Biases & Fallacies

Quality, Consequences and the Construction Industrial Complex (part 320).

Do we need therapy to move past our biases and fallacies?

I am confident (see overconfidence bias below) that any therapist analyzing the construction industry and the people that work within it, would conclude we:

  1. Suffer from multiple bias’s and fallacies.
  2. Participate in multiple abusive relationships.
  3. Work in an industry that has insolvency as a business model (see item 2 above). When the average net profit in the UK construction sector is between 0.5 and 1.0% this is a fair observation.

I saw a list of project management fallacies and biases in the Prof Bent Flyvbjerg article “Top Ten Behavioral Biases in Project Management: An Overview” (2021 Project Management Journal).

I could not stop thinking of times I had experienced all these on past projects and how building commissioning is impacted. Here is my amended list with the building commissioning context added.

Project Management Bias Description Building Commissioning Bias
1 -Strategic Misrepresentation Tendency to deliberately and systematically distort or misstate information for strategic purposes.

AKA: political bias, strategic bias or power bias.

 Present in RFP’s and horrific i.e. most of them, commissioning specifications.
2 – Optimism Bias Tendency to be overly optimistic about the outcome of planned actions. Includes overestimation of positive events and underestimation and frequency of negative events.

 

 See every commissioning schedule (programme for Brit’s) ever published.
3 – Uniqueness Bias Tendency to see one’s project as more unique that it actually is.

Always run away when you hear, “this job is different”. It is not!
4 – Planning Fallacy  Tendency to underestimate costs, schedule and risks plus overestimate benefits and opportunities.

 

Every commissioning job I have ever worked on.

 
5 – Overconfidence Bias Tendency to have excessive confidence in one’s own answers to questions.

 

 I am guilty as charged.
6 – Hindsight Bias Tendency to see past events as being predictable at the time they happened.

Also known as “I knew it all along”.

Commissioning can be characterized as “retrospective engineering”. I am guilty as charged.
7 – Availability Bias Tendency to overestimate the likelihood of recent events.

 

 This is why, when you do a poor job you are “over”, in the eyes of the client.
8 – Base Rate Fallacy Tendency to ignore generic base rate information and focus on specific, small sample information.

 

 Results in little attention to past lessons learned.
9 – Anchoring Tendency to rely heavily on one trait or piece of information when making decisions, typically the first piece of information acquired.

 

Costs Vs Value. Construction anchors to lowest cost wins not necessarily best value, which is hard to forecast.

10 – Escalation of Commitment

AKA

Sunk Cost Fallacy

 Tendency to justify increased spending and commitment based on cumulative sunk (past) costs and time. This is done despite new evidence suggesting carrying on is wrong. Driven by personal pride and “face”.
  • Commissioning and optimizing a poorly design building system. Sometimes they just do not work!
  • Performance managing a poor contractor.
  • Not firing poor performers.
  • Carrying on in a job you actually hate.

I recognized myself in most of the above, so there is work to do on my part. If I had to pick 3 to really work on, I will focus on:

  1. Overconfidence Bias – be more reflective and humble. This will be hard for me!
  2. Anchoring – become more aware of personal anchoring
  3. Sunk Cost Fallacy – know when to pull the plug and not waste time and resources.

Thinking about Cobb’s Paradox – “We know why projects fail; we know how to prevent their failure – so why do they still fail? (Martin Cobb, 1995)

To answer Martin Cobb, IMHO, humans do not like change. That’s it. Projects fail because of human choices, group think, biases, fallacies, socialised risk and low personal consequences. I guess we all need to reflect and challenge our thinking.

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