I am big fan of Malcolm Gladwell’s work, as is my daughter Hannah, and a number of people in my MA class, so we went down to see him speak at the Brighton Dome on Tuesday night.
MG decided to talk about ‘overconfidence’ instead of taking any extracts from his existing books – which was very interesting and rather refreshing.
So what did he say? As usual Malcolm Gladwell showed himself to be the master of the ‘engaging narrative’. I know of no other speaker with his talent, not as a master public speaker as such, but as a weaver of new complex observations, applied research and historical perspectives.
Gladwell described research, now about 50 years old, where a clinical psychologist gathered a large group of other psychologists and asked them 20 or so questions on a case. The psychologists were asked to answer the same questions a further 4 times, with additional case information being added between each set. The percentage of correct answers did not increase as the information increased, in fact they mostly stayed around the 29-30% mark.
In addition to asking the participants to answer the questions, they were asked to estimate their correct answers for each set. In this instance the estimates for accuracy kept increasing as their information increased… in some instances they estimated that they had answered 90% of the questions correctly – while in reality they had only answered about 30% correctly.
Gladwell describes this as being ‘over-calibrated’ – where our confidence is massively increased with the volume of information – which actually diverts us from actually thinking clearly. Often more information confuses us rather than informs us. To support this thinking Gladwell relates this to two stories – one from the US Civil War and the other to the stock market crash.
His main example of overconfidence was the behaviour of the CEO of Bearn Stearns, James Cayne, as the company reached crisis point. Instead of taking any action Cayne went to a 10 day bridge tournament where phones were not permitted. This story is well known in financial markets.
The Civil War example described the overconfident behaviour of Union Commander Joseph Hooker at the battle of Chancellorsville. The Confederate Commander, Robert Lee, surrounded Hooker’s men and defeated them despite being at a great troop disadvantage (2:1), and Hooker having advanced information gathering systems. The overconfidence took the form of delaying action in favour of meals – although I suspect this detail was included in part for amusement. Robert Lee went on to loose his next battle due to overconfidence of his own.
In closing his story and arguments Gladwell observed that society encouraged over-calibration by elevating the over-confident, almost requiring this false sense of authority, in leaders especially, and said that what we should be encouraging our experts to cultivate and demonstrate humility instead.