In the blog this week, we will conclude our examination of factors that can disrupt effective time allocation management by reviewing the impact of optimism bias.
Defining optimism bias and the potentially fatal attraction
Put simply, optimism bias is a cognitive planning fallacy in which the tendency is to significantly underestimate the time and resources required to complete a task while recklessly overestimating the ability of achieving a successful outcome in the period assigned (Sharot, 2011). Note here that this challenge should not be confused with the generally positive orientation of being optimistic in contrast to a tendency towards pessimism.
Then, the reason this fallacy can be very seductive is that it provides a temporary sense of comfort by reducing any immediate experience of stress and anxiety in relation to some project schedule time constraints.
Moreover, this challenge to any realistic hope of effective decision-making in relation to project management primarily arises by failing to critically evaluate potential planning risks, wilfully ignoring evidence of past project shortcomings, and then adopting the groundless comforting position that ‘This time, things will be different.’ Really?
Some examples of the negative consequences of this planning fallacy
There are numerous examples of the disastrous consequences of optimism bias, especially in industries such as construction and defence procurement. For example, the world-renowned Sydney Opera House was originally scheduled to be completed in four years with a budget of AUS $7 million, but it ended up taking 14 years and cost AUS $102 million.
Furthermore, on the international stage, this fallacy is commonly considered the cause of the financial crisis of 2007–2008. Here, key individuals, analysts, and even governments were collectively all too groundlessly optimistic that the global economy would grow, while markets would continue to be profitable. Consequently, markets simply ignored information that signalled negative alternative possibilities. This example also illustrates that where several people or groups share unrealistic optimistic expectations bias accumulates reinforcing what might be called an event blindness.
Then, in relation to the education system, research reported by Buehler et al. (1994) highlighted that 68% of students who originally claimed to be optimistically committed to the completion of assigned work on schedule eventually reported that they had finally submitted assignments either later than expected or at the last minute. Moreover, students most inclined towards optimistic predictions tend to be the least able to complete assigned work on time.
Some initial steps that can limit the challenge of optimism bias
Therefore, given the ever-present threat of the tendency towards optimism bias in all aspects of our daily experience, it is important to immediately focus on the following countermeasures.
First, critically review past performance and the consequences in relation to similar tasks.
Secondly, carefully evaluate the current task requirements.
Next, construct a simple project plan outline.
Then, estimate a realistic time allocation for each step in the project process.
Also, be prepared to constantly adjust plans to allow for extra time if required.
At the same time, get started on tasks early and avoid excuses for any delay.
After this, take responsibility for the task and do not wait for others.
Finally, avoid blaming others or events for planning weaknesses and failures.
Question 1
Are there any possible positive outcomes to optimism bias?
Question 2
What factors can motivate people to ignore past performance and consequences when attempting to complete current assigned tasks?
Question 3
To what extent would learning effective project planning skills limit the impact of optimism bias and other time allocation challenges such as procrastination?
We will begin to explore the critical issue of how to develop effective project planning skills in the blog next week.
References
Buehler, R., Griffin, D., & Ross, M. (1994). Exploring the “planning fallacy”: why people underestimate their task completion times. Journal of Personality and Social Psychology, 67(3), 366–381. http://dx.doi.org/10.1037/0022-3514.67.3.366
Sharot, T. (2011). The optimism bias. Current Biology, 21(23), R941–R945. https://doi.org/10.1016/j.cub.2011.10.030
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