What is Impact Bias, and How Can It Affect Us in the Workplace?

Have you ever dreaded a conversation at work? Many of us expect the worst-case scenario; we might even spend time agonising over potential outcomes before taking the plunge and deciding to just go for it.

And guess what? Everything is fine! The conversation goes past with no issues whatsoever, and all that is left is a thumping heart rate and a feeling that we might have overreacted in some way. However, what has just happened is something very normal and human.

Experiencing bias is very common in both the workplace and in our general lives. Worrying that a future event will cause a certain feeling or intense dread is something that we have all likely experienced at one point or another. We actively anticipate certain outcomes, especially for potentially stressful situations, but the reality is that most of our predictions don’t actually come to pass. This overestimation of intensity is called impact bias. Let’s explore what it is and why we feel it so intensely.

What is impact bias?

An impact bias occurs when we overestimate the intensity and duration of an emotional impact and the response we will have. It belongs to a part of psychology called affective forecasting (sometimes also called hedonic forecasting), first coined by Daniel Gilbert and Timothy Wilson in a paper in 2003.

This is no new phenomenon and has, in fact, been studied for centuries. It has even been discussed as far back as 1759 by Adam Smith in his text The Theory of Moral Sentiments:

In this miserable aspect does greatness appear to every man when reduced either by spleen or disease to observe with attention his own situation, and to consider what it is that is really wanting to his happiness.

The Theory of Moral Sentiments, p.163(*)

We are inclined to sit around thinking about what has and will come to pass, and how we will be affected by that. It can be overwhelming to experience, but it is comforting to know that we all experience it.

Where does impact bias come from?

Impact bias is linked to two of our most common emotions: happiness and fear. These are all emotional reactions that we have regularly, maybe even experiencing them every day to a minor degree.

Both the definitions of happiness and fear are incredibly subjective. We are all made happy by different things, and likewise, we all have different things that cause us to feel fearful. As such, it is difficult to pinpoint exactly one thing that could cause us to experience impact bias.

Rather than hunt down precisely where impact bias comes from and why we experience it, we better serve ourselves if we embrace it and look to the effects it has on our everyday. Since it is based on future events and actions, we should acknowledge that it happens and focus on our reactions. In doing so, we are better equipped to recognise and work through this scenario when we encounter it.

What are the effects of impact bias?

The effects of impact bias can affect several layers of our understanding of the world around us. If we dwell on it too much, there is a chance that it could affect both ourselves on an individual level and our surroundings on a systemic level.

Individual

When the impact bias affects us on an individual level, we can see that it affects decision-making across many areas of our lives. From health and finance to personal and professional relationships, impact bias can cause damage if left unchecked.

We naturally want to gravitate to the actions that we perceive as bringing us the most happiness. Have you thought about a career change? A move to a new city, or even an entirely new country? Have you ever just sat and thought about how good your dinner is going to be that evening? These are all forms of impact bias.

Remember, some of these are not inherently bad (after all, there is nothing wrong with anticipating a delicious meal), but we need to be mindful that it might encourage impulsive decisions. For example, you might visit a foreign city on a short break and fall in love with the place. You begin to daydream about moving there and starting a new life without thinking through the difficulties and realities of doing so. You impulsively quit your job and decide to move, then quickly realise that this new life you have dreamed of is not so easy. Rather than make an informed decision, you have decided to jump into a quick decision that has not delivered the rush you believed it would.

This can also be negative. For example, we might perceive an event like a job interview as being more anxiety-inducing than it actually ends up being much more manageable. However, the anticipative anxiety we feel keeps us from taking that crucial action that could help us grow in the long run. You might actually be well-versed in this feeling, as we frequently refer to it as staying in our comfort zones. Change can’t happen if we aren’t willing to take a chance and push beyond our self-imposed boundaries.

Systemic

Impact bias can also affect the systems and structures around us, not just our everyday actions. This is especially true in workplaces, and it is something that leaders and managers need to be mindful of so it does not hurt other workers.

For example, an employee may be given a promotion to leadership. This is something they have wanted for a long time; they think the increased pay will lead to a better quality of life for them, and they will have the opportunity to bring fresh ideas and practices that could transform the way the business operates. However, they are saddled with more responsibilities than they initially expected, and they are not supported by their own leadership, leaving them feeling untethered and unmotivated.

Another example could be an interim manager brought in to consult and provide expertise as the company undergoes major restructuring. The organisation’s employees worry about how this will impact their day-to-day and so may prove resistant to the recommendations made. Though these changes may actually be better in the long run, they refuse to consider them and instead create more difficulties.

How to avoid impact bias

To avoid impact bias, we need to focus on two areas: (1.) reflection and (2.) focus. Bringing in both these practices will ultimately help us align with good practices that allow us to embrace and mitigate the effects of impact bias.

Reflection

Since impact bias focuses on our future emotional states, reflection allows us to look backwards at similar situations to see how we then reacted. By better understanding these reactions, we can take a more even-tempered approach to future emotional reactions. Even if we know that we face a negative event, if we have been through something similar before, we understand the emotional consequences it might bring. This can help us to temper our future emotions and ensure there is not a big swing in either direction, positive or negative, and give us support to recover emotionally.

Focus

We also need to widen our focus. Impact bias and people’s affective forecasts are all very self-focused. Even if the outcome is tied to something much bigger, such as sports fans waiting to see if their team will win a closely-fought game, our reactions don’t spread much beyond our own positive and negative emotions. By focusing on the bigger picture and widening our field of view, we can hopefully train our emotional responses to not be as polarising as they have been in previous events.

Embrace change and manage it more successfully

Ultimately, people tend to overestimate their reaction to positive and negative outcomes. Though these responses can feel overwhelming, especially if negative feelings are involved rather than strict apathy, it is important to remember that such feelings are completely normal, and we all have them.

Change is good, and it challenges us to grow and learn. In a workplace context, change and the unknown can feel uncertain, especially when social and operational norms are upended or the period of change is extended with no end in sight.

Leaders need to be equipped with the tools and knowledge to guide their teams through these times of change and to navigate resistance when it occurs. Though it can be difficult to do so when a team is actively anticipating the worst, clear communication and a measured approach will always be appreciated.

ChangingPoint’s Universal Change Leadership Programme aims to equip leaders with the tools they need to help leaders engage and align with their teams during times of change. Evolve your own mindset, and give yourself the understanding you need to help others.