The Planning Fallacy & Your 2017 Goals

Understand the Planning Fallacy January is a time for reflection and planning.  It seems that we have a  new sheet, a new year and a blank canvas.  We can in a sense leave the past behind us.  This year will be new and different – definitely much better than last year.  We can have a notion to make this year our best year yet.  That is certainly my own intention as I start on my annual journey and as our planet continues on it’s journey around the sun.  When planning our year ahead however it is important to be aware of a judgement bias called the planning fallacy.

“The planning fallacy is a phenomenon in which predictions about how much time will be needed to complete a future task display an optimism bias and underestimate the time needed.”

-Daniel Kahneman and Amos Tversky, 1979

This phenomenon occurs regardless of the individual’s knowledge that past tasks of a similar nature have taken longer to complete than generally planned.  The bias only affects predictions about one’s own tasks; when outside observers predict task completion times, they show a pessimistic bias, overestimating the time needed.

Management books even recognize the highly pervasive effects of time underestimation: the “laws of project management” state, “A carelessly planned project will take three times longer to complete than expected; a carefully planned project will take only twice as long (Pfleeger, 1991, p. 41).

One famous example of the planning fallacy is the construction of the Sydney Opera House, where construction lasted 6 years longer than predicted, at a cost almost $100 million over budget (Hall, 1980).  Another example is the construction of the channel tunnel (Chunnel) to connect London and Paris which was finally completed in May of 1994, even though initial estimates planned on it being completed in June 1993. The cost rose to over 10 million pounds, immensely more than the estimated 4.9 million pounds.

I have come across the Planning Fallacy many times in my own life.  Completing my PhD is an example.  At the start I expected it to take three years, when in fact it took me six years to complete, and was much much harder than I expected.  I even wrote a book about my experiences of doing my PhD to help others following after me.   A study by Buehler, Griffin, and Ross (1994) shows that I am not the only one who gets it wrong when predicting academic completion dates.  In this study, a class of students was asked to estimate the date at which they would finish their thesis. They actually completed their thesis, on average, in 56 days. However, they predicted they would complete their thesis in 34 days. Indeed, even when asked when they might complete their thesis if “everything went as well as it possibly could”, the mean response was still 49 days.

Another example which I have from my own life is buying a new home and moving house. It took me two years longer than I had expected at the outset of the project.  I simply could not predict all the challenges that  would occur ahead of time which slowed me down immensely.  Another example of the planning fallacy comes from Daniel Kahneman’s recent book, Thinking, Fast and Slow.  The study found that the typical homeowner expected their home improvement projects to cost about $19,000. The average actual cost? $39,000.

Effects of the Planning Fallacy

The biggest consequence of the planning fallacy is that we do not set ourselves enough time to complete key tasks, exacerbating pressure and stress.  We can feel despondent and perhaps even want to give up on our goals due to what we may believe is a lack of progress.  When you become discouraged your work rate can go down and this makes it even harder to achieve your goal.  I know this is how I felt when I was doing my PhD and partly explains why it took twice as long to complete.

What to do about the Planning Fallacy

I think awareness of the planning fallacy is really important.  Knowing that we are subject to this cognitive bias when planning is very helpful.  We can take a more detached look at our goals.  Can we really achieve this goal in this time frame?  What does past experience tell me?  Have I completed a similar project in the past,  how long did it take and what obstacles did I have to overcome?  You could share your goals with an uninvolved outsider and ask for feedback on how long they expect your goal to take.  Doing this we may get a more realistic (if somewhat negatively biased) projection.

An important question to ask yourself is what do I have to do or change in my schedule if I really want to make this goal happen by this particular date?  What increase in the amount of resources (time, focus and money) do I need to make in order to complete the goals I have set on time?   I think that three goals are defiantly enough at any one time.  Focus on three key goals only and maintain your focus on them.

Today when I reflect on my first quarter 2017 goals I have probably fallen again for the planning fallacy.  It seems now that the completion dates I have set on two of my three goals are overoptimistic and need to be adjusted to allow more time.  Life gets in the way  of goal achievement and distractions abound.

In the light of the planning fallacy how realistic are your 2017 goals?  What do you need to change in your schedule, your daily routines or resources allocated to goal achievement to make sure your goals happen by the deadline you have planned for?

