Point Lookout: a free weekly publication of Chaco Canyon Consulting
Volume 11, Issue 29;   July 20, 2011: Self-Serving Bias in Organizations

Self-Serving Bias in Organizations


We all want to believe that we can rely on the good judgment of decision makers when they make decisions that affect organizational performance. But they're human, and they are therefore subject to a cognitive bias known as self-serving bias. Here's a look at what can happen.
Daffodils of the variety Narcissus 'Barrett Browning'

Daffodils of the variety Narcissus Barrett Browning. Narcissus, the scientific name of the genus commonly known as daffodils, is a name taken from Greek mythology. Narcissus was a hunter known for his beauty, of which he was very proud. In the myth, Nemesis, who was the goddess of revenge or divine retribution, became aware of Narcissus' extreme pride, and attracted him to a still pool, where he saw his own reflection. Narcissus fell in love with his reflection, unaware that it was just an image. He became unable to leave it, and soon died.

Self-serving bias is blind in the same way. When we're under its spell, we?re unaware of it. We cannot see that our judgment is distorted — only others can see the distortion. Photo courtesy www.nps.gov/media/photo/view.htm?id=FA2D1735-155D-4519-3EDB376118F7A8A6.

Self-serving bias is an example of a cognitive bias, which is the human tendency to make systematic errors based on thought-related factors rather than evidence. Cognitive biases are detectable by comparing the judgments people make when they are inside a given situation to the judgments they make when assessing the same situation from outside.

Self-serving bias is the tendency to attribute our success and triumph to our own skills and talents, and our failures to situational factors or to the actions (or inactions) of others.

As a humorous example, self-serving bias is probably the reason why all the children in Lake Wobegon are above average.

Here are examples illustrating how self-serving bias affects organizational decision-making.

Lessons learned exercises
In lessons-learned or after-action exercises, teams are subject to self-serving bias, and its related group form, group-serving bias. These biases create a tendency to attribute to external factors anything that went wrong, while attributing to the team's own deeds and abilities anything that went right.
Risk plans
To some extent, Bureaucratic controls tend to
control the managed more
effectively than they
control managers
acknowledging risk entails acknowledging vulnerability. Self-serving bias makes us more likely to acknowledge risks related to external situational factors than we are to acknowledge risks arising from our own shortcomings, our team's shortcomings, or shortcomings in our plans.
Security systems
Because self-serving bias can make us reluctant to acknowledge internal security threats, systems tend to be better defended against external threats than they are against threats from within.
Bureaucratic controls
Since bureaucratic controls are designed to meet the goals of management, self-serving bias leads to emphasis on employees who are managed, rather than the managers themselves. Bureaucratic controls tend to control the managed more effectively than they control managers.
Performance bonuses and layoffs
When bonuses are distributed in outsized proportions to those who determine the distribution pattern, many see this as a manifestation of simple greed. But self-serving bias almost certainly plays a role, because it tends to make those who determine the distribution pattern attribute more of the organization's success to themselves than to others. Conversely, when layoffs and cost reductions hit harder those people of the organization most removed from decision-making, self-serving bias probably plays a role as well.
In negotiations, self-serving bias creates risk of impasse because each party tends to overvalue arguments in its favor, and undervalue arguments in favor of their negotiating partners.

An intervention that can at least temporarily reduce the effects of self-serving bias begins with informing the decision-makers of cognitive biases in general, and specifically self-serving bias. Second, the decision-makers are directed to compile lists of contra-biasing insights — ways in which their own performance has contributed or could contribute to depressed performance, and ways in which the performance of others has contributed or could contribute to enhanced performance. It might be a good idea for all of us to meditate on that now and then. Go to top Top  Next issue: Kinds of Organizational Authority: the Formal  Next Issue

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Read more about self-serving bias at Wikipedia.

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People who behave narcissistically tend to regard themselves as special. They systematically place their own interests and welfare ahead of anyone or anything else. In this part of the series we consider how this claimed specialness affects the organization and its people. Available here and by RSS on March 21.
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