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Performance Management

The Psychology of Making Bad Decisions at Work

August 27, 2015
5 min read
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Performance Management, Supercharged



Employees make mistakes all the time. Whether it’s a failure to document something, CCing the wrong person in an email thread, or any of the several other legal mistakes that can cost your company; employees always seem to be between one mistake and the next. But how do these mistakes happen? Why does it feel like people are making more mistakes on a regular basis nowadays? What do you do about these mistakes? As it turns out, there are answers to all of these questions, and it's often about how you look at the problem.

Haste Makes Waste

Many of the decisions we make don’t take too long. For example, most purchasing decisions are made in about 2.5 seconds. We see the Snickers bar at the checkout line and we purchase it. Only after we’ve imbibed its delicious chocolate and nougat do we realize it probably wasn’t a great idea. So we’re used to not having to think about our decisions so much.

But at work, we tend to encounter bigger problems than at the store. As Dr. Tomas Chamorro (@drtcp), CEO of Hogan Assessments explains, these tougher decisions tend to make us think in strange ways. 

"When we are faced with problems that are difficult or have an ambiguous solution, our brains purposefully substitute an easier question in order to come up with an answer. The answer we come up with may not be optimal, but for most situations – choosing, for instance, what we eat for breakfast – it will be good enough. After all, the consequences of choosing a bowl Frosted Flakes over Fiber One are relatively small. The problem is, at work, people have to rapidly respond to dozens of difficult, ambiguous problems every day." 


CC-Click-ToTweetBird-01 In our haste to turn complicated problems into simple ones, we make mistakes.

More Avenues For Bad Ideas

With the advent of the internet, modern telecommuting technology and other various complications of the workplace, employees have more avenues than ever for ambiguous decisions (and the bad decisions that sometime come with them) to spring up. Before they even have the job, potential employees are posting inappropriate content on their social media networks, and 51% have reconsidered hiring someone based on this inappropriate content. 

It's not just employees who have problems with this abundance of options; according to a recent survey, more than half of all IT workers in the United States have access to employee networks and other company information even after they no longer work there. Therefore, we may conclude because technology has more capabilities, there’s more room for error.

CC-Click-ToTweetBird-01 Sometimes mistakes lead to better ideas for preventing future, bigger problems.


What to Do About Mistakes

Mistakes are relative. Sure, spilling coffee on the office kitchen counter is probably a bad idea no matter which way you're looking at it, but not all problems are so cut-and-dry. Sometimes a mistake leads to better ideas about how to prevent future, bigger problems. Often, making mistakes is a result of taking risks. And sometimes, those risks are necessary for businesses to grow. As Amy Rees Anderson (@amyreesanderson), Managing Partner of REES Capital notes, finding the right place to have employees make mistakes can be a legitimate business strategy. 

"I quickly discovered that the first step was to determine the areas of the business where a mistake could take place without causing too much damage. I took careful attention to make sure that any areas where we would damage our clients and the trust they had placed in us were off limits for significant risk without serious executive involvement and oversight. I identified other areas where I could feel more comfortable allowing people the freedom to experiment on new and better ways of doing things." 

Mistakes will happen in the workplace no matter what you do. To err is human, after all. But the important thing for any business to learn isn't how to avoid mistakes, it's how to learn from them. People will make mistakes using every avenue that's open to them, and that's both a good and a bad aspect of humanity. Learn how to find out where mistakes are unacceptable and when they can be good for business, and you'll find the key to running a more effective business. 

Want to train your employees in the right, low-stakes environment? Then try out ClearCompany's performance management software. Sign up for a demo today and we'll show you just how much better your employees could perform on a daily basis!

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