What's Your Blind Spot?
How Cognitive Biases Limit You as a Leader

by Carl Phillips

It’s been over 22 years since the roll-out of The Garden Center Group Mystery Shopper Program. Over three thousand, six hundred (3,600+) shops have been completed that form the basis for great customer service benchmarking.

Carl Phillips has been instrumental in the program development since its inception. He is known as one of the mystery shopper industry founding fathers and The Group is blessed by having his guidance. Carl shares a number of blog articles every year and the following is one he shared last month. We think it is timely for your review.

Few would argue the importance of leadership. Yet only 23 percent of employees strongly see their organization's leadership as effective.

The task of being an effective leader is a difficult one. All the real work of organizations gets done through people, individually or collectively, on their own or in collaboration with technology. Thus, central to a leader's role is the management of your team's behavior.

But this effort is often thwarted by your own cognitive biases--those mental shortcuts that cause you to ineffectively diagnose a situation, repeat the same mistakes, overlook problems, and improperly address issues. Since the crucial part of leadership success is the ability to engage and change the behaviors of employees, it's essential to understand the cognitive biases that impact how you make decisions and lead teams effectively. Here's a short list of a few that commonly occur in leadership roles.

Confirmation bias
Confirmation bias refers to your tendency to search for, favor, and focus on information that supports your preconceived perceptions, meaning you're likely to ignore or reject contradictory information--resulting in flawed decision-making. For example, if you are happy with an employee's performance, you might easily let that employee get away with making a mistake that otherwise would have required disciplinary action. On the other hand, if you're displeased with an employee, you are prone to embrace evidence that confirms the employee's mistakes and weaknesses.

Dunning-Kruger effect
This refers to your tendency to overestimate your skills and knowledge while underestimating your ignorance or how bad you are at certain things. If you're a subject-matter expert, you tend to underrate your abilities. More specifically, since you know so much about an individual subject, you can see the gaps in your knowledge and identify mistakes, when those mistakes are imperceptible to non-experts. This can also manifest negatively. For instance, you might have an employee who thinks they're brilliant, but behind the curtain, other people must pick up the slack and fix their mistakes.

Sunk-cost fallacy
Often referred to as throwing good money after bad, this cognitive bias describes your tendency to increase investment in a decision or continue down a path on the basis of previously invested time and resources, even if the current costs outweigh the benefits. Say your department spends millions of dollars on a marketing campaign that totally bombs. Instead of scrapping that campaign and trying something else, you continue to run it in the hopes of getting some returns on that initial investment.

Bandwagon effect
This is when you adopt a certain attitude, behavior, or style because other people are doing it, regardless of your personal beliefs. The pressure to conform, the desire to be on the winning side, the fear of exclusion, and the need to belong all influence the bandwagon effect. As a leader, if you keep nodding your head to whatever idea is presented and are not willing to voice a disagreement or alternative opinion, there will be no room for creativity and innovation to thrive. When your team copies what other departments are doing, especially if those behaviors are negative, the result is a workplace devoid of healthy conflict and productive debate.

Planning fallacy
This cognitive bias describes your tendency to overly underestimate the amount of time it will take to complete a task, along with the costs and risks associated with that task. Say you create a plan, which is usually a best-case scenario. Then you assume that the outcome will follow your plan, even though you may be aware of external factors and influences that could delay or derail it. You don't have to work on colossal projects to fall prey to the planning fallacy--you may predict you'll finish a new project within a couple of weeks when the work requires a month.

Anchoring bias
The anchoring bias means you rely too heavily on the first piece of information you receive when making decisions. When you become anchored to a specific idea or plan, you're more unwilling to evaluate new information objectively, leading to skewed judgments and distorted perceptions. Anchoring bias also occurs in brainstorming sessions, where each team member shares ideas, but the consensus consistently backs the first idea presented.

How can you overcome these biases?
First and foremost, acknowledge that cognitive biases exist everywhere and affect everyone. Second, reflect on situations where you made decisions with poor outcomes. Third, think about how you made that decision, and whether a bias could have influenced your behavior. Lastly, examine how you can approach that decision differently in the future given your understanding of cognitive-bias influence.

A lot of the leadership challenges you'll face in business aren't issues of process or protocols but of people and behavior. When you take time to understand how cognitive biases influence how you think and behave, you'll be better able to identify those mental traps, guide your team to avoid them as well, and in turn, become a more effective leader.

Bad info in, bad results out
Are your biases based on good solid information or hearsay?

Are you relying on input, relating to your customer's experience, on a hand full of vocal customers?

When it comes to service level biases make sure you getting quantitative input from a cross section of customers. We can provide that insight in order to help your team improve service levels and your business. We're here to help you with The Garden Center Group Mystery Shopper Program!

Carl Phillips
Vice President
Mystery Shopper Services
and The Group's Mystery Shopper Program Guru

Learn more about The Group's Mystery Shopper Program HERE.

A special THANK YOU to Carl Phillips for all his many years of guidance in devleoping The Group Mystery Shopper Program!