Horgan, John

Planning fallacy

Before the latter part of 2017, I had numerous conversations and exchanges with senior members of the BC NDP and its caucus researchers. That included John Horgan, who chatted with me while waiting for Lieutenant Governor Judith Guichon’s call to form government and again when he was announcing the December 2017 “decision” to proceed with Site C.

I naively believed John Horgan and other NDP associates were serious when they had talked about Liberal government deficiencies and promised to embrace science based policies and corrective actions. I was aware they understood ethical, scientific and environmental issues but I failed completely to understand those were irrelevant. NDP politics would determine policy.

A person close to government recently confirmed the underlying concern of Horgan’s inner circle was to prevent BC Liberals from repeating what Christy Clark told reporters in 2016:

I think there are enough things that distinguish me from the NDP that will have a few issues on which to run. No to Site C, no to LNG, no to mining, no to Trans-Pacific Partnership. No to just about anything that creates jobs in British Columbia.

John Horgan’s crew had a truckload of hard hats ready to go when they formed government in 2017 and the last thing they intended to do was alter the controversial Site C project, secret deals BC Hydro had with private power producers, LNG promotion, and science-free facilitation of fracked gas.

Going forward with the status quo would cost tens of billions of dollars in unneeded construction and deadly fossil fuel subsidies. It would also exacerbate extreme events from climate change. But following BC Liberal policies would dull the Official Opposition and silence many right-wing critics. The Premier decided that was smart politics for his party.

As my understanding of NDP politics evolved and the scenario described above was confirmed, I was still struggling to understand how a project as bad as Site C could maintain the support of so many capable professionals. That led me to the book THINKING, FAST and SLOW by Israeli psychologist, economist and Nobel winner Daniel Kahneman.

Kahneman’s work is complex and I don’t pretend to understand it completely, But it led me to think about the planning fallacy and decision making that has driven Site C forward throughout the project’s haphazard history. Here is the Twitter thread that resulted:

  • The planning fallacy stems from an overall bias towards optimism, because people are oriented towards positivity. Politicians are more likely to be biased this way than others.
  • We have a tendency to discount pessimistic views or data that challenge our optimistic outlook. This is the flipside of our positivity bias: our preference for affirmative information also makes us reluctant to consider the downsides.
  • When organizations plan projects, too often they focus on imagined successful outcomes not potential pitfalls. They are likely to overestimate their capability of achieving project goals. The result is financial disaster, something that governments will almost never admit.
  • Anchoring is the tendency to rely too heavily on early information when making decisions. After the initial plan for a project, managers are biased to continue thinking in terms of initial goals, methods, deadlines, budgets, etc.
  • Anchoring is especially problematic if original plans were unrealistically optimistic. Even if expectations were massively inaccurate, people feel tethered to original plans and make insufficient adjustments, preferring to make minor tweaks rather than major changes.
  • Project planners tend to discount pessimistic views or data that challenges their optimistic outlook. Preference for affirmative information also makes organizations reluctant to consider the downsides.
  • Executives often remain focused on ways of doing business they are most familiar with and fail to embrace new technology or anticipate changing methods proven by others to be successful. As a result, they underestimate project risks.
  • Managers tend to ascribe positive outcomes to their talents and hard work, but attribute negative outcomes to factors beyond control. They are convinced that external factors leading to failure were unforeseeable.
  • Workplace cultures are competitive and there may be costs for individuals who voice less enthusiastic opinions about a project. Executives favour the most overly optimistic predictions over others, giving individuals an incentive to engage in inaccurate, intuition-based planning.

Categories: Horgan, John, Site C

2 replies »

  1. Ideally our system of governance would have inviolate checks and balances designed to ensure fast thinking is kept in check by slow thinking.

    Problems arise when fast thinkers (read almost all politicians) can use legislative power to sideline entities (like BCUC) set up to slow think in the public interest, or install fast thinkers to Chairs and Boards at Crown corporations (like BC Hydro) where slow thinking is an absolute necessity.

    Liked by 1 person

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