How we have far too much confidence explaining what just happened, but have

Product & Experience

All too often, we find ourselves unable to predict what will happen; yet after the fact we explain what did happen with a great deal of confidence. This “ability” to explain that which we cannot predict, even in the absence of any additional information, represents an important, though subtle, flaw in our reasoning. It leads us to believe that there is a less uncertain world than there actually is, and that we are less bright than we actually might be. For if we can explain tomorrow what we cannot predict today, without any added information except the knowledge of the actual outcome, then this outcome must have been determined in advance and we should have been able to predict it. The fact we couldn’t is taken as an indication of our limited intelligence rather than of the uncertainty that is in the world.

By teatime, everyone can explain the market move nobody predicted at breakfast. Outcome knowledge is a marvellous script editor.

The successful campaign acquires a perfect chain of brave creative choices. The failed hire’s ambiguous interview answer becomes an obvious warning. A product launch lands well and the accidental timing is promoted to strategy. Other endings disappear, leaving the one that happened looking as though it marched there under orders. This is how sensible bets get punished for losing and reckless ones become best practice after winning. Explanation matters, but coherence is not proof that an event was foreseeable. Stories are generous with causation once surprise has supplied the final scene.

Keep a decision record while the future can still embarrass it: forecast, alternatives, assumptions, confidence and evidence that would change the choice. During review, separate what was knowable then from what the result donated later. Ask whether the process was sound across the plausible outcomes, not merely whether this outcome smiled. List the futures that nearly happened but did not. Memory cannot preserve uncertainty after the answer without help. A short decision log can. Otherwise the organisation learns an elegant lesson from every event and almost none of them are true.