In November 2013 I saw the headline Five cognitive distortions of people who get stuff done, and thought “wow – all the cognitive biases I know get in the way of rational thought and are unhelpful”. My surprise at finding that irrational thought could be useful prompted this post at the time.
Since then I’ve been on a (slow) journey to understand the interplay between intuition and rational thought, particularly helped by Daniel Kahneman’s Thinking Fast and Slow and Richard Haidt’s The Righteous Mind. I wrote a number of other blog posts too, most notably Thinking fast and slow at a VC fund, Debating with intuition as well as logic, and How our rational brains justify our intuitive decisions.
The more recent posts are mostly about recognising the role intuition plays in our decision making and how to counter it when appropriate. My understanding of the importance of intuitive thinking was limited to the fact that it helps when decisions need to be faster.
Then this morning I read How Our Delusions Keep Us Sane: The Psychology of Our Essential Self-Enhancement Bias on brainpickings. It took me right back to the November 2013 ‘aha moment’ that in the right places and right doses irrational thought makes us happier and more successful. The article opens with the following paragraph:
“Optimism is the faith that leads to achievement; nothing can be done without hope,” Helen Keller wrote in her 1903 treatise on optimism. But a positive outlook, it turns out, isn’t merely an intellectual disposition we don — it’s a deep-seated component of our evolutionary wiring and the product of powerful, necessary delusions our mind is working around-the-clock to maintain. At the root of that mental machinery lies what psychologists have termed the self-enhancement bias — our systematic tendency to forgo rational evaluation of our own merits and abilities in favor of unrealistic attitudes that keep our ego properly inflated as to avoid sinking into the depths of despair [and keep us motivated when times are good].
There are two points of interest here. Firstly we are wired to be irrationally optimistic about our own abilities. Early primates who kept believing when times were hard survived and mated more often than their more pessimistic brethren. Hence being rational is hard. Secondly, being irrationally optimistic is useful – at least sometimes. Puncturing the bubble with rational analysis might result in a loss of motivation with no discernible gain.
When I think about this in the context of business activities it seems to me we need a switch. The vast majority of our opinions and hence decision making should be rational, but allowing a dose of unconscious irrational optimism helps us motivate ourselves and others. It’s how we achieve the seemingly impossible. However, we need the switch when that irrational optimism stops serving us well. When I was at Reuters Venture Capital, for example, we worked like crazy to raise our second fund in the tech nuclear winter of 2001-2003 and kept believing, but there came a point when we flipped the switch and gave up. That was painful, but it was the right thing to do. To keep trying would have been like banging our heads against a brick wall.
The challenging thing for teams is that different people have different levels of optimism, and it gets really hard when one person wants to flip the switch and others want to keep believing. That’s where the leader needs to carry her organisation (and make sure her switch is in the right place). The example I gave above was literally life and death for us, but the same dynamic plays out all the time at much smaller levels. In VC firms it often relates to whether investments will get made, in startups it often relates to whether partnerships will deliver, sales will be made, and key metrics will move. Establishing clear parameters in advance that will lead to the switch being flipped takes discipline, but is one useful trick.
If you have a few minutes I heartily recommend you read the full brainpickings article.