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Unconscious bias gives bad advice

Have you heard of the NeuroLeadership Institute? You've probably heard of something they talk about a lot - Unconscious Bias.

As a quick primer, the NeuroLeadership Institute showed through some pretty spectacular research that bias is biological - it's essentially a series of shortcuts that our brains have evolved to have.

Hence the term 'unconscious' - you're not conscious of your bias, it's a shortcut that your brain makes so quickly that you're not aware of it. These shortcuts allow us to rapidly assess relative danger in order to stay alive.

It's a lot like the System 1 thinking that Daniel Kahneman analysed in his Nobel Prize-winning work that inspired his incredibly popular book Thinking Fast and Slow.

All of these shortcuts in our brains are clearly much more useful to our ancestors who were trying not to get eaten by tigers than to our attempts to hire the right people and not make catastrophic financial decisions. We'd do both of those much more effectively if we used the logical brain over the lizard one... But we're stuck with these shortcuts, so let's look at how we can circumnavigate them to make the best decisions for our businesses in this coming year.

Unconscious Bias gets a lot of coverage when it comes to DEI, hiring, and the horrific lack of diversity in business leadership (did you know that less than 10% of Fortune 500 companies have a female CEO?), but it's important to all kinds of decision-making - in business and in life in general.

The kicker with unconscious bias is not just that you're not aware of it happening, it's that you can be so unaware that you passionately believe that the decisions it powers are driven instead by objective facts.

Ever read one of those self-aggrandising posts from a hiring manager who says 'I don't make hires based on demographics, I make them based on who is best for the role and the people who are best for all the good roles in my team just happen to be straight white men'? That's unconscious bias at play - and that's also why the comments section will make you strain your eyes from rolling them so much.

How to circumnavigate your organisation's in-built unconscious bias

As an entrepreneur, you're bombarded with advice from all kinds of people from all angles. It can be impossible to discern what's great advice from actual experts versus what's bad, biased advice from people who are cosplaying at success on LinkedIn (unless you look for the watches and cars that are 'accidentally' in the background of their hustle posts - always a telltale sign).

Even when the advice is coming from experts, how can you navigate that evolutionary bias to help you make the right choices?

  1. Acknowledge your bias. Like the monsters under your bed, unconscious bias does its worst work when you try to pretend it doesn't exist. No human is perfect, no human makes perfect decisions - heck, even the robots we're creating to help us improve decision-making are constantly screwing up.

  2. Actively look to surround yourself with people that are different to you - different background, opinions, demographics. These people offer a different perspective and that can be uncomfortable, but you know what else is uncomfortable? Failing because you can't see past your own assumptions.

  3. Build your own stop signs in your processes to force you to take a step back and ask where you're using logic and where you're being driven by bias. The NeuroLeadership Institute has some great articles here on that. I like to implement a system that I call the 'Business Arsehole' - nominate at least one person in each decision-making process to come up with reasons to disagree with group consensus. It helps teach you how to truly interrogate your choices.

By implementing these steps, you can start to make better decisions for your business and, in turn, see better outcomes. As a starter, let's look at five classic piece of business advice and explore where bias is showing its influence, and why they might not be right for you.

Classic 'advice' to ignore in 2024

1. 'Always be hustling'.

The world of entrepreneurship is rife with clichés and if there’s one phrase that annoys me more than any other, it’s the suggestion that ‘everyone has the same 24 hours in a day’.

The implication is that the reason you’re not successful with your business is because you’re lazy and you’re not making the most of those hours.

Ignoring for a second the fact that different people need different amounts of sleep, some people have to give some of their hours to the care of other people, and some people have to travel long distances to a place where they can work. Even if you had 24 full hours in which to focus on building a business, your interpretation of those hours would be so different to someone else’s that you could never class them as ‘the same 24 hours’. 

A male entrepreneurship influencer with a nanny, pre-prepared meals, and an assistant can give you the advice from the bias of his own experience. And that can make you feel awful.

What can you do instead? Give yourself grace and remember that you're trying and that's what matters. Remind yourself that no-one is perfect and a lot of shit you see on social media is faked beyond belief. Instead of feeling bad that you're not 'always hustling', why not set time aside each day for deep focus, any uninterrupted time that you can get, even if it's 30 minutes. Hustle for 30 minutes a day and that's 3.5 hours a week of focus time. You can get a lot done in 3.5 hours when you're not beating yourself up for not being perfect.

Read more about harnessing your own motivations and your own circumstances to build the best business for you in my book How To Build With A Mission.

how to build with a mission

2. 'Always do what the customer wants'

History attributes the phrase 'the customer is always right' to Harry Gordon Selfridge, founder of Selfridges department store, in 1909. Unless you're running a vast department store in a time of huge class inequality when success hinged on the whims of the rich, you can ignore this.

