MANAGING RECENCY BIAS IN LEADERSHIP

 A more thoughtful evaluation is a mix of both recent developments and long-term performance, argues LINUS OKORIE

Leadership is a complex and challenging endeavor, influenced by human behavior, team dynamics, organizational culture, and the external environment. Effective leaders must handle obstacles like conflict resolution, resource allocation, and strategic planning, all while keeping morale high and fostering a sense of purpose within their teams. A crucial part of this is making good decisions, which are key to the success and fairness of an organization.

One cognitive bias that can impact decision-making is recency bias. This bias leads people to give too much weight to the most recent information or events, often overlooking a fuller evaluation. Leaders need to be aware of this bias because it can distort their judgment and affect their ability to make well-rounded decisions. By recognizing recency bias, leaders can aim for a more balanced view, ensuring their strategies respond not only to recent changes but also align with long-term goals and past lessons.

Recency bias is a type of cognitive bias where people make conclusions based on recent events. They frequently lead people to make emotional decisions based on recent or short-term outcomes, neglecting the rational aspects of the situation and what happened in the past. In simple words, recency bias means placing undue importance on the latest information when making decisions or forming opinions. This can skew judgments and affect our quality of decisions. It’s easy for individuals to believe that recent events will determine how the future unfolds. This behavioral bias stems from how humans rely on short-term memory to make sense of the world in real-time.

For example, there are cases where employees and team members are judged by their leaders based on their latest achievements or shortcomings in performance rather than their overall contributions. In short, this establishes that emotions, for better or worse, are the primary triggers in major life decisions and that human memory and intuition are susceptible to errors. This blog explores the concept of recency bias, its implications as leaders, and strategies to mitigate its effects.

In a workplace setting, recency bias can manifest during performance reviews. For instance, if an employee recently completed a high-profile project successfully, a manager might rate them more favorably than a colleague who has consistently performed well but hasn’t had any standout achievements recently. This could lead to an unfair evaluation that doesn’t accurately reflect the employees’ overall performance.

Recency bias can also cause issues beyond individual performance: it can lead to problems in team dynamics, with newer members being favored or compensated over those who have been around longer. This can result in a lack of trust and collaboration among team members, leading to decreased motivation and productivity.

Daniel Kahneman, a Nobel Prize-winning psychologist found that most human decisions are not based on facts or logic. Instead, they are based on biases, beliefs, and intuition. For leaders, it is critical to become aware of these—and challenge them constantly. It is nearly impossible to avoid recency bias completely because it is hardwired in humans to act on feelings generated by closer and clearer events. However, we can save ourselves from making bad decisions due to recency bias, especially in leading people, by taking these simple measures.

One, Keep detailed records. A detailed record-keeping system gives leaders something to refer to when they are dealing with their team members. These records should include both positive and negative feedback from other employees, from managers, and even from customers. This provides a holistic view of each team member’s performance.

Other records that you might want to keep include things like details of targets and key performance indicators (KPIs), milestones, any training that has been completed, and any other details about their employment and performance. This comprehensive approach promotes fair and balanced evaluations that contribute to a more productive organizational environment.

 Two, Use a performance review system. Keeping all performance records on paper can become unmanageable, especially when dealing with a large number of employees. To address this, utilizing a Human Resource Information System (HRIS) can greatly simplify the process. During performance reviews, the HRIS allows managers to efficiently retrieve and review an employee’s complete history, ensuring a thorough and fair evaluation. Additionally, the HRIS can record details about performance reviews, track changes in personal information, and store other critical data such as attendance and disciplinary records.

By having a comprehensive digital repository, leaders can mitigate the challenges of paper-based systems, reducing the risk of lost or misplaced documents and ensuring that all information is up-to-date and accurate. This streamlined approach not only aids in avoiding recency bias by providing a full overview of each employee’s performance but also enhances the overall efficiency and effectiveness of the performance review process.

Three, Evaluate performance based on goals. Evaluating performance based on goals transforms subjective reviews into objective assessments by leveraging quantifiable data. Goals and Key Performance Indicators (KPIs) provide clear targets and metrics, making it easier to measure an employee’s performance against defined standards. With specific targets to achieve, the review process becomes grounded in objective data that highlights whether an employee is meeting expectations, exceeding them, or falling short. This objective framework allows for a more precise evaluation, showcasing areas of excellence and pinpointing underperformance.

When employees surpass their goals, it is evident through measurable results, which can be celebrated and used to motivate further achievement. Conversely, when goals are not met, the data provides a clear indication of where improvements are needed. This enables targeted interventions, such as additional training, resource allocation, or reassessment of goals to better align with the employee’s strengths and the organization’s needs. By focusing on goals and KPIs, performance reviews become more transparent, fair, and actionable.

Four, Conduct regular check-ins. Conducting regular check-ins is essential for maintaining a continuous performance management process. While annual performance reviews cover a 12-month period, it’s crucial to engage in quarterly or even monthly updates to ensure ongoing progress and address issues promptly. These regular meetings provide opportunities to set and adjust goals, ensuring they remain relevant and attainable. By frequently reviewing performance, leaders can identify and address short-term issues before they escalate into more significant problems.

This proactive approach helps to keep employees aligned with organizational objectives, fostering a sense of accountability and engagement. They also provide a platform for recognizing achievements and motivating employees, reinforcing positive behaviors and contributions. With performance being monitored and guided consistently, it leads to better outcomes for both the employees and the organization.

Five, Take time to reflect. Taking time to reflect is crucial for overcoming recency bias and avoiding hasty, gut-reaction decisions that can undermine effective leadership and employee relationships. By pausing to reflect, leaders can ensure their decisions are fair, balanced, and unbiased. This reflection period allows for a more thoughtful evaluation of all available information, considering both recent developments and long-term performance. It helps in recognizing patterns, understanding context, and making more informed decisions.

This mindful approach is essential for building successful working relationships with employees, as it demonstrates a commitment to fairness and objectivity. Taking the time to reflect not only improves decision-making but also fosters trust and respect within the team, as employees feel their contributions are evaluated impartially.

 Okorie MFR is a leadership development expert spanning 30 years in the research, teaching and coaching of leadership in Africa and across the world. He is the CEO of the GOTNI Leadership Centre.