Too much optimism leads to bad planning, bad risks, bad business choices. Too little optimism leads to lower levels of physical and mental health, less resilience, less persistence in the face of obstacles, and an unwillingness to take appropriate risks.
Who needs optimism? Salespeople. Scientists engaging in research. Entrepreneurs. Inventors. Leaders. You?
So what’s right-sized optimism?
According to Daniel Kahneman in the book Thinking, Fast and Slow, mild optimism serves us well. We should be optimistic primarily in areas where we have some control. Optimism belongs in implementation, where resilience in the face of failure often differentiates success. Mild optimism belongs in our self-image, he says, where it contributes to our influence, our persistence, and our ability to inspire.
Optimism belongs less in decision making where it leads us to be too confident of things over which we have no control – the direction of the stock market or our competitors behavior, for example. Here’s where it causes leaders to over-estimate the chances of success. Kahneman provides powerful examples of what he calls the “planning fallacy” where we plan based on best case scenario, which is highly unlikely, and “sunk-cost fallacy” where we through good money after bad because we don’t want to lose what we’ve already invested by admitting failure.
He quotes some powerful statistics we optimists often ignore at our peril. For example, there is only a 35% chance that a small business will survive for five years in the US. But most entrepreneurs estimate their chances of success at 70%, almost double the value, and a full 33% said they had zero chance of failing. We overestimate how we do compared to others quite frequently, as shown in the well-established research that 90% of drivers think they are better than others. HA! Just drive in Boston to disprove that one. Of course, that only applies to others. Me – I’m much better than most drivers.
Clearly, I still like optimism, and find it useful particularly in relation to people. I like thinking the best of others – assuming they’re doing the best they can. It helps me be less judgmental and look for reasons why they do what they do if it doesn’t suit me, rather than just get angry.
I like the kind of optimism in Ben and Roz Zander’s Art of Possibility. There’s the chapter on Giving Yourself an A, where they write of Ben wanting to inspire his music students. At the beginning of the semester he gave everyone an A and then asked them to explain how they will have earned it. “The freely granted A lifts you off the success/failure ladder and spirits you away from the world of measurement into the universe of possibility. It is a framework that allows you to see all of who you are and be all of who you are, without having to resist or deny any part of yourself.” Doesn’t that empower just to read it?
Then they write of Rule Number 6 (the only rule) which is don’t take yourself so g-damn seriously. Maybe we need optimism to do this. We stop worrying quite so much about what’s wrong and wonder what might be right, or whether it even matters.
I can’t leave out the chapter on Leading from Any Chair in a discussion of optimism. The premise is that all who you lead should be able to shine, and if not, what are you missing. Everyone can be a leader and make a contribution from wherever they sit in the orchestra (or your company.) But you have to be optimistic and assume they can. In the words of the Zanders “How much greatness are we willing to grant people? Because it makes all the difference at every level who it is we decide we are leading.”
So the moral of the story is to right size your optimism according to task. Contain your optimism carefully and pay more attention to all available data when you are making decisions. Expand your optimism when it empowers you and others to accomplish more.
Just for today, take a minute to give yourself an A. Then think, “What would I have to have done by the end of this day to have earned it?” You have control over making that happen. Be optimistic.