Aberdeen Angus im Gadental an den Steilhängen des Muttawangjoch oder auch Mutterwangjoch genannt. Im Hintegrund die Südflanke des Feuerstein 2271m. (c) Böhringer Friedrich (CC BY-SA 3.0 AT)

Optimists Get Better At Predicting Performance Over Time

E. Forrest Christian Reviews - Articles 2 Comments

The old research has been pretty consistent: optimists are lousy at predicting what will really happen because they always assume “happy day”. But no one has ever seen how optimists predictions change as they get more information.

Until now.

A recent study (currently a working paper) tracked MBA students performance predictions across semesters. It turned out that the students more who had more optimistic projections in the beginning (and were wrong) got much more accurate over time as they got more information and feedback. Pessimists, oddly, got less accurate as the semester progressed. Apparently having the initial optimism about success (when they have no data) doesn’t color their ability to make more accurate evaluations as they get more data.

However, we all know stories about business leaders who kept on thinking that things were going to go their way when they clearly weren’t. There is probably a nuance that needs to be addressed here that is being missed by everyone.

I’d also be interested in how level of capacity affects these findings. Were the “pessimists” simply working at the wrong level? I think MBA work, even at Duke, is level 2 or less.

Read the whole working paper:

Ron Kaniel, Cade Massey & David T. Robinson. 20087/8. “Optimism without illusion: The impact of experience on expectations“. Yale Working Papers.

Image Credit: “Aberdeen Angus im Gadental an den Steilhängen des Muttawangjoch oder auch Mutterwangjoch genannt. Im Hintegrund die Südflanke des Feuerstein 2271m.” © 2013 Böhringer Friedrich (CC BY-SA 3.0 AT). Via Wikimedia Commons.

About the Author

Forrest Christian

Twitter Google+

E. Forrest Christian is a consultant, coach, author, trainer and speaker at The Manasclerk Company who helps managers and experts find insight and solutions to what seem like insolvable problems. Cited for his "unique ability and insight" by his clients, Forrest has worked with people from almost every background, from artists to programmers to executives to global consultants. Forrest lives and works plain view of North Carolina's Mount Baker.  [contact]

Comments 2

  1. Interesting article– I look forward to reading it.

    Regarding “business leaders who kept on thinking that things were going to go their way when they clearly weren’t”, I’d begin looking for that nuance in research done on gambling addiction. I’m no expert on that, so I don’t know, but it’s where I would start.

  2. Post
    Author

    Excellent thought, Alicia. There is an extensive literature on risk and gambling. And the casinos have done even more research on how to get people to continue to put money into something that isn’t going to pay off.

Tell Forrest how wrong he is: