Why? Why? Why does my brain lie to me?!

Bias and noise.

We like to think we’re rational operators. Decades of behavioural research – Kahneman, Sibony, Sunstein – tell us otherwise. We anchor on the first fact we hear – anchoring bias. We seek evidence that backs up our beliefs – confirmation bias. And our mood? Don’t get me started. Hungry, tired, or just coming off a tough week? They all create noisy decisions, inconsistent ones.

Take the case of a parole board. Research shows decisions are harsher just before lunch. And that judges set harsher sentences if sentencing on a Monday morning after their sporting team lost on the weekend!!! 😳

Bias we can train for. Noise is trickier – it’s randomness in our decisions that we’re often blind to. And it costs us money, reputation, and time.

What’s the fix? Build systems that reduce variability. Use risk scoring tools, checklists, and decision trees. Schedule decision-making when you’re alert, not when you’re frazzled. Create feedback loops that spot inconsistencies before they spiral.

For C-suite leaders: Be aware of the hidden factors influencing your decisions – mood, fatigue, and context. Create an environment where challenging assumptions is welcomed, and slow down critical decisions to ensure quality over speed. Model calm, deliberate decision-making from the top.

For risk professionals: Look for when cognitive biases and noise are distorting decisions and develop your radar for detecting them. Look for patterns and educate decision makers on these pitfalls. Develop frameworks and tools that add structure and consistency to decision making across the organisation.