions. For example, people tend to think that purchases will have a greater positive impact than they actually do.  They also underestimate their personal resiliency, believing that negative events will lead to significant, ongoing suffering.

Researchers have found a number of underlying reasons why people tend to overestimate the future impact of positive and negative events. One prevailing idea looks at the mechanics of how we tend to envision these events. Most people tend to focus on the initial event itself, visualizing the strong emotions that occur immediately. In fact, researchers have a name for this phenomenon, focalism. For example, when considering the new car, people picture the joyful moment of receiving the car at the dealer. They imagine that first ride with friends and family members. When they consider breaking off a relationship, they picture the awful confrontation, fighting and subsequent heartache. In both cases, by focusing on these vivid images, they overestimate the ongoing impact of the situation. In a short period of time, that brand new cherished toy becomes simply the car in your driveway. Negative events, such as failed relationships, also tend to recede to the background. When people focus on the events themselves, they underweight the impact of the vast set of other things going on in their lives.

Another tendency people have when making decisions is to look to the past for guidance. If I’m trying to decide whether to throw a surprise party for a friend, I’ll use past experiences as a point of reference. While this sounds rational, people have a tendency to perform this process in a sub-optimal manner. Specifically, researchers have found that people are likely to recall an atypical, but notable example of the decision.   For example, one is more likely to recall the time that Uncle Jimmy was embarassed by his surprise party, leading to a years long family rift. Alternatively, one might nostalgically recall that amazing surprise party where you met your future spouse. In either case, this single instance is frequently, an outlier, an unrepresenative example, and poor decision guide.

So what can we do to counter our inherent tendencies to use defective strategies that result in ineffective decisions? It all starts with self-awareness. When getting ready to make a significant decision, try to invoke the following strategies:

• When your decision involves a trade-off between immediate and delayed gratification, visualize the future impact of your decision. Remind yourself that large goals are unachievable, without consistent, small sacrifices.
• When visualizing the impact of a future decision, discount the immediate emotional reaction that you picture. Remember that the positive glows fade and negative hangovers recede.  Your life satisfaction will be the result of a much greater set of factors than this decision alone.
• Ensure that you consider a broad range of historical examples. Seek out examples that are beyond your personal set of experiences.
• Seek out the advice of a trusted friend or professional colleague. Ironically, we have a tendency to be able to advise others better than we can ourselves. When giving advice, cognitive biases don’t seem to impact our decision processes.
• If you can’t utilize a trusted friend, or don’t feel comfortable sharing the decision you are making, simulate the same process. Pretend you are advising a friend who has brought this decision to you.  What would you tell the friend as a “neutral”, outside party?