Project Management in Light of Cognitive Biases: A Public Sector IT Organization Case

When making judgments, people rely on heuristics, or general rules of thumb. In other words, they use mental "shortcuts", which may lead to rational solutions and good estimates. In certain situations, however, these simplification techniques can cause inconsistencies and promote cognitive biases. One root cause of almost all project failures is human error or misjudgment. Although the ability to make right decisions is considered a main indicator of project management professionalism, many project managers are unwilling to try to improve the quality of their decisions. Because project managers rarely have enough time and resources to perform a proper analysis, and a decision analysis expert is not always available, there is always the temptation to make intuitive decisions. Even having enough knowledge of a particular area, some natural limitations to thinking mechanisms can lead to potentially harmful choices. Since people tend to rate themselves as above average when asked to characterize their abilities, they tend not to see their own biases. This paper proposes to shed light on the susceptibility of project managers to cognitive biases and how they deal with them, including techniques and tools they use to minimize their negative effects. This study evaluates ten cognitive biases: anchoring bias, exposure effect, pseudocertainty effect, certainty effect, hindsight bias, halo effect, planning fallacy, sunk-cost fallacy, availability-related bias, and Parkinson´s law effect. The qualitative approach was based on semi-structured interviews with seven experienced project managers in a Brazilian large public sector IT organization. Other three project managers participated in the triangulation process in order to validate the concepts map resulted from this process. All project managers recognized susceptibility in eight of ten cognitive biases. Some agile practices such as use of burndown chart for daily monitoring of planned versus accomplished activities and bottom-up planning from short activities were suggested as alternatives to minimize planning fallacy. The last technique was also indicated to minimize Parkinson´s law effects along with daily team meetings. Opinion of others, including experts, was the most mentioned alternative method by project managers, aiming to reduce the negative impact of seven biases. Although its limitations, we believe that this work may help to improve project managers' awareness of cognitive biases and also their susceptibility to these systematic errors, eliciting common tools and techniques used to minimize their negative effects, which can lead to better decisions, and thus, to better project´s outcomes.info:eu-repo/semantics/publishedVersio