The hindrance of hindsight bias


It’s that time of year when we look back at the 2012 predictions we made in 2011, and then make our 2013 predictions. Before I shake the dust off of my Magic 8 Ball and peer into the future with the crystal ball I bought at the Dollar Store, let’s revisit my 2012 prediction.

Was 2012 the Year of the Datechnibus?

At last year’s IDEAS 2011 closing panel discussion, moderated by Jill Dyché, panelists David Loshin, Joyce Norris-Montanari, Rich Murnane, Phil Simon and I were asked to predict trends for 2012.

Just before taking the stage, I recorded this one-minute video predicting that 2012 would become the Year of the Datechnibus — a data-aware, technology-savvy business person who would enable the cross-functional alignment and multi-directional translation of the data, technology and business aspects of enterprise initiatives such as data quality, master data management and data governance.

I predicted that Getting Datechni-Busy With It (I am currently engaged in a patent war with Apple over the trademark of that phrase since apparently Apple patented the alphabet and therefore are claiming ownership of all words and phrases :-) ) would allow organizations to focus on collaboration without labeling the collaborators by either their group’s business function or their individual job description.

At the IDEAS 2012 closing panel discussion next week, moderated by Gavin Day, Rich Murnane, Joyce Norris-Montanari, Phil Simon and I, we will review our 2012 predictions and then make our 2013 predictions. Future blog posts, videos and podcasts will cover those details.

For more information about IDEAS 2012, visit the conference website and follow the conference next week using the Twitter hashtag #dfIDEAS12

Hindsight Bias

I have previously blogged about why most predictions do not come true. In the rest of this post, I want to discuss one of the many reasons why we are so bad at making predictions.

Hindsight bias is a term from psychology for how we cannot suppress the powerful intuition that what makes sense in hindsight today was predictable yesterday, and this illusion that we understand the past fosters overconfidence in our ability to predict the future.

“The core of the illusion,” as Daniel Kahneman explained in his book Thinking, Fast and Slow, “is that we believe we understand the past, which implies that the future also should be knowable. The idea that the future is unpredictable is undermined everyday by the ease with which the past is explained, but in fact we understand the past less than we believe we do.”

In his book Everything Is Obvious: How Common Sense Fails Us, Duncan Watts explained that “we learn less from history than we think we do, and this misperception in turn skews our perception of the future, misleading us into thinking that we know more than we do.”

The hindrance of hindsight bias undermines our mind’s ability to make sense of the past, which often leads us charging into the future armed only with what Kahneman called the illusion of understanding.

The net result is, as Watts explained, although we are good at making sense of the past, we are not necessarily good at understanding the past — which also makes us bad at predicting the future.


About Author

Jim Harris

Blogger-in-Chief at Obsessive-Compulsive Data Quality (OCDQ)

Jim Harris is a recognized data quality thought leader with 25 years of enterprise data management industry experience. Jim is an independent consultant, speaker, and freelance writer. Jim is the Blogger-in-Chief at Obsessive-Compulsive Data Quality, an independent blog offering a vendor-neutral perspective on data quality and its related disciplines, including data governance, master data management, and business intelligence.

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