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As a leader, it’s important to look for and process a broad range of information from many perspectives. It’s equally important to be open to alternatives not previously considered. The more perspectives and strategies you have to choose from, the more likely it is you will make the best decisions for your team and organization as a whole.
But a powerful, yet subtle obstacle can stand in the way of open-mindedness in leadership: unconscious bias.
What is unconscious bias?
For most of human history, people experienced very little new information during their lifetimes. Decisions were based on the need for survival. In our modern world, we are constantly receiving new information and have to make numerous complicated choices each day. As many researchers have explained, our minds are ill-equipped to handle the modern world’s decision-making demands. Evaluating evidence (especially when it is complex or ambiguous) requires a great deal of mental energy. To save us from becoming overwhelmed, our brains have a natural tendency to take shortcuts. Unconscious bias – also known as cognitive bias – refers to how our mind can take shortcuts when processing information. This saves time when making decisions, which is especially helpful when we’re under pressure and need to meet deadlines. While these shortcuts may save time, an unconscious bias is a systematic thinking error that can cloud our judgment, and as a result, impact our decisions.
See if you can answer this riddle: A bat and a ball cost $1.10 in total. The bat costs $1.00 more than the ball. How much does the ball cost?
Did you answer 10 cents? Most people do. Although this response intuitively comes to mind, it is incorrect. If the ball costs 10 cents and the bat costs $1.00 more than the ball, then the bat would cost $1.10 for a grand total of $1.20 for the bat and the ball. The correct answer to this problem is that the ball costs five cents and the bat costs (at $1.00 more) $1.05, for a grand total of $1.10.
If you answered 10 cents to the example above, your mind took a shortcut by unconsciously substituting the “more than” statement in the problem (the bat costs $1.00 more than the ball) with an “absolute” statement – the bat costs $1.00. It makes the equation easier to process: if a ball and bat together cost $1.10 and the bat costs $1.00, then the ball must cost 10 cents.
Our unconscious mind uses embedded, unconscious beliefs formed from our cultural environment and personal experiences to make immediate decisions about everything around us. The problem is that these shortcuts result in wrong decisions much of the time – especially when rational, logical thinking is required. We all have unconscious bias, and it influences our decisions without us even realizing it.
Common types of unconscious bias
An article in The Atlantic states there are at least 100 distinctive cognitive biases, while Wikipedia’s List of Cognitive Biases contains more than 185 entries. Many of the unconscious biases listed, such as the IKEA effect (to place disproportionately high value on products you help create yourself) don’t present themselves often in the workplace. The following unconscious biases are the most common in the workplace and have the potential to derail your decision-making ability as a leader:
Sunk cost bias
You non-sensically cling to things that have already cost you something. When you’ve invested time, money, or emotion into something, it can be difficult to let it go – even when it is clear it’s no longer viable. The aversion to this pain can distort your judgment and can cause you to make ill-advised investments.
To combat this bias: ask yourself if you haven’t already invested time, money, effort, or emotion into something, would you still do so now? What advice would you give to a friend in the same situation?
Halo effect
The halo effect occurs when you allow your personal perception of someone (how attractive they are, how much you like them, how much they remind you of yourself) to influence your judgments about them, especially performance. In sociology, this is known as homophily - people like people who are like themselves.
To combat this bias: If you notice you are giving consistently high (or low) performance grades across the board to particular individuals, it’s worth considering your judgment may be compromised by the halo effect. Focus on the performance and not on the person.
The Dunning-Kruger effect
The Dunning-Kruger effect describes what happens when people mistakenly overestimate their own ability because of a lack of self awareness. Have you ever heard the phrase “you don’t know what you don’t know”? It’s easy to be over-confident when you only have a rudimentary perspective of how things are.
It also works the other way. Because experts are keenly aware of how much they don’t know, they can drastically underestimate their own ability and lose confidence in themselves and their decision-making ability. This bias is also known as “imposter syndrome.”
To combat this bias: acknowledge the thoughts you have about yourself and put them in perspective. Learn to value constructive criticism, and understand that you’re slowing your team down when you don’t ask for help.
If you’re feeling like an imposter, it can be helpful to share what you’re feeling with trusted friends or mentors. People who have more experience can reassure you that what you’re feeling is normal. Knowing that others have been in your position can make it seem less scary.
Availability heuristic
This unconscious bias influences your judgments by favouring the ideas that come most easily to mind. Similar to recency effect, the more recent and emotionally powerful your memories are can make them seem more relevant. This can cause you to place an inordinate amount of importance on recent memories and apply them to decisions too readily.
To combat this bias: use metrics and statistical information rather than relying on first instincts and emotional influences when making a decision.
Groupthink
The desire for conformity and harmony within a group results in an irrational or dysfunctional decision-making outcome.
To combat this bias: seek to facilitate objective means of evaluating situations and encourage critical thinking practices as a group activity.
Confirmation or Implicit Bias
Confirmation bias causes us to look for evidence confirming what we already think or believe in and to discount or ignore any information that may support an alternate view. It’s the most pervasive unconscious bias in the workplace and the most damaging.
