Mental Shortcuts - Hindsight Bias

Hindsight Bias

Have you ever looked back at an event and thought to yourself, “I knew that was going to happen”? You’re not alone. This is the hindsight bias at work. It’s that feeling of being an expert after the event has occurred. The hindsight bias is also known as the “I told you so” phenomenon. It’s when we look at past events and everything seems clear and inevitable. However, the reality is that our memories are often distorted and poor at accurately remembering the past. The hindsight bias is a memory distorter, and it causes people to misremember things they said, their past opinions, and makes people overconfident in explaining all the reasons why something happened.

Think of it like a computer virus that rewrites your past opinions to fit with what actually transpired. This memory distortion always distorts in your favor, making it seem like you knew what was going to happen all along. The hindsight bias is harmful to decision makers, doctors, coaches, CEOs, and financial advisors because onlookers judge them not on the soundness of their decision making but on whether the outcome was good or bad. We tend to blame good decision making that led to a bad result, but praise bad decision making that led to a good result.

It’s easy for us to oversimplify the past when we know all the facts of what transpired, but at the time, there was doubt, uncertainty, or complexity. It’s important to be aware of the hindsight bias and to practice humility in decision making. We shouldn’t blame ourselves or others for not predicting the future, and we should acknowledge that hindsight is 20/20. So, the next time someone says, “I knew that was going to happen,” remind them that the hindsight bias is at work, and we can’t always predict the future with perfect accuracy.

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