The Knowledge@Wharton interview with Michael Lewis, the author of The Undoing Project, was interesting for several reasons. First, it covered cognitive biases, one of my favorite topics. Second, the book is about Amos Tversky and Daniel Kahneman, two of my favorite thinkers. Third, there were some insights that came from this interview relevant to lean management.
We’ve known for a couple of decades about cognitive biases. These biases, or mental errors that we all make in decision-making and perception, affect everyone. These biases worsen our health, affect our relationships, lose us money. The interview raises a great point, “The question is why, having identified these cognitive illusions or whatever you want to call them, they persist. We don’t pay more attention to them.”
Taiichi Ohno wrote in Workplace Management about what he called misconceptions. He said that half of what we believe is wrong. We just don’t know which half, so we must to be ready and willing to admit that we are wrong and to change our minds. This is especially important if we are in a position to lead others. Ohno did not have the formal training in mathematics or psychology as did Kanheman and Tversky, but it seems to me through his observation of people Ohno broadly recognized many of the same behaviors.
The idea of cognitive biases as persistent illusions, ones we continue to see even if we know that we are seeing illusions, is a potent one. From the interview,
“Even if I tell you that that’s not water on the desert highway, that’s a mirage, you know intellectually, yeah, that’s right. You still see the mirage. The optical illusion doesn’t go away.”
Just knowing that we fall for the biases doesn’t make it easier to avoid them.
“It’s very hard for a person to self correct. What you can do, Amos would say, is change your environment in which you make decisions, so people are more likely to point out to you if you’re making errors.”
Lean is also much concerned with changing our environments in order to change behaviors and ultimately, to improve outcomes. Specifically, this is why lean management relies heavily on visualization both in the physical workplace as well as in monitoring progress toward less tangible outcomes such as strategies, system performance and adherence to standards. Good visual systems make it easier for people to point out when we are making errors.
“It argues for decision-making environments that aren’t autocratic and an approach to decision making where the decision maker isn’t assuming he’s infallible or has unbelievable gut instinct.”
In lean practice this notion is supported by hoshin kanri, which questions assumptions, whittles down strategic initiatives from the hopeful many to the realistic and vital few, engages people in developing action plans through catch ball, reviews progress through fact-based go see exercises, and applies the PDCA cycle to learn from mistakes rather than blaming, sweeping them under the rug or otherwise being self-deceptive.
In battling cognitive biases, as in lean management, we trust our people and our instincts, but “You build checks into the process” at every level, to borrow a quote from the article.
We’ve known for a couple of decades about lean management. We still have biases, habits, illusions that keep us from adopting better ways of working, managing, leading, living. It’s a bit of conundrum. As methods to counter our biases become better known, perhaps we will get better at recognizing the illusions that are part of how our brains work.