The Impact of Outcome Bias when reviewing Success
The England cricket team have recently overcome the odds with their victory over Australia in the Ashes. What’s more, they won the Ashes test with one Test to spare, by far exceeding expectations. This victory might lead you to think that they’ve played outstandingly well, and that the team is completely transformed from the one which looked so weak during the cricket World Cup just a few months ago. However, this may not be the case.
Although this was an impressive victory, there is a risk that the victory could act as a double-edged sword as far as future success is concerned. I say this because if England would have lost, coach Trevor Bayliss would be more likely to seek improvement in the future. Victory on the other hand might suggest that everything’s going swimmingly, right?
I’d argue otherwise. Outcome bias is a term used in psychology which means that we tend to regard success as an indication that the decision or process that led to it was good. This can lead to weaknesses in the system or process going unnoticed. To take the example of the English cricket team, victory could suggest that very few, if any, changes need to be made to improve the team.
However, there have definitely been weaknesses throughout the Ashes. The most obvious of which is Adam Lyth’s poor batting form, and I would have to think that the coaches can’t overlook this regardless of outcome bias! However, outcome bias might lead selectors to neglect slightly smaller problems, such as Jos Buttler’s below-par batting and Moeen Ali’s inconsistent bowling.
This can happen in business too. Successfully winning a new piece of work, delivering a good service or achieving a revenue target can lead to celebration but a lack of scrutiny over how the success was achieved. Outcome bias could mean that mistakes that were made along the way are swept under the carpet and then repeated over and over again.
So how do you overcome outcome bias?
The first step is to recognise that it’s a bias that all of us have. By recognising its presence, it’s easier to spot potential weaknesses despite successes, in turn maximising learning. One business that prides itself on its ability to learn is Pixar1. Instead of being blinded by their successful run of animated films, they analyse their performance, constantly seeking to improve by:
- Regularly changing the format of reviews
- Using data to stimulate discussion and challenge subjective views
- Including outside perspectives in reviews where possible.
By engaging with the process, rather than just the outcome, Pixar are able to increase the number of learning opportunities, in turn maximising their likelihood of future success.
In conclusion, successes in sport and business should rightly be celebrated, but not left unexamined. By examining both the process and the outcome, organisations will be able to maximise chances of future success.
Do you think you’re guilty of outcome bias or does your organisation examine both processes and outcomes to search for continual improvements?
1. Gino ,F. & Pisano, G.P. (2011) . Why Leaders Don’t Learn from Success. Harvard Business Review, April, 68-75.