How Big Things Get Done

I read this book recently, and while its focus is large infrastructure projects – bridges, air terminals, etc. – there are some interesting psychological points related to how we estimate things day to day like how long a project will take or how long a meeting will last.

Optimism Bias

One of the reasons these large scale projects consistently go over time and over budget is that we tend to have an optimism bias, and therefore estimate for the "best case scenario." However, statistically, the best case scenario almost never happens.

"So what does inform the estimate? You generate a mental image of working at home. From this scenario, a sense of how much work you can do on the weekend quickly and intuitively emerges. It feels true, so you go with it. Yet that judgment is very likely wrong. That’s because, in constructing the scenario, you only imagine yourself working. That narrow focus excludes all the people and things around you that could intrude on your work time. In other words, you are imagining a “best-case” scenario. That’s typical. When people are asked to make a “best-guess” scenario—the scenario most likely to occur—what they come up with is generally indistinguishable from what they settle on when asked for a “best-case” scenario."

Uniqueness Bias

Secondly, we tend to think of our projects as unique one-offs rather than part of a category of projects that have been done before. Seeing how long a project type took in the past – if there is good data about it available – is helpful to gauge the future.

"Most people think that unknown unknowns cannot be forecasted, and that sounds reasonable. But the data for the projects in the reference class reflect everything that happened to those projects, including any unknown unknown surprises."