Stop the Noise II— Hurdles to Great Critical, Futures & Strategic Thinking

Grey Swan Guild
10 min readFeb 4, 2024

Relevant Outtakes from Kahneman’s book on “Noise” Part II (Takeaways #10–18)

Author: Sean Moffitt, Grey Swan Guild Founder and CEO, Cygnus Ventures

“Bias and noise — systematic deviation and random scatter — are different components of error.” — Daniel Kahneman, Noise: A Flaw in Human Judgment

In our continuing series, we are leaving our noise at the door and grabbing 25 takeaways from Daniel Kahneman’s 2021 book (with Olivier Sibony and Cass Sunstein), Noise: A Flaw in Human Judgment.

Noise Takeaway #10 — ”There it Is” Confirmation and Desirability Bias

  • human nature and bias and makes us collect and interpret evidence selectively to favor a judgement that we already believe; especially true for emotionally charged issues, and for deeply entrenched beliefs. this is confirmation bias
  • human nature makes us collect and interpret evidence selectively to favor a judgement that we stand to benefit from or will make us look good, this is desirability bias
  • the illusion of understanding masks the mystery of the unknown; the trap of believing we understand phenomena, when in reality, our understanding is merely an illusion

Takeaway #10: Foster a mindset of curiosity, break free from the limitations imposed by wishful certainty and read the polar opposite views on a subject before landing on judgment.

Noise Takeaway #11 — The Rubik’s Cube of Complexity

  • for complex problems, people frequently ignore cues and avoid alternative interpretations of the evidence, Occam’s Razor is sometimes too easy to embrace in the absence of effort
  • human judgment is poor at predicting complex systems, and our biases often lead us astray
  • when dealing with intricate systems, such as economic or social dynamics, the multitude of factors at play makes accurate prediction difficult; our predispositions and cognitive limitations further exacerbate this challenge

Takesway #11: it’s crucial to acknowledge the shortcomings of human judgment and be mindful of our biases in order to make more informed and objective decisions, ensure uncomfortabe data or opinions are not suppressed or neglected (and other strategies to mitigate bias below).

Techniques to Overcome 12 Categoies of Bias — Restructuring structured analytic techniques in intelligence

Noise Takeaway #12 — Overestimating Expert Culture

  • when assessing of future performance and predictiveness, people experience the illusion of validity which is a cognitive bias in which a person overestimates his or her ability to accurately interpret and predict outcome when analyzing a set of data
  • executives like to listen to their gut and most of them like what they hear; the higher rank the executive, the more danger exists of this overestimation based on having been there before
  • you may believe that you are subtler, more insightful and more nuanced in predicting the future (e.g. Kahneman can’t be talking about me — sse fundamental attribution errors), but very few people get to outguess the casino of life

Takeaway #12: when making forecasts, question the sources of validity, use outside views or ‘red teams” to poke at forecasts, and ensure confidence intervals are wide enough for key uncertainties.

Noise Takeaway #13 — Being a Hitchcockian Foresight Chaser

  • experience and intelligence is only part of the story in intelligence about the future; how people think is perhaps more important, when needing to choose — take the most thoughtful, open-minded people not the most intelligent ones
  • a good futures decision maker should adopt two Hitchock titles — they should keep a Shadow of a Doubt and not to be The Man (person) Who Knew Too Much
  • futurists need general mental ability, cognitive reflection and active open-mindedness - the biggest predictive tests for people making future judgements; how would you answer the folliwng questions: “is thinking your idea of fun?”, “I tend to set goals that require considerable mental effort”, “Is allowing oneself to be convinced of a good argument a sign of good character?”. “I consciously avoid movie reviews with spoiler alerts”, and “is changing your mind a sign of strength?”; if you were inclined to say yes, you are on the road to foresight genius

Takeaway #13 : when thinking about establishing your all-star futures, foresight or forecast team look for general mental ability, reflective powers AND open-mindedness, avoid ideologues.

Noise Takeaway #14: Now & Future Professional Noise

  • sensemaking, analysis and many of the social sciences involve evaluative judgments — assessing to what degree a stimulus is liked or disliked as a fundamental aspect of cognition and facilitating comparison and choosing among alternatives, deciding, and prioritizing actions (e.g. “how well did my assistant perform this last year?”)
  • futures, foresights & predictions involve predictive judgments — analysis of current and past inputs to make predictions about future behavior or events (e.g. “how well will my new product sell over the next year, three years, five years?”)
  • both can be noisy, sometimes treated as the same with the same confidence, and switched between each other almost unconsciously, leading to concerns about judgment validity and predictability

Takeaway #14: evaluate your methods of evaluative judgment occasionally over time for consistency and fairness, evaluate your methods of predictive judgment for accuracy and consequences.

