Cognitve biases and project management

Cogni&ve Bias and Project Management

06/06/2014 1

http://www.taesch.com/cognitive/cognitive-bias-project-management/2014/06/04/595 http://goo.gl/M7IM3O

What is this, a bias ?

•  “Insanity in individuals is something rare

•  but in groups, par&es, na&ons and epochs, it is the rule.”

•  Friedrich Nietzsche German philosopher (1844 -‐ 1900)

Le 10 th man http://goo.gl/W1LHmX

The short answer: The Fantasy

(thank you Plato and Descartes !)

The short answer : The reality

The short answer

The short answer : 95 % of the &me , the monkey hold the wheel

Overview of the cards

•  Defence of the mind set •  Social influence •  Habits and personality •  Faulty reasoning, Uncertainty, Complexity

•  Rela&ve thinking •  Automa&c associa&on

Honesty Box

–  In a somewhat spookier example, researchers staged an experiment in a workplace kitchen wherein employees would rou&nely make themselves tea or coffee in exchange for a fee that they would drop in an ‘honesty box’

–  In the first stage of the experiment, the researchers planted a picture of a flowerpot in the room, while in the second stage of the experiment they replaced it with a picture of a pair of eyes

–  The two pictures were then alternated back and forth each week, for a period of ten weeks

Honesty Box

–  In a somewhat spookier example, researchers staged an experiment in a workplace kitchen wherein employees would rou&nely make themselves tea or coffee in exchange for a fee that they would drop in an ‘honesty box’

–  In the first stage of the experiment, the researchers planted a picture of a flowerpot in the room, while in the second stage of the experiment they replaced it with a picture of a pair of eyes

–  The two pictures were then alternated back and forth each week, for a period of ten weeks

–  Finally, the researchers compared how much money was le[ in the honesty box across the 2 situa&ons in the experiment.

–  Here’s Kahneman to explain the results: “no one commented on the new decora&ons, but the contribu&ons to the honesty box changed significantly…

–  On average, the users of the kitchen contributed almost three &mes as much in ‘eye weeks’ as they did in ‘flower weeks.’ Evidently, a purely symbolic reminder of being watched prodded people into improved behavior. As we expect at this point, the effect occurs without any awareness” . This is a very eye-‐opening example of how System 1 can influence System 2, and also hints at the frightening ways that System 1 might be exploited.

First Impression

•  We will describe two personali&es, Alan and Ben, based on their characteris&cs.

•  Select which one you prefer •  Just watch yourself thinking when coming to this conclusion

•  Do not share your finding loudly , we will discuss a[er the experience.

Alan

•  Intelligent, Industrious, Impulsive, Cri&cal, Stubborn, Envious

Ben

•  Envious, Stubborn, Cri&cal, Impulsive, Industrious, Intelligent

Ben Alan

•  Intelligent •  Industrious •  Impulsive •  Cri&cal •  Stubborn •  Envious

•  Envious •  Stubborn •  Cri&cal •  Impulsive •  Industrious •  Intelligent

Cogni&ve Bias according to Kahneman

•  Système 1 and System 2 – Système 1 – Système 2 –  interac&on

Système 1 & 2

Système 1

Système 2

Ou&ls & Projec&ons

Kahneman : summary

•  The Book •  A good summary

hep://newbooksinbrief.com/2012/11/13/24-‐a-‐summary-‐of-‐thinking-‐fast-‐and-‐slow-‐by-‐daniel-‐kahneman/

Cogni&ve Biases

•  80+ : hep://en.wikipedia.org/wiki/List_of_cogni&ve_biases •  300+ : heps://www.recobia.eu/ ( non public) •  Many classifica&ons

–  We took one “ac&onable”, inspired by the DQ 101 Stanford Mooc (Karl Spetzler)

•  Design thinking and Cogni&ve Bias –  @stakken86 thesis on #DesignThinking and #Cogni&veBias hep://goo.gl/wHU8bc

•  My cura&on : hep://www.scoop.it/t/cogni&ve-‐bias

Experimen&ng the switch between S1 and S2

Say loudly how may dots you see in the coming slides , as quickly as possible, and compare reaction time

Are you coun&ng in your head ?

Subi&za&on

•  subi/za/on •  (psychology) The process of, or act of, glancing at a group of a few objects and knowing how many there are without actually coun&ng.

•  hep://en.wikipedia.org/wiki/Subi&zing

Subi&sa&on pictures

A trip to Abilene

•  On a hot a[ernoon visi&ng in Coleman, Texas, the family is comfortably playing dominoes on a porch, un&l the father-‐in-‐law suggests that they take a trip to Abilene [53 miles north] for dinner. The wife says, "Sounds like a great idea." The husband, despite having reserva&ons because the drive is long and hot, thinks that his preferences must be out-‐of-‐step with the group and says, "Sounds good to me. I just hope your mother wants to go." The mother-‐in-‐law then says, "Of course I want to go. I haven't been to Abilene in a long /me."