Further reading/references

Buehler, R., Griffin, D., & Ross M. (1994). Exploring the “planning fallacy”: Why people underestimate their task completion times. Journal of Personality and Social Psychology, 67, 366-381.

Hall, P. (1980). Great planning disasters. London: Weidenfeld & Nicolson.

Kahneman, D., & Tversky, A. (1979). Intuitive prediction: Biases and corrective procedures. TIMS Studies in Management Science, 12, 313-327.

Kahneman, D. (2011). Thinking, fast and slow. New York: Farrar, Straus and Giroux.

Pfleeger, S. L. (1991). Software engineering: The production of quality software (2nd ed.). New York: Macmillan.

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Did you find this article helpful?  If you have found it useful please do me a big favour and share it with others.  Thank you :-) Tom Carroll, January 2017.

Top Planning Tips for 2017

Christmas and the New Year - a time for pause, reflection and change
Christmas and the New Year – a time for pause, reflection and change

Its hard to believe that 2016 is nearly over. It seems to have whizzed by.  As I get older the years seems to whiz by faster and faster.
In my part of the world (Ireland) Christmas and the New Year period is a great time for getting off the treadmill of daily life and just stopping and reflecting. Offices, schools and colleges shut down and people go on holidays.  Suddenly there is time to think and reflect. The daily treadmill is switched off.  The change in calendar also makes us want to start afresh.  As I write 2016 is ending in a few days and we will soon have to get used to writing the new year – 2017.  This prompts some questions – how was 2016?  What do I want to achieve in 2017?  What can I do better or differently in 2017?  In this article I want to share some ideas which you might consider incorporating into your life as you embark on the new year.  Remember that taking action and implementing even one of these ideas has the potential to change the direction of your life in a new and more positive direction.  You may have seen these ideas before but remember that knowing is not enough – you must act and implement the idea in your daily life.

Get visual

The mind is like an iceberg.  Most of an iceberg is underwater and so is the operation of your mind.  Above is the conscious mind but below the surface is the vast and powerful subconscious mind.  You defiantly need to engage your subconscious mind if you want to make changes in your life.  Imagine the subconscious mind to be an elephant and your conscious mind the rider.  If the rider wants to go in one direction and the elephant wants to go in another direction who will win?  The elephant will win because that is where all the power and strength lies.  You need the elephant and the rider to want to go in the same direction so make sure and engage your subconscious mind.  I will give you examples of how to engage your subconscious mind in this article.

Get clear about what you want to achieve

Where do you want to be in 5 years time?  Close your eyes and visualise now about your ideal future.  What will your life look like?  Who will you be with?  Your wife, children, parents, famigoalsly and friends etc.   What will you have? Visualise your ideal job, money, home, weight etc.   Let yourself see your ideal future situation.  Really allow yourself to feel it.  Imagine you have achieved everything you wanted.  How does that feel.  Does it bring tears to your eyes?  It should.   Really let your mind focus.  Visualisation is a means to engage your subconscious mind and emotion is a very powerful way to programme your subconscious.  Get the elephant to travel in the direction you want.  For example if you want to lose weight then visualise yourself looking in the mirror and seeing yourself as being the ideal weight.  Allow yourself to really feel as if it has already happened.  It feels wonderful doesn’t it?  You are now imprinting that vision on your subconscious

Keep it simple

Don’t set 10, 15 or 20 goals for the year.  Set only three!  I like the number three.  Keep it simple.  Don’t dissipate your energy and focus by trying to do to much.  If I were to ask you what your three goals are you should be able to tell me your three goals immediately.  You should not have to pause to try and remember them.  Make these three goals great.  Make them WIGs – Wildly Important Goals – goals that when you achieve them will potentially transform your life for the better.  The WIGs concept comes from a book called The 4 Disciplines of Execution: Achieving Your Wildly Important Goals.  Your three key goals for the year should be on the tip of your tongue at all times.

Keep your goals in front of you

You have three key goals (WIGs) for the year.  Break them into sub-goals and each quarter aim to achieve these sub-goals which will help you achieve the larger WIGs.  Make sure that you have no more than three goals your are aiming to achieve at any time.  In fact each day aim to achieve only key three tasks which should move you towards your goals.  Keep it simple and memorable.    I like drawing the 4 Maps each morning as a way to remind me of my key goals and the link between today’s tasks and my goals.  Please see my earlier article on the 4 maps.

