The authors of the article warn of the dangers of our natural over-optimism. “Almost all of us,” they write, “believe ourselves to be in the top 20% of the population when it comes to driving, pleasing a partner, or managing a business.” This applies to managers making strategic decisions, including decisions whether to acquire or merge with other companies. Over-optimism, for example, leads to the underestimation of the technical challenges involved in large infrastructure projects, or the time needed to complete them – hence the extraordinary frequency with which such projects over-run their budgets and their deadlines.
The article also warns of the risks of “sunflower management”, the tendency of all heads to turn in the same direction as that of the boss. The authors say that managers should become more aware of how biases can affect their decisions, and then take measures to counter them. But don’t almost all of us think we are doing that exceptionally well already?