Harry's situational bias has been handed down through the generations like a bad set of genes. Great customer service is one thing, twisting yourself into a human pretzel is not great customer service.

A lot of customers don't even know what they need, let alone what they want. Did customers know they wanted an app on their phone that could deliver a ride-sharing owner-operated vehicle to their door before they were told it was an option? They did not.

What can you do instead?

Part of your role as an entrepreneur is to understand customer problems, not wants. Understand areas of friction in customers' lives and build to remove that friction. Market towards how it will feel to not have friction and stay the course. Real product-market fit comes from providing the best solution to a problem, not from over-spending on product management to build endless reams of features.

Read more about how to deeply interrogate customer problems to find product-market fit in my book, aptly named How To Find Product-Market Fit.

how to find product-market fit

3. 'You need a product, not a service'

I've worked with a lot of businesses that have been product-centric and a lot that have been service-centric. There are pros and cons to each.

I see a lot of business-related content that glorifies Product Managers and the Sales teams that sell products in high-growth businesses. A lot of those businesses that are posting high valuations are churning through money much faster than they're bringing it in. Their real business model is raising VC cash and spending it.

When only 1% of VC investment in the UK goes to female-led businesses and with 97% of VC-funded founders having at least a tertiary education (both via Sifted), this kind of business is an unrealisable dream for most people.

The people telling you that you can only succeed with a product-centric business can be seeing the world through the bias of their own experience. And that experience may not be right for you.

What can you do instead?

Ask how many of those product-centric businesses are actually product-led. By this I mean, how are they generating revenue? If you're selling a product but doing it by spending large on sales teams and on the post-sale customer support options you offer, are you really running a product business or are you running a service business that's masquerading as one? Most importantly of all, ask yourself what you want out of this business in a long run. Are you determined to sell? If so, do product-centric businesses in your industry sell better than service-centric ones? Do you just want a profitable operation? If so, can you drive profitability more easily through efficient service-provision?

Interrogate your own circumstances, not someone else's bias.

4. 'Target the biggest market possible'

Ok, sure, if business growth was formulaic and linear then a bigger market could represent a bigger return for your hard work. I'd say 'sadly it's not', but I'm not sad about that - I take a lot of enjoyment out of solving business problems contextually and my only other hobby, listening to the same Taylor Swift songs on constant repeat, isn't quite as lucrative.

A target market is exactly what the name suggests - it's the market, the pool of people or businesses, that you want to target, or approach, with your product or service because your research has told you there's a good chance they'll buy it.

You unfortunately don't automatically start to win big by going after a bigger market initially. A larger company may have a larger target market. That's because they've worked themselves towards that point. A recency bias can easily tell someone running that company that a massive target market is great. It's not great for an early stage business.

What can you do instead?

Your Target Market is not a static thing; as your business grows, so too can the Target Market. In the early stages of a business, you're calculating an initial Target Market from your basic (but data-driven) assumptions about the first group of customers you want to acquire. As the business develops, and you add things like more features or more locations, you can expand that Target Market.

Regardless of what you're building, smaller targeting groups are what you need to aim for at this stage. Even if you've identified a relatively wide-spread Problem, like a need for a phone, for example, you can't define your initial Target Market as 'everyone'.

Some people may already have a phone, other people might need their phone to do something yours doesn't. Some might only want to buy a phone in a colour yours doesn't come in. Some might have accessibility needs for their phone that you don't offer. There will always be a group for whom your solution isn't (yet) right - this isn't a bad thing, it's actually a good sign that you've created something that properly solves a specific Problem.

Taking the time to define an initial Target Market for your startup doesn't mean that you're not going to be able to build a solution that eventually has mass-market appeal (if that's something you want to aim for), it just means that your very first efforts, the plans that you make for the early stages of your business, are as efficient and effective as possible.

By pinpointing your Target Market down to the exact group of people or businesses who have the Problem or need that you've identified, and who want or need the unique features that your specific solution offers right now, and who you can convert into a customer, you can focus your efforts today and increase the chances that they'll become customers before you move on to solving for others.

Read more about how to define your initial Target Market and build efficient operations for your young business in my book How To Find Your Customers.

how to find your customers

Next steps

So, in summary: everyone is biased, even you.

To overcome these biases in entrepreneurship, acknowledge their existence. Actively seek diverse perspectives, implement checks in decision processes, and nominate yourself a trusty 'Business Arsehole' to challenge consensus are strategies proposed. Ultimately, you've got this.

And if you're worried you don't got this, book a free Discovery Call below to find out how I can get this for you.


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