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Day 12/05/2015

Filtered Reality & Happiness As A 2×2 – “If we believe we can learn from experience, can we also learn that we can’t?” …*

{ Filtered Reality & Happiness As A 2x2 } “If we believe we can learn from experience, can we also learn that we can’t?” ...* | rethinked.org

Screen Shot from Soyer & Hogarth’s article on HBR: Fooled By Experience

In a fascinating article titled Fooled by Experience, Emre Soyer and Robin M. Hogarth, whose research focuses on the psychology of judgment and decision making, highlight the perils of using past experience to guide future decision making without first critically examining the various lenses and biases from which we filter and learn from our experiences.

The problem is that we view the past through numerous filters that distort our perceptions. As a result, our interpretations of experience are biased, and the judgments and decisions we base on those interpretations can be misguided. Even so, we persist in believing that we have gleaned the correct insights from our own experience and from the accounts of other people.

In their article, Soyer and Hogarth examine three of the main filters that many of us use to frame and learn from our experiences — the business environment, the people around us, and ourselves. I was particularly interested in the points they raise about our bias for outcomes rather than processes in the business world.

{ CAPTURING PROCESS NOT JUST OUTCOMES }

In the business environment, the outcomes of decisions are highly visible, readily available for us to observe and judge. But the details of the decision process, which we can control far more than the result, typically don’t catch our attention. If the aim is to learn from experience—mistakes as well as successes—acknowledging that process is crucial.

We celebrate successes and condemn failures–a response that disregards the underlying causes.

The tendency to overreward the results of a decision and underreward its quality is known as the outcome bias.

This bias can influence our actions in subtle ways. A good outcome can lead us to stick with a questionable strategy, and a bad outcome can cause us to change or discard a strategy that may still be worthwhile. For example, in the NBA, coaches “are more likely to revise their strategy after a loss than a win—even for narrow losses, which are uninformative about team effectiveness,” a recent Management Science article shows.

[…]

By concealing the prevalence of failures, the environment makes it more difficult for us to learn from them. Instead, we are fooled into thinking that we have more control over success than we actually do.

Source: Fooled by Experience

This inequality between capturing outcomes versus capturing the decision making process is something that our team has been actively thinking about in our last few workshops. In fact, my explicit purpose in our last workshop was to capture the meta elements of what we were thinking about and considering as we were producing our prototypes. This desire to capture the more ephemeral aspects of the decision making process are linked to Daniel Kahneman’s acronym: WYSIATI – What you see is all there is. We are hardwired to respond to what we can see and tend to ignore the aspects of a situation that fall outside the filters for salience with which we approach that experience. Yet, as Soyer and Hogarth observe, the tendency to overreward the results of a decision and underreward its quality leads to failed opportunities for learning and improved future decision making. 

Head over to Harvard Business Review to read the rest of Soyer and Hogarth’s article and learn the techniques they recommend to help you uncover the real lessons experience offers.

{ HAPPINESS IS A 2×2 – THINK ABOUT ALL THE THINGS THAT YOU DON’T WANT & THAT YOU DON’T HAVE} 

Experience is very important, but not necessarily the experience that you have, but maybe sometimes the experience that you don’t have might matter a lot. Experience in general we know it’s very important, it’s how we understand what’s going on around us, it’s how we form our habits, it’s how we decide and make judgements. And sometimes the environment where we make decisions, where we operate is kind to us–it gives us all the information, all the feedback that we need abundantly, immediately. But sometimes, it’s wicked. The environment, when it’s wicked, it hides stuff from us, it filters out certain part of the information that is crucial for an accurate judgment and accurate decision making. And in those cases our experiences get biased, and this whole thing has adverse effects to our health, wealth and happiness. – Emre Soyer

After doing a quick Google search for Emre Soyer, I discovered the TEDxtalk he gave in 2013 in which he explores the importance of being attentive to the missing elements of our experiences. I was particularly struck by his ending observation, by way of a 1986 interview with Hillel Einhorn, which highlights the power and impact that shifting and questioning the filters we apply to our thinking can have on our happiness.

Now there are some interesting issues there about looking for evidence opposed or evidence about non-occurrences and this was brought home to me dramatically in a Chinese restaurant one night. After the meal, I bought the usual fortune cookies and I opened the cookie and read my fortune, it was a very interesting one. It said: don’t think about all of the things that you want that you don’t have, think of all the things that you don’t want that you don’t have. Well that kind of stopped me dead. I don’t know who writes these things but this is a very interesting one. So, I immediately draw a 2×2 table: want, not want, have, not have. And of course we think about what we want that we have, what we want that we don’t have; what we don’t want that we have; but rarely do we ever think about what we don’t want and what we don’t have. So, I’d like to use this example to point out that if the correlation between wants and haves is some notion of happiness, and because that don’t want and don’t have cell is so large, we are actually a lot more happier than we think we are.

-Hillel Einhorn, 1986

{ Filtered Reality & Happiness As A 2x2 } “If we believe we can learn from experience, can we also learn that we can’t?” ...* | rethinked.org

Happiness is a 2×2 – Screen Shot from Emre Soyer’s TEDxTalk at TEDxOZU

 

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