Create good habits

Much of our behaviour is run by the subconscious mind.  Think of how you get up in the morning and brush your teeth (I am assuming that you do it!).  It seems to happen automatically without you having to think about it.  The same if you drive a car.  Your mind knows what to do without you even having to think about it.  You can be thinking of other things, holding a conversation etc as your subconscious drives the car.  Our habits are subconscious programmes.  We need to make sure that these habits help us achieve our goals.  I have built a habit of getting up early.  I get up at 5am Monday to Saturday.  I don’t have to think about it – it just happens without any effort.  I built that habit a number of years ago.  Before that I had a habit of sleeping in.  This one habit alone helps me enormously when it comes to achieving my WIGs.  The time alone in the early morning when the rest of the family are asleep is very valuable and I can make progress on my WIGs little by little each morning.  Do your habits help or hinder you?  What new habits would you like to incorporate into your life in 2017?

Live in Day Tight Compartments

Today (Now) is the only time we have to live.  Live each day to the full and be fully present in this day.  This is one of Dale Carnegie’s principles for overcoming worry and he calls it living in “day-tight compartments.”   This concept is from the book How to Stop Worrying and Start Living .  A way to be more present and focused in this day is to practice mindfulness.   I recommend you learn mindfulness from Willie Horton at Gurdy.Net.  I have taken one of Willie’s mindfulness courses online and practice mindfulness everyday and it has helped me enormously when it comes to being more focused.   I have much more focus on the Now as opposed to being distracted by the past or the future.  Each day is a miniature life – make the most of today.

Daily Plans

Each day you should have a plan.  Each day should take you closer to achieving your quarterly goals which will in turn take you closer to your WIGs.  Plan each day in advance the night before.  When you get up in the morning you should have a schedule for the day  ahead and know what three key tasks you will be working to complete that particular day and when they will be worked on.  Blocking time to work on your three key tasks is very important otherwise distractions and lesser important tasks will take over.

Weekly review

At the end of each week sit down and review the past week.  How did it go? What did you learn?  What can you do better next week?  Look at your planner and see what is coming up in the week ahead and broadly plan the week ahead and make sure you schedule time for your WIGs.

Take Daily Risks

I don’t mean bungee jumping but if that is what you want to do then that is fine too.  What I am talking about here are small risks.  It could mean picking up the phone to call someone, sending an email or knocking on a door or asking someone for something or just to say hello.  A risk is something which makes you even slightly uncomfortable but you know that needs to be done.  When we take risks we are expanding our opportunities in the new year.  What I want you to do is write one small risk in your diary to do each day.  I call my risks my TR.  This stands for Today’s Risk.  Plan a TR every day and do it.  You will build courage through this as you push through fear and discomfort and your world will expand in small daily doses.

Be Creative

Be creative every day.  Schedule time for creativity.  You are reading this article now because I have a space in my day called my ‘Creativity half hour: Write 10 ideas a day on my daydreams and take some tiny steps’.  I picked up this idea from a man called James Altucher (see below educate yourself below).  Get used to generating ideas every day. Altucher calls this building your creativity muscles.  Make a habit of creativity and make time to take tiny steps to making some of these ideas happen.  These tiny steps could be TRs (Today’s Risks). The ideas you generate can potentially take you in new, unexpected and exciting directions in 2017.  Directions that you cannot necessarily predict.  Make yourself open to serendipity  in 2017.

Educate yourself!

