We’ve got another psychological decision making trap for today. This is number 5 out of the 8 we will cover. It’s simply referred to as over-confidence.
Over confidence makes us overestimate the accuracy of our forecasts.
Illustration: You just started a fitness routine and you dropped 3 lbs in 3 days. That means if you keep this up for 15 days then you’ll lose 15 lbs. Over confidence.
Work Illustration – The first 10 days of your sales month has been really strong. Forecasting to an all-time high for the month. You’re confident your forecast is accurate so you get distracted and divert your attention elsewhere. It’s easy to do, and I say that from personal experience.
Best practice to temper over confidence? As my dad always says: not too high, not too low. Just keep plugging away. Extend the scope of the data you reviewed.. lets not just look at July. Let’s look at the whole quarter. Let’s not look at last year’s sales, but let’s look at the average of the last 3 years..
The best medicine for overconfidence, is a steady dose of humility and hard work ethic. Doesn’t hurt to have a seasoned veteran in the office to help keep everyone grounded. Let’s focus on today and take care of what needs to be done, today. Tomorrow will come soon enough.
