An innovative person is one who introduces new ideas, via original and creative thinking. Product innovation is the process of bringing or using new ideas or methods for the benefit of a product’s or service’s feature-set. All product innovation is made possible by innovative people using the immense power of human imagination.

Decision-making and distortion fields

Despite the allure of innovation, for mature enterprises, the transformation required to realize the benefits of innovation requires aggressive knowledge, and understanding, of the decision-making process.

In 1989, a paper was published looking at the ways people contort (or distort) the impression of their immediate circumstances to fit their preexisting worldviews. Steve Jobs, one of the most transformative and innovative leaders of our generation, was famous for what became known as his “reality distortion field.”

The study, titled “Expert Decision Making in Evolving Situations,” provided 11 groups of Army intelligence analysts with a realistic battlefield scenario and asked them to assess the most likely avenue for an enemy attack. The scenarios were similar, with slight variations to produce different answers. In addition to predicting an outcome, each group was expected to share their level of confidence in their predictions.

The investigators then provided each team with updated intelligence reports and asked them to reconsider their assessments. Some reports contained items confirming initial judgments while others were designed to encourage skepticism. The majority were neutral, and the process was repeated two more times.

It was the hypothesis of the investigators the level of confidence should have stayed, in the aggregate, roughly the same. The researchers found the groups grew more convinced with their initial judgements as more information was received. Only 1 of the 11 teams changed its assessment of how the enemy would attack while 7 of the 11 teams expressed greater confidence in their prediction over time.

Through interviews, the investigators found the teams gave significantly more weight to information that reinforced their earlier decisions. When presented with contradictory information, the groups were dismissive or downplayed its significance. This phenomenon is known as “confirmation bias.” The researchers chose Army intelligence teams because they had been trained not to fall victim to the perils of confirmation bias, yet they were now exhibiting it.

The researchers concluded:

“The results of this experiment lend support to the general conclusion that trained subjects in an evolving, realistic, decision environment demonstrate performance characteristics similar to those of novices working with less realistic and relatively more static scenarios. Specifically, confidence in an initial hypothesis is generally high, regardless of the hypothesis.”

Analysis Paralysis is the enemy of transformative decision-making

In today’s climate of rapid change, transformation within mature enterprises is top of mind. No enterprise wants to get “Uberized.” While the status quo is difficult to change, transformative progress requires decisive decision-making. The study above clearly articulates both the challenge of confirmation bias and the power of 1st impressions. To be transformative, leaders need to avoid the pitfall of confirmation bias, while not falling victim to the scourge of analysis paralysis.

About the author:

Tal Golan (@TalGolan) is the Chief Strategy Officer at VERB.