Noise Takeaway #15 — Staying in the Objectively Ignorant Zone

  • when you trust your gut because of an internal signal, not because of anything you really know, you are in denial of your objective ignorance
  • the affect heuristic happens when people determine what they think by consulting their feelings
  • excessive coherence is when we form impressions quickly and find comfort in cognitive harmony, favoring subsquent consistent information and holding onto views even when contradictory information comes in; “consistency is often mistaken for accuracy” encapsulates a profound truth about many of our cognitive biases

Takeaway #15: Always suspend some judgment about your understanding of, and your predictive validity, about the future: never go into a research or intelligence venture expecting to see something but not being prepared to refute it.

Visual — Todd Meredith One Track Mind Album

Noise Takeaway #16 — Framing and The Temptation of Substitution

  • “When we substitute an easier question for the one we should be answering, errors are bound to occur”; at the start of an effort, this might be considered poor framing and as it proceeds further down the path we are looking at the heuristic of substitution.
  • heuristics are a popular quick-thinking way of getting to an answer of a more difficult question with an easier, quicker and available one (also consult the availability heuristic here); we see this type of behavior in live meetings all the time where the readily available or urgent answer is the one that groups go with
  • are you answering questions in your own head like: “do I believe in climate change?” with “do I trust the people who say it exists?”, or “am I satisfied with my life as a whole?” with “what is my mood right now?”; you might be guilty of substitution

Takeaway #16 : ensure choice of evidence, pursuit of judgment, collaboration and discussions doesn’t takes the easier route of substituting the easier question than the tougher one assigned; craft expert framing challenge statements at the start of new projects that should take monumental effort before being switched.

Substitution — Availability Heuristic (Source: Decision Lab)

Noise Takeaway #17 — Beware the Confident Heuristic Snake Oil

  • “relative judgments are better than absolutes”; confident assertions are seductive (we fall for them all the time), but often misleading and highlighting the common tendency for individuals to gravitate towards stark, simplistic explanations or solutions — leaders would be wise to couch your important conclusions with caveats
  • while confident simplicity may seem appealing, it can frequently lead us astray by oversimplifying complex phenomena or overlooking important factors; we should be cautious of this allure and delve deeper into understanding the intricacies of the subject matter at hand and explore supporting and dissenting views
  • overconfidence and the inflated sense of one’s own abilities, is a formidable adversary for effective decision-making, often resulting in cloudy thinking, flawed reasoning, erroneous judgments and unfavorable outcomes; we need intelligence consieglieres in our lives that can check our inflated sense of self-belief

Takeaway #17 : The first step is admitting our overconfidence, and engaging critical and constant preview and review of key decisions, strategies and foresight; we can cultivate a more humble and measured approach to decision-making by cultivating Grey Swan thinking that can force opening up our minds to alternate futures and enhancing our chances of making sound judgments by teasing out the range of possibilities.

Noise Takeaway #18 — Blindspots May be Bigger Than They Appear

  • “Humans are poor at weighting evidence correctly, often giving too much importance to irrelevant information”; diversity (perhaps, but not necessarily in the collective social view of the 2024 world) of opinions and independent judgments are fundamental to good collaborative foresight work, this condition is frequently missing from business, government, and certainly on campus
  • we often fall prey to cognitive biases that skew our judgment, placing excessive weight on irrelevant factors, such as personal anecdotes, vivid stories, or superficial characteristics.
  • distractions cloud our ability to objectively assess evidence and impede our capacity to make informed decisions; when a seductive observation is held by a small portion of our population or experiences, are these not decision maker red herrings?

Takeaway #18 : Kahneman’s work serves as a reminder to constantly reassess our blindspots — thinking patterns, biases, heuristics that impede our more accurate understanding of reality (see blindspots visual below); we should be constantly asking whether individuals involved in our work miss out on relevant points of view or expertise.

Read our Part #1 — Stop The Noise Takeaways #1–9, and our upcoming Part #3 — Stop the Noise Takeaways #19–25

Grey Swans — A Month of Specialty Posts:

This is sa special edition of a set of posts on different methods and frameworks for chasing Grey Swans. but we have so much other commentary on this valuable but often overlooked chase for the non-obvious:

I — Grey Swan Week and defining Grey Swans

II — Our 2023 Report Card of Grey Swans (last year’s review and performance)

III — Fifteen Ways to Hunt for Grey Swans (methods and frameworks) —

IV — Stop The Noise I — 25 Outtakes from Kahneman’s book

V — Fifty Grey Swan Wild Card Influences in 2024 (ranking the categories)

VI — Twelve Grey Swans Revealed (<25%) — Cloudy Swans

VII — Twelve Grey Swans Revealed (<5%) — Stormy Swans

VIII — Twelve Grey Swans Revealed (<1%) — Shadow Swans

Stay tuned with us here, as well as on our website for all the rundowns.

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