- The planning fallacy
- Hope is not a recipe for change
- How to create realistic plans and strategies
The Planning Fallacy
Four years ago, I read Daniel Kahneman's Thinking: Fast and Slow over the Christmas break. Few books have had quite the same long-term impact on how I think (ha, see what I did there) and I'm scheduling it for a re-read.
The cognitive bias I remember most, and talk most often, is about the planning fallacy. Humans are terrible "intuitive statisticians" - as Kahneman puts it. We wildly underestimate how long it will take us to do something, because we're over-optimistic about our performance. We write long lists with small budgets and short delivery timeframes, and we're surprised and disappointed when we don't pull it off.
I think this is a useful bias to be aware of. It doesn't matter how productive or well organised you are, if your starting expectations and assumptions are wrong. You're setting yourself up to fail.
It's not just optimism, it's ignorance
In order to be classed as a case of planning fallacy, your plans and forecasts need to meet these two criteria:
1. they are unrealistically close to best-case scenarios
2. they could be improved by consulting the statistics of similar cases
That is: there was a track record, and you ignored it. You didn't plan around the most likely scenario, you thought you could rewrite history, and as a result, your whole plan or goal has gone off-track. If you'd erred on the side of history, you'd have planned - and achieved - better.
People do this all the time: we think our renovation will be the only one that's completed ot time and budget, even after watching our friends suffer with a drained bank account and a months-long construction zone. Then, we suffer all kinds of stress, financial risk and disruption when our renovation doesn't go to plan.
We assume our technology project will go off without a hitch, even though the reference class advises a 200%+ contingency on time and budget. Then, when we're already 6 months over schedule and facing heat from the exec team, we have to descope, cut back on training, work late nights and defect on other obligations.
The suffering wasn't inevitable in any of these situations. The suffering was a result of the mismatch between our expectations and reality, which was exacerbated by ignoring history.
There's an arrogance here, assuming we have access to some kind of skillset or insight that others don't. But it isn't just about arrogance, because we apply the same thinking to ourselves.
We think this week will be the one we hit our bedtime target every night, or finish that big project once and for all - even though none of our previous weeks suggest this is likely. We think this relationship will go differently, even though we've had the same battles with every partner in the past.
Hope Is Not A Recipe
I kind of love this ridiculousness for us - we're creatures of hope, aren't we? We'll be different! The world can be different! Everything is going to be awesome now! Starry eyes and hopeful dreams. It's lovely.
Except hope is a poor strategy for change. And if you combine that hope with a few other ingredients, like:
- Unrealistic expectations of yourself and others
- Shaming or punitive self-talk and internal dialogue
- Failure to implement corrective systems and strategies
- Ignorance of your track record, constraints and shortcomings
- Compromise of your wellbeing in pursuit of an unrealistic goal
Well... that's not a recipe for change. It's a recipe for disaster.
Overcoming the planning fallacy is hard work - as Kahenman makes clear, even statisticians struggle with this one. But you can ease the stress by building systems, habits and relationships that keep you grounded, test your thinking, and create space for growth.
What to Do Differently
I don't know what's failed for you lately. It might have been a project, or a relationship. It might have been everything-because-you're-so-f**king-overwhelmed-you-don't-even-know-where-to-start-but-why-isn't-it-working-when-you're-trying-so-goddamn-hard-for-f**ks-sake.
I'm sorry. Failure sucks. It doesn't matter how we dress it up - it's not cool, fun, or exciting to fail at something you care about. It's hard, and it takes a toll. It chips away at our happiness, corrodes our self-belief and makes us wary of trying new things and chasing our dreams.
But please don't throw your hands in the air, or give up. You're great. You're doing this because you care. You've made heaps of progress - just look at past you! They wouldn't even have tried to tackle this!
We just need to recalibrate a few things. Here's three helpful starters:
- Face up to the past
- Design for constraints
- Reflect and celebrate often.
1. Face up to the Past
You need to know your reference class.
For big projects like change programmes or renovations, that means finding how long things usually take, how much they usually cost, and what obstacles and challenges usually get in the way.
For personal development, that means asking yourself: what do you usually do, and how does it usually turn out?
2. Design for Constraints
Plan on the basis that without (or even with) targeted intervention and alternative strategies, those things will happen again.
Assume it will take longer, cost more, be more stressful, and progress will be less linear than you'd like.
Write a list of all the most likely points of failure, and develop a simple approach or strategy that will mitigate each of those risks. Then, plan for what you will do when some version of those things still happen.
💡 Tip: try Tim Ferriss' Fear Setting Exercise for this.
3. Reflect and celebrate often
No matter how good your plan is, it will be wrong almost immediately. So, build in reflection and review. Identify the key milestones that you should stop and celebrate at. Intentionally schedule reflection time - a weekly review, fortnightly budget meeting, or monthly relationship check-in.
Spend that time reviewing your forecast, checking the reality, and planning for the next phase.
- What did you think would happen?
- What did happen?
- Why did that happen?
- What has that taught you about your assumptions?
- How will you change your assumptions for the next phase?
Acknowledge and celebrate the things that have gone well, and approach the setbacks like a scientist testing a hypothesis. Check the cause, modify your approach, and move forward.
There's No Done. Only Doing.
You can't escape the past, and you can't rewrite history. You're no different to the other people who've tried to do what you're doing, and you're still the same person who messed up last time. But you're not stuck. You can do the stuff you care about.
It will take longer, be more difficult, and have more setbacks than you expect. You will be shit sometimes. You will make mistakes, go backwards, waste money, slack off, get tired, and be disappointed by yourself and others. That's OK.
Just don't drive yourself into a hole trying to pull off the impossible. Don't hold yourself to unfair and unrealistic standards. You'll do your best, and your best won't be as good as your plans expect it to be.
All you can do is keep going. Face up to the past, design for constraints, and reflect and celebrate along the way.
There's no done. Only doing.
Til next week,
A
Alicia McKay
