How are Hiring Decisions Impacted by Hindsight Bias?

Posted on March 20, 2012 by Katherine Razzi

Most likely we have all experienced hindsight bias sometime in our lives whether we know it or not. Hindsight bias is our reaction to a past decision. We may feel extremely confident making a decision and feel there is no room for failure, but our decision ends up not being the best possible choice. To reconcile this tension, we tell ourselves, “Oh I knew that wasn’t the right decision all along.”

Hiring decisions are among one of the most researched topics in the HR field because of the presence of subjectivity. Hiring managers throughout organizations do not all use the same process in selecting candidates for a position. Some organizations tend to go by the “gut instinct” when selecting candidates meaning they just know when a candidate will be the best for the position. Others tend to stick to structured systems that award points to candidates based on a series of steps.

Even with lots of experience, a hiring manager can make a mistake. Perhaps something was missed during the process that would have immediately been a red flag. Harley (2007) conducted research on expert judges and found that even with years of expertise; judges were still subject to making poor decisions and subject to hindsight bias. What was the cause? It may have been the lack of reported outcomes.

In the business world, a hiring manager may not be aware of his or her own hindsight bias if they do not receive information regarding the outcomes of hired candidates. The manager may assume that all the candidates they hired were great and perfect fits for the different positions. If confronted about a poor performing employee, the manager may experience hindsight bias and reply, “Well, I kind of knew that XXXX wouldn’t last long here.”

What can be learned? The hope of any organization is to hire strong candidates that will be high performers and will stay at the organization for an extended time period. If a hiring manager is confronted with hindsight bias and is able to learn from past hiring experiences, then the future hiring processes can be positively influenced. For instance, if a hiring manager discovers an employee that they hired fails at the organization, the hope is that that manager will learn from the past.

Have you ever experienced hindsight bias? How should HR hiring managers be trained to avoid such bias?

Reference: Harley, E. (2007). Hindsight bias in legal decision-making. Social Cognition, 25, 48-68.

About Katherine Razzi

Katherine Razzi hails from the Midwest and holds a B.A. in Applied Behavioral Science from National-Louis University, Evanston Campus. Coursework in cultural diversity, management, organizational dynamics, morals and ethics, group interaction, and psychology.

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