‘Don’t listen to your gut’: How is ‘noise’ and bias making you a bad boss?

Decision making is key in business and I’m sure all of us can think of someone we’ve worked with who is a terrible manager.

It’s not just about being a nice person - your best friend can be a bad boss. And while being understanding and supportive is pretty important in people management, the psychology of being a good leader goes a bit deeper.

In the latest episode of The Big Question, we sat down with Prof Olivier Sibony of HEC Paris Business School, a leading academic and business strategist to discuss how to confidently make good business decisions.

A lot of Olivier’s research is centred around ‘noise’ and how it affects our judgement. But what is noise? As much as trying to be productive at work surrounded by office hubbub often feels impossible, that’s not what he’s talking about.

“Noise is simply the variability of judgements. The fact that judgements can randomly be very different from one person to the next, and even from one moment to the next in the same person,” Olivier explains.

A good example is to look at the judiciary system. Someone can be convicted of a crime and, depending on the judge they are assigned and the mood of the judge, the sentence can vary wildly.

“The old saying is that justice is what the judge ate for breakfast.

“We actually have econometric studies that show that there is some effect, not a very large effect, by the way, of the outside temperature on the severity of judgements. When it's very hot, judges are in a bad mood, they tend to be more severe.”

It’s the same reason people often say you should book your driving test for early afternoon because the examiner will have just eaten lunch and be in a good mood. It’s not just a myth. Avoid hungry examiners.

Bias is different to noise in that it's