What the PMBOK Doesn’t Teach You: How Cognitive Science Can Improve Your Practice of Project Management

Abysmal Estimates

App Notif Return Auto-pop Other Wrong 2 @ 1 Fringe Yr. X of Y0

5

10

15

20

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30

DroppedActual4th Est3rd Est2nd Est1st Est

Re-iterative projectionsfor task completionfor a simple project

Daniel Kahneman

In 2002, Kahneman received the Nobel Memorial Prize in Economics, despite being a research psychologist, for his work in Prospect theory. In 2011, he made the Bloomberg 50 most influential people in global finance. Currently a senior scholar and faculty member emeritus at Princeton University's Department of Psychology and Woodrow Wilson School of Public and International Affairs.

Judgment and Decision-Making Curriculum

Team Member Estimates

TM 1 TM 2 TM 3 TM 4 TM 5 TM 6 TM 70

0.5

1

1.5

2

2.5

3

Years Remaining

Historical Data

PJT 1 PJT 2 PJT 3 PJT 4 PJT 5 PJT 6 PJT 70

2

4

6

8

10

12

ActualEst.

(3 didn’t finish)

Three Lessons:

1. There are two profoundly different approaches to forecasting - the inside view and the outside view.

2. Estimates can fall prey to a variety of planning fallacies – in this case, a best-case scenario rather than a realistic assessment.

3. “Irrational perseverance”: the folly displayed in failing to abandon the project. When confronted with reality, “we gave up rationality rather than give up on the enterprise.”

Prevarication

ProcrastinationPrognostication

Three Topics

PREVARICATION: YOUR BRAIN IS LYING TO YOU

Three Topics

PREVARICATION: YOUR BRAIN IS LYING TO YOUPROCRASTINATION: BASICALLY A LAZY HUNK OF MEAT

Three Topics

PREVARICATION: YOUR BRAIN IS LYING TO YOUPROCRASTINATION: BASICALLY A LAZY HUNK OF MEATPROGNOSTICATION: BEST LEFT TO THE ALGORITHMS

Three Topics

THIS IS YOUR BRAINChapter II

What the brain does well• Fight or Flight Decisions• Cross Modal Synaesthetic Abstraction

What the brain does too well• Pattern recognition• Heuristics (A machine for jumping to conclusions)

What the brain does not do well at all• Multi-tasking• Statistics

Cross Modal Synaesthetic Abstraction

Vilayanur Subramanian “Rama” Ramachandran,neuro-scientist, tells his audience that these are Martian alphabets and asks them which one they think is called kiki and which one booba. 98% of the audience point out the smooth shape as Booba and the sharp one as Kiki.

Two Systems, Fast and SlowSystem 1 System 2

Answer to 2 + 2 = ? Focus attention

Detect that one object is closer than another

Compare two items for overall value

Detect hostility in a voice Check the validity of a complex logical argument

Orient to sudden loud sound Solve a math problem

Read words on large billboards Tell someone your phone number

Drive a car on an empty road Pick one voice out of a noisy room

Automatic, subconscious Costly

Intuitive, heuristic Thinks its in charge

PREVARICATIONChapter V

Müller-Lyer Illusion

Müller-Lyer Illusion

A bat and ball cost $1.10.The bat costs one dollar more than the ball.How much does the ball cost?

$.10 + $1.10 ≠ $1.10

PROCRASTINATIONChapter VI

Good resolutions are useless attempts to interfere with scientific laws. Their origin is pure vanity. Their result is absolutely nil. -Oscar Wilde

Procrastination

Class A: All papers due on last day of class

Class B: Students allowed to set deadlines

Class C: Papers due at regular intervals

Ariely & Wertenbroch, 2002

People have self-control problems, they recognize them, and they try to control them by self-imposing costly deadlines. These deadlines help people control procrastination, but they are not as effective as some externally imposed deadlines in improving task performance.

PROGNOSTICATIONChapter VII

Prognostication

Hofstadter's Law: It always takes longer than you expect, even when you take into account Hofstadter's Law.— Douglas Hofstadter, Gödel, Escher, Bach: An Eternal Golden Braid

Areas of Expertise

How Expectations Mess Up Project Estimates

• control – no explicit anchoringmean – 8.3 median – 7 standard deviation – 4.4 • ‘2 months’ conditionmean – 6.8 months median – 6 months standard deviation – 3.7 • ‘20 month’ conditionmean – 17.4 median – 16 standard deviation – 5.6

Planning Fallacy

• The tendency to underestimate how long it will take to complete a task, the costs, and the risks involved, while simultaneously overestimating the benefits

Planning Fallacy

• Self-serving bias: taking credit for when things went to schedule, while blaming delays on outside influences

• Discounting multiple high impact (though individually unlikely) risks

• Underestimating Overhead: failure to take into consideration vacations, illness, staff changes, meetings

• Insufficient consideration of distributional information about outcomes

TE = (O + 4M + P) ÷ 6

Expected time (TE )Optimistic Time (O)Most likely Time (M)Pessimistic Time (P)

SUGGESTIONSChapter IX

Algorithms

Regress your prediction

1. Determine the baseline2. Come up with your intuitive prediction that

matches your impression of the evidence3. Estimate the correlation between the

evidence & 4. If the correlation is .30, move 30% of the

distance from the average toward your prediction

Reference-Class Forecasting

CONCLUSIONSChapter X

• Repeated patterns of events • Feedback between a decision and it’s outcome• The ability to link decisions to their outcomes • Time to reflect on those outcomes

Thinking, Fast and Slowby Daniel Kahneman

Predictably Irrational, Revised and Expanded Edition: The Hidden Forces That Shape Our Decisions by Dan Ariely

Models.Behaving. Badly: Why Confusing Illusion with Reality Can Lead to Disaster, on Wall Street and in Life by Emanuel Derman

The Black Swan: Second Edition: The Impact of the Highly Improbable: With a new section: "On Robustness and Fragility“ by Nassim Nicholas Taleb

You Are Not So Smart: Why You Have Too Many Friends on Facebook, Why Your Memory Is Mostly Fiction, and 46 Other Ways You're Deluding Yourself by David McRaney

Committee on Military and Intelligence Methodology for Emergent Neurophysiological and Cognitive/Neural Research in the Next Two Decades: Emerging Cognitive Neuroscience and Related Technologies

Cognitive Bias RapI want to talk to you all about cognitive neuroscienceon your brain you can't hang too much relianceit lies, ignores, forgets and cheatsit's nothing but a lazy hunk of meat

A neuron is a cell in your headout from which the dendrites spreadlike the branches of a treebut instead of roots its got an axon or threethrough which flows electricitywhat happens next is anybody's guessits a big old neuropsychopharmacological mess

Now, don't get pissed and act all pious -everyone's got some cognitive biasyou might have heard about the halo effectif someone's good at cooking you think they're also good at sex

or when the echo chamber repeats the same tire tiradeuntil false becomes truth, that's the availability cascade,if you make a pattern out of the blooming confusionthat's not really there, that's the clustering illusion

Because your brain's not good at data conversion,there's a little thing called "loss aversion"which means you over-value what you already haveand won't trade it for something that's half as bad

People think that they know youbut you don't know them the same way tooYou can see that that's not right -- it's the illusion of asymmetric insight

& one that I think is particularly ominousgoes by the name of “The Just World Hypothesis”or, “people get what they deserve”to believe that takes a lot of nerve& ignores the supreme importance of luck(says the guy who was killed by a pick-up truck)

The mind's not bound to reality but to frameschange the frame and change the gamekeep an eye on your mind & the tricks it likes to play& don't think it's real, all the things it has to say