•  The drive is hot, dusty, and long. When they arrive at the cafeteria, the food is as bad as the drive. They arrive back home four hours later, exhausted.

hep://en.wikipedia.org/wiki/Abilene_paradox

A trip to Abilene

•  One of them dishonestly says, "It was a great trip, wasn't it?" The mother-‐in-‐law says that, actually, she would rather have stayed home, but went along since the other three were so enthusias&c. The husband says, "I wasn't delighted to be doing what we were doing. I only went to sa&sfy the rest of you." The wife says, "I just went along to keep you happy. I would have had to be crazy to want to go out in the heat like that." The father-‐in-‐law then says that he only suggested it because he thought the others might be bored.

•  The group sits back, perplexed that they together decided to take a trip which none of them wanted. They each would have preferred to sit comfortably, but did not admit to it when they s&ll had &me to enjoy the a[ernoon.

hep://en.wikipedia.org/wiki/Abilene_paradox

Group thinking •  A Trip to Abilene

Planning Poker

Timeboxing

– Threat or opportunity – Aversion to loss – Change Resistance – Pomodoro

Rep&lian Brain

Mammal Brain

Confidence is built on the experience of success

Conversa&onal Intelligence

Fear ac&vate Cor&sol and shut down the cortex

Trust, Experiment, Co-‐create

Itéra&ons

Rela&ve Thinking

The Middle Op&on is never selected…

However influence the choice…

(Framing, Anchor)

Framing •  hep://m.youtube.com/watch?v=Ng9V2JneJ68 •  “the five-‐year survival rates clearly favor surgery, but in the

short term surgery is riskier than radia&on” •  When it came to the short term risks of surgery, though, •  half of the doctors were shown stats that referred to the

survival rate (which is 90% a[er one month), •  while the other half of the doctors were shown stats that

referred to the mortality rate (which is 10% a[er one month) .

•  Here’s Kahneman with the results: “you already know the results: surgery was much more popular in the former frame (84% of physicians chose it) than in the laeer (where 50% favored radia&on).

Rela&ve Es&ma&on

•  Wysa& : What you see is all there is. •  Over Op&mism •  Over confidence •  in some quizzes, people rate their answers as "99% certain" but are wrong 40% of the &me

•  93% of American drivers rate themselves as beeer than the median

•  For difficult tasks, the effect reverses itself and people believe they are worse than others

•  hep://en.wikipedia.org/wiki/Overconfidence_effect

Planning fallacy

•  The planning fallacy describes the tendency for people to overes&mate their rate of work or to underes&mate how long it will take them to get things done.[9] It is strongest for long and complicated tasks, and disappears or reverses for simple tasks that are quick to complete.

•  hep://en.wikipedia.org/wiki/Planning_fallacy

•  Another study asked students to es&mate when they would complete their personal academic projects. Specifically, the researchers asked for es&mated &mes by which the students thought it was 50%, 75%, and 99% probable their personal projects would be done.[5]

•  13% of subjects finished their project by the &me they had assigned a 50% probability level;

•  19% finished by the &me assigned a 75% probability level; •  45% finished by the &me of their 99% probability level.

Illusion of control

The monkey is crap at stats, and rare events

He makes no difference between low probability and low impact

if something can be recalled, it must be important

Daily Mee&ng

Confirma&on Bias

Low fidelity Prototype

Sunk Cost Fallacy

Daily Mee&ng

Task Board

– Visualize – Project to understand complexity beeer –  (S2-‐>S1, WYSIATI )

Saturate and Group

Informa&on radiators

Peer Programming

Priming

•  Video •  hep://m.youtube.com/watch?v=HRAKt0GakJM

•  “the ‘Florida effect’ involves two stages of priming. First, the set of words primes thoughts of old age, though the word old is never men&oned (“worried,” “Florida,” “old,” “lonely,” “gray,” “bingo, ); second, these thoughts prime a behavior, walking slowly, which is associated with old age. All this happens without any awareness. When they were ques&oned a[erward, none of the students reported no&cing that the words had had a common theme, and they all insisted that nothing they did a[er the first experiment could have been influenced by the words they had encountered. The idea of old age had not come into their conscious awareness, but their ac&ons changed nevertheless”

Brainstorming: the 65’s way •  Focus on quan/ty •  Withhold cri/cism •  Welcome unusual ideas

•  Combine and improve ideas

Brainstorming: the challenges

•  Blocking •  Collabora/ve fixa/on •  Evalua/on apprehension •  Free-‐riding •  Personality characteris/cs •  Social matching

Divergent and Convergent Thinking

Priming for Crea&ve Conversa&ons

•  Warm vs cold –  head table : Authority ( cold) vs round table ( warm)

– Hard and so[ chairs – Whiteboard : we will have an open, trus&ng conversa&on and will follow through with our agreements

•  Bad Start : Disengage, re engage. Humor.

