It started out professional enough. Well, somewhat.

It was merely acknowledgment of the charisma, potential and talent of a leader with future potential. Whom she also thought was handsome…in a company that didn’t have a large pool of ‘pleasing to the eye’ male leaders. Every time he spoke she was inspired. I mean, who couldn’t help be inspired by his energy, passion, vision (and that smile…)?!

As time went on she continued to amass evidence on his:

• brilliant (?) leadership potential
• admire his dashing good looks
• be enamored by his observations of the market conditions
• be inspired in his presence

…all the while ignoring protests from her peers who were pointing at evidence to the contrary. It was, for lack of a better term, a work crush.

The irony in this story comes from the fact that she was a senior HR executive with a ‘seat at the table’ and he was a rising business leader. Her data and opinions became significant factors in his promotions, visibility and increased responsibility. Thanks to her he was seen as having the highest ratings of future potential. Despite growing evidence to the contrary.

In other parts of the organization he was seen as mainly very good at selling upwards, impression management and promoting himself. The results of the businesses he led were much less impressive (i.e., negative). Nonetheless, she ensured he made the ‘hi-potential leader list’ that was put in front of the CEO. In fact, over the next few years she placed him on that very list for the CEO every time.

It’s a story from a client I had worked with some years ago, but situations like this happen all the time. You see, after her initial infatuation started things rolling, the brain’s natural processing of information took control. Several psychological phenomena kicked in which biased later interpretation and decision-making.

Spoiler Alert

While this particular HR executive had left the company a few years before this story ends, the social perceptions lingered long after. The ending I wrote about in a previous post, but, suffice to say this rising star imploded spectacularly, there was a mess and it was expensive to clean up.

How did this happen?

The company had access to the very best in personality testing, human resources systems and management consultants. Senior leaders could refer to a knowledge base built from many decades of research on human performance and organizational decision-making. How did some very smart people with good intentions make some bad decisions? I will explain some of the psychology of what I observed and also how you can avoid it happening in your company.

Cognitive Biases

Cognitive biases are ‘tricks’ our brains perform in order to help us deal with the vast amount of information we are trying to process at any given moment. In this situation three were key.

1. Confirmation Bias – Our tendency to look for what confirms our beliefs and ignore what contradicts our beliefs. This becomes more pronounced when our belief is emotionally-laden. For example, during an election it is the tendency to seek out or notice mainly positive information for your favorite candidate and mainly negative information about their opponent.

2. Halo Effect – When positive feelings in a single area cause ambiguous or neutral traits to be viewed positively. If you like someone you are more likely to see all of their actions as positive. This was first scientifically observed by E.L. Thorndyke in the 1920s. In marketing, certain brand names are even able to use the “halo” of their reputation in order to charge a premium price for what is, essentially, a basic product.

3. Self-fulfilling prophecy– Identified by Robert Merton in 1948. When you believe something is true (regardless of whether it is or not) then you act according to this belief. You then subtly change your attitudes and behavior in line with this belief. When things turn out the way you expected you believe it was because your original opinion was correct and don’t see how your own actions influenced the situation. It’s like a placebo effect. Someone takes a drug believing it will improve their health. Their health often does improve, more often by subtle or unnoticed changes in their behavior and less by whether or not the drug was effective.

Documented phenomena

All of these phenomena are well documented, with the earliest scientific evidence almost a hundred years old and some of the latest backed by MRI imaging. However we continue to downplay both their existence and ability to interfere with decision-making.

As Brooks Jackson and Kathleen Hall Jamieson  from Factcheck.org have observed,

Humans are not by nature the fact-driven, rational beings we like to think we are. We get the facts wrong more often than we think we do. And we do so in predictable ways: we engage in wishful thinking. We embrace information that supports our beliefs and reject evidence that challenges them. Our minds tend to take shortcuts, which require some effort to avoid … [and] more often than most of us would imagine, the human mind operates in ways that defy logic.

How can you avoid this happening in your company?

1. Awareness. Our brain is designed to reduce complexity for us. It can speed up our decision-making and make things simple for us to comprehend. It does this by creating ‘short cuts’ for us (these cognitive biases). Since this is the natural or auto-pilot we are designed by nature for then we must anticipate where this tendency may interfere with our decision-making.

2. From Process to Evidence. Human Resources Departments are very good at creating processes to ease decision-making. What is needed is a shift from processes that make things more simple to processes that increase not only relevant evidence but also in evidence-based conversations.

3. Data Fluency. We will have more data at our disposal than we will know how to manage.. Understanding if the data accurately measures what it purports to measure (validity) and does this without error (reliability) is paramount if we are using this data to make important decisions.

In the situation I described, once the psychology of human information processing took over. An executive infatuation led to some costly business decisions. By understanding these cognitive biases, using better evidence and increasing our data fluency we can help prevent our decision-making being hijacked by our nature. What have you found useful to support effective decision-making on key talent issues?

Robert Kovach is the Director of Leader Success for Cisco’s Leadership and Team Intelligence Practice Area. He has been an advisor to leadership teams of Fortune 500, FTSE 100 and FTSE Global 500 companies on driving business strategy through executive leadership effectiveness and organizational agility. The opinions expressed in this blog are his own and not those of Cisco. Contact him for speaking enquiries.

Illustration courtesy of Flickr CC and tOrange.biz