Keep learning in 2017.  The world is changing faster than ever.  The pace of change will continue to increase.  New technologies and innovations are coming on stream all the time.  Industries are being transformed in front of us due to changing technologies.  Take for example banking.  My local bank branch has transformed itself as banking has gone online.  When you go to the bank now you are directed to machines.  There are fewer and fewer staff needed.   Much of your banking can now be done on your smartphone.  Video rental shops and travel agents have closed as people have shifted to downloading videos and booking their flights online.  When I worked in Kenya in Africa in the 1990s my former boss used to say that what we need for development to happen is a phone in every village. That was about 1996.  It seemed like an impossible dream then.  I just returned from a visit to Kenya in the last few weeks and what we have 20 years later is a phone in ever pocket. On that phone is a digital bank account which people can transact their business.  Ordinary poor people have gone from being excluded from communication, information and banking facilities to being fully connected on a 4G network.  Kenya is now a world leader in mobile technology.  Who would have though this transformation to be possible in such a short space of time?  There are so many new technologies coming down the tracks which could transform our lives.  For example robotics, virtual reality, drones, self drive vehicles, biotechnology etc.  The only way to be prepared for a new world is to keep learning new and relevant skills. Take some courses in 2017.  There are so many opportunities now to learn new skills and knowledge.  Take for example MOOCHs – Massive Open Online Courses which are free if you don’t need the certification. There are very many MOOCHs but for starters check out Coursera.  Another great site for courses which I used to learn how to build this website is Alison.  The quality of the course was excellent and you can study in your own time.   Through the skills I learned from Alison I have developed a number of websites.   Another site worth checking out is Udemy.   I am signed up for some courses with them and they are relatively cheap.  Anyone can develop their own course and launch it on Udemy.  Perhaps you might consider launching you own online course in 2017?  You might also consider learning a language in 2017.  I am using  Duolingo to learn Portuguese.  I have a daily habit of 10 minutes per day on Duolingo.  I really enjoy it.  After three years of doing this I am, according to Duolingo, 30% fluent in Portuguese.  This is an example of a positive habit expanding my world with the addition of a new language.

Of course there are also many opportunities to study offline in the traditional way at your local college or educational institution.  The big advantage of doing a college course is the face to face interaction with fellow students.  Through this interaction you can meet new people and make new friends.  An additional new qualification might open new doors for you.  Don’t be put off by the time it may take to get a new qualification.  Remember the time will pass anyway whether you take the course or not.  Go for it if this is really what you want to do.  There are also blended learning models to consider which combine online and offline learning and are tailored to people with busy work schedules.    

Read/Listen to books and Podcasts

At the moment I am reading Tools of Titans: The Tactics, Routines, and Habits of Billionaires, Icons, and World-Class Performers by Tim Ferris.  There is huge wisdom contained in this one book alone.  I have built a habit of going to bed early and reading in bed.  I don’t allow myself to use gadgets in bed as the light from screens can prevent you falling asleep.   When you read you expand your mind and your potential.  Reading is key to your success and make sure you schedule time in your day to read.

I also listen to audio books and I have had an Audible account for years.  Every month I get charged a reasonable monthly fee and in return I get one credit to use to purchase an audio book of my choice.  That is 12 audio books a year.   That is a potential wealth of knowledge you could learn in 2017 from audio books.  The great thing about audio books is that you can listen as you commute to work, walk the dog or do your housework.  I am currently listening to How to Stop Worrying and Start Living by Dale Carnegie which I mentioned earlier.  This is a personal development classic and there are great nuggets of wisdom contained in the book.

Podcasts are another wonderful way to educate yourself.  In the last few months I downloaded a free android app for my smartphone called ‘Podcast Republic‘.  There is a wealth of material to listen to on a whole range of topics.  I particularly enjoy Tim Ferris and James Altucher both of whom have an interview style podcast.  They interview people who are successful in all walks of life.  There is a tremendous amount that can be learned for free from these conversations with successful people.  Another Podcast I recommend is Pat Divilly.  There are many many more and I myself am just scratching the surface.

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This article contains some great ideas to implement in 2017.  Perhaps some/many of them you are already doing?  However even if you see one new idea you can incorporate in your life in 2017 then this article will have been well worth reading.  You must however actually implement it.  There is a huge gap between knowing something and doing the thing we know we should do and that is where many people get stuck.

I have really enjoyed writing this article.  I hope you found it interesting and useful.  If you like this article and want to read further ideas on how you can make 2017 an outstanding year for you and your loved one then you are invited to buy and read my book:
Experiments in Personal Change: Transform Your Life

I would like to take this opportunity to wish you and you loved ones every success and happiness in 2017.  Why not make it your best year yet?

Tom Carroll PhD, December 27th 2016

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What do you think of this article?  If you like the article and think it would be of value to others please do me a big favour and share it with others.  You are also invited to comment on the article in the comments section below.

Thank you :-)