“What the human being is best at doing is interpreting all new information so that their prior conclusions remain intact.” — Warren Buffett
Accepting information that confirms our beliefs is easy and requires little mental energy. With confirmation bias, when we encounter contradicting information we avoid processing it and find a reason to ignore it. In The Case for Motivated Reasoning, social psychologist Ziva Kunda wrote “we give special weight to information that allows us to come to the conclusion we want to reach.” In fact, neuroscientists have demonstrated that our brain reacts differently to information that confirms our previously held beliefs than it does to evidence that contradicts our current beliefs.
If a leader’s view is limited by confirmation bias, they may not pay enough attention to information that could be crucial to their work. Leaders need to be aware of how their biases might impact the people that work for them and with them. For example, direct reports may not share all available information, or may only tell a leader what they think their leader wants to hear. This can lead to poor decision-making, missed opportunities, and negative outcomes.
To combat this bias: think of your ideas and belief system as a piece of software you’re trying to de-bug, rather than a list of things to be defended. Ask yourself the following questions and be mindful of your thought process when answering them:
- Where do I get information about the issues I care about?
- Do my most common sources of information confirm or challenge my perspective?
- How much time do I spend listening to or reading opposing points of view?
- When I make decisions, am I likely to choose the option that the people closest to me will agree with?
Being cognizant of confirmation bias is not easy, but with practice, it is possible to recognize the role it plays in the way we interpret information and make decisions.
How unconscious bias can impact inclusion and diversity in an organization
The correlation between diversity and financial performance is clear across different industries and regions: more diverse teams translates directly to significant financial performance. Between 2011 and 2015, the most gender diverse companies were 20 per cent more likely than the least diverse to have above average financial performance.
For organizations to attract the most talented people and ensure a vibrant and diverse workforce, they need to select from a wide-ranging and diverse talent pool. Unfortunately, when hiring, assessing, or promoting employees, we often evaluate people against our unconscious assumptions of what top talent looks like. These assumptions can favour one group over others, even if members of each group are equally likely to be successful.
During the hiring process, hiring managers gather a wide array of information about job candidates. Through interviews, candidates will share their educational background, work and personal experiences, and how they would behave in hypothetical situations. But most of the time hiring managers are measuring this information against their own personal belief of what the successful candidate “should” look like. Did they go to the right school? Would they behave in the same manner as I would in the same situation? Is their personality a close match to mine (see halo effect above) and the rest of my team?
Most hiring managers will select candidates who best match their unconscious template of what a successful candidate looks and sounds like. This approach can give preferences to the “safe” choice. For example, a hiring manager may believe that only MBA graduates from elite business schools are suitable to fill leadership roles. And if that criteria were applied to all vacancies, you would soon develop a leadership team of predominantly white males, as most MBA graduates are male and white. Because diversity spurs innovation, the organization would then be at a competitive disadvantage.
Innovation is not just a nice-to-have benefit of having diverse work teams. It is an integral part of any revenue-generating organization. A Boston Consulting Group study found that organizations with more diverse management teams have 19% higher revenues from innovation alone.
How unconscious bias can be avoided
Although unconscious bias can’t be cured, there are many steps that can be taken to mitigate it. Leaders who can recognize their unconscious biases and make adjustments to overcome them are more likely to make better decisions. To be ever-mindful of unconscious bias, it’s important to practice self awareness and slow down decision making to consider what is driving you. Ask yourself if your decisions are data-driven and evidence-based or if you rely on gut instinct? Have you asked for and considered different perspectives? It can be helpful to discuss your decisions and behaviour at work with an Ivey Academy executive coach. An executive coach can provide a sounding board, a neutral perspective, and applicable strategies to help you overcome your unique unconscious biases.
Promoting inclusion and diversity
To promote inclusion and diversity in your organization's hiring practices, appropriate procedures and processes need to be put in place. To eliminate bias in hiring decisions, make promotions fairer, and increase diversity, organizations are using data-driven talent assessments.
Organizations that use robust assessment tools have improved hiring success rates, lowered employee turnover, increased employee engagement and productivity, and fostered a resilient corporate culture. Assessments provide organizations with a consistent definition of what leadership potential looks like, regardless of race, gender, or ethnicity. With the help of assessment tools, leaders are able to find “hidden gems” — employees who have low visibility or who previously were not seen to have leadership potential. Most importantly, talent assessment tools help to educate leaders about the difference between an employee’s experience and his or her capability to take on new and more challenging responsibilities. With the help of talent assessments, you can be confident in knowing your organization is taking a needed step in removing unconscious bias from the hiring process.
The Ivey Academy’s talent assessment tools enable your organization to identify the best candidates for vacant roles and professional development. With our help, your organization can create and maintain a competitive edge in the recruitment, development, and retention of top talent. Learn more about our talent assessments here.
About The Ivey Academy at Ivey Business School
The Ivey Academy at Ivey Business School is the home for executive Learning and Development (L&D) in Canada. It is Canada’s only full-service L&D house, blending Financial Times top-ranked university-based executive education with talent assessment, instructional design and strategy, and behaviour change sustainment.
Rooted in Ivey Business School’s real-world leadership approach, The Ivey Academy is a place where professionals come to get better, to break old habits and establish new ones, to practice, to change, to obtain coaching and support, and to join a powerful peer network. Follow The Ivey Academy on LinkedIn, Twitter, Facebook, and Instagram.