Priming for Crea&ve Conversa&ons

•  Friend of Foe ? 0,07 s… •  FORCES:

– Fairness – Ownership – Reciprocity – Coopera&on – Open Expression – Status

•  Feel Good <> Trust : (dopamine, serotonine, oxytocin )

Or •  Fearful •  Sad •  Depressed •  Upset •  Angry •  Overly S&mulated

– Excess Dopamine; norepinephrine (stress) –  Increase testosterone – Steroids ( strength) – Cor&sol takes up to 36 hours to clean from body

les demandes d'aide explicites...

Retrospec&ves • What did we do well, that if we don’t discuss we might forget?

• What did we learn? • What should we do differently next /me? • What s/ll puzzles us?

Priming Rétrospec&ve

http://www.retrospectives.com/pages/retroPrimeDirective.html The prime directive says:One of the most obvious fears people have when first trying a retrospective is that the ritual will become a negative gripe session, interspersed with blame and counter blame. Clearly such an event will not contribute to much learning. The key to a constructive successful ritual is assuring that all the participants adhere to the Retrospective Prime Directive. Regardless of what we discover, we understand and truly believe that everyone did the best job they could, given what they knew at the time, their skills and abilities, the resources available, and the situation at hand.

Free Choice of Tasks

– Not invented here

V : Forget you are a human

V : ‘Simplified’ reality

the waterfall « cycle »

•  Which bias are going to show up in this ’cycle’?

Design thinking

•  hep://fr.wikipedia.org/wiki/Design_thinking

•  Le Design Thinking est une méthode de créa&vité et de son management qui se veut une synthèse entre la pensée analy&que et la pensée intui&ve. Il s'appuie beaucoup sur un processus de co-‐créa&vité impliquant des retours de l'u&lisateur final.

Design Thinking

Divergent and Convergent Thinking

Design Thinking Techniques

•  Loss aversion •  Confirma&on bias •  Sunk cost fallacy •  Anchoring bias •  Overconfidence bias

–  Above average : all the children are above average –  limited to “easy” tasks in which success is common or in which people

feel competent. For difficult tasks, the effect reverses itself and people believe they are worse than others

–  Strikes, lawsuits, and wars could arise from overplacement. •  Framing •  Deforma&on Professionelle

Other Prac&ces

•  Serious games •  Lean startup •  Design thinking •  Décision quality

Game storming / Serious games

•  Jeux sérieux •  hep://fr.wikipedia.org/wiki/Jeu_s%C3%A9rieux

Decision Quality

•  heps://novoed.com/DQ101 •  Mooc @ Stanford •  (La classifica&on u&lisée ici vient de la) .

Lean startup

•  hep://fr.wikipedia.org/wiki/Lean_Startup

Take Away

Don’t fight the monkey

•  Bias Exists (and now, you know, too…) •  They can be denied : simplis&c ra&onalism •  They cannot be removed

– There is no bias-‐free “human”

•  Human keep on simplifying reality to make some sense of it

Live with All of you

•  Cogni&ve Dissonance is not ”pleasant” – Empty mind, Bad gut feeling – We were taught to avoid this (conform, align…) – Most Prefer to stay in the ”comfort” zone

•  It takes courage to step out the first &me – But quickly you grow to become a learner, because it is rewarding

•  As a group, this means a transi&on to a learning ‘Process’ / Organisa&on. (e.g. Agile, DT ..)

Knowing and Sharing where CB impact your process

Les biais cogni&fs

Plus ( de surface)

Plus de détails ...

La Table des Ma&eres Du Livre • 

i. Introduc&on/Synopsis • 

•  PART I: AN INTRODUCTION TO THINKING, WITH A FOCUS ON SYSTEM 1 • 

•  Sec&on 1: An Introduc&on to Thought, Fast and Slow • 

•  1. Thought, Fast and Slow • 

•  Sec&on 2: System 1 Under the Microscope • 

•  2. Learning by Associa&on and the Priming Effect •  a. Associa&on •  b. The Priming Effect •  3. Context and Causality •  a. Context •  b. Causality •  4. Judging and Evalua&ng on Limited Evidence: WYSIATI and Subs&tu&on •  a. WYSIATI •  b. Subs&tu&on •  5. When System 1 Judges People: Stereotypes, First Impressions, and the Halo Effect •  a. Stereotypes •  b. First Impressions •  c. The Halo Effect •  6. The Interac&on Between System 1 and System 2 • 

•  PART II: THE ERRORS OF SYSTEM 1 • 

•  7. An Error of Associa&on and Priming: The Anchoring Effect • 

•  8. The Framing Effect • 

•  9. File Under WYSIATI •  a. WYSIATI and Confidence •  b. WYSIATI and Es&ma&ons •  c. The Two Selves •  d. WYSIATI and Op&mism •  10. Causal Errors and Sta&s&cal Illiteracy •  a. Causal Errors •  i. Mistaking Stats for Causes •  ii. Mistaking Luck for Causes •  b. Sta&s&cal Illiteracy •  11. Loss Aversion •  a. Avoiding Losses •  b. Cu�ng Our Losses •  c. Risk Aversion •  12. Expert Intui&on • 

Cognitve biases and project management

Leadership & Management

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