Ever the optimist
Have you ever signed up for a long-term membership at a health club, then rarely used it? Do you forget to actually claim the mail-in reimbursement offer on the new television you bought? Yes? Then join the club. The phenomenon is called planning fallacy. It is about how bad most of us are at looking into the future, starting with how we ourselves will behave.
To demonstrate the point, researchers ask survey subjects to make plans in areas where they have experience. Then they compare the subjects' beliefs about their past experiences to their predictions for a current task. The result is almost always unrealistic optimism. University students predict they will finish current assignments 10 days early, even though in the past they barely met deadlines; taxpayers characteristically make the same sort of whacky prediction, in total contrast to their filing times in the past.
Planning fallacy is often more pronounced in groups: they tend to whip themselves into an even greater state of optimism, grossly overestimating how soon things will get done.
Less complicated activities - like a single, one-person task - can be fairly accurately estimated based on long and varied experience. But trouble starts when people are asked to plan more complex or novel undertakings. These are the sort that can cost organisations large sums of money and long-nurtured social capital, such as entering a new market or, in the public sector, implementing a new policy.
Planning fallacy is based on a single broad principle that can be applied to a wide variety of forecasts and judgments about the future - including estimates of the time, money or effort a task will involve. Globally, people uniformly tend to under-weigh information and their own experience when making plans. They are prone to be overly confident in their probability assessments and risk awareness. So, while some groups can be overly pessimistic in their predictions, as psychologist Daniel Kahneman has noted, over-optimism is the rule.
Some researchers have hypothesised that, in a group, individuals tend to forget their own personal experiences. But that is not true: group members continue to be over-optimistic even when they are specifically reminded of relevant past experience. For example, they will be asked about past experiences immediately before the group assesses its current plans and predictions. People explicitly reject the relevance that the past has for the future, the general for the specific, and the worst-case for the most likely future scenario.
Knowing about and understanding the planning fallacy does not seem to help overcome it. Even researchers themselves make the same mistakes as the rest of us. A cardinal example was when one group of academics predicted that their joint textbook would be completed within a couple of years - even though they all knew that similar projects had taken many years and most were ultimately abandoned unfinished.
An evolutionary psychologist would look for an explanation for the planning fallacy in natural selection. It isn't hard to imagine why it was the doggedly optimistic among our ancestors who had the best chance of surviving and reproducing. Anyway, are we really talking about human error or the infinitely more subtle topic of human nature?
If academia were dominated by women instead of men, I believe more theses would be written about the opposite phenomenon - that is, of people making plans on the most unnatural basis possible: a mathematical review of the past. After all, you'd think the first agonising experience of childbirth would teach women not to plan a second.
Jean Nicol looks at everyday issues from the point of view of a psychologist
