Attribution errors in business: Being aware of your biases

in Managing by Nick Petrovic
(3 Ratings)
Attribution errors in business

In small business, we are faced with a vast number of encounters and outcomes in which both our own and others’ behaviours play a vital role. We are, however, all humans, and none of us, owners, staff or clients, are completely immune to the psychological biases that assist us in making sense of the world around us.


Fundamental attribution error (FAE)


You’re driving down a busy road and the car next to you suddenly cuts you off. You think to yourself, “What a bad and careless driver.” Take a similar scenario; you are driving your pregnant wife to the hospital. You cut another driver off, but in this case it isn’t your fault, it’s the situation – right?


When faced with our own and others’ behaviours, we often make fast and sometimes inaccurate judgements about the forces driving them. Humans tend to evaluate behaviours based on what is known as the fundamental attribution error, where we attribute behaviours and outcomes to either internal (i.e. personality or dispositional) or external (i.e. environmental or situational) factors.


We tend to attribute our own negative behaviours to external factors, blaming the situation or other uncontrollable elements, while similar actions by others are assumed to be a result of personality or dispositional flaws. Conversely, we overvalue our internal factors and credit our personalities or dispositions for our positive behaviours or successes, yet more readily take into account external variables (such as luck) for positive outcomes of others.


Applying FAE to business


The attributions we make as business owners are very important. They affect not only our own beliefs and behaviours, but also the relationships we have with our staff and clientele.


Client perceptions


As the saying goes, the customer is always right. Unfortunately, when faced with a situation in which a client must attribute a negative experience with your business to either internal or external factors, time and again the business’s internal factors bear the blame. When we are aware of this common bias, we can tackle a negative situation more equipped to rectify the problem.


It may be the case that your business is at fault. However, in situations where attribution biases are at play, it can act as an indicator of areas where you may need to improve communication, make pre-emptive clarifications or otherwise safeguard your business from similar problems in the future.


Aim to avoid committing the attribution bias yourself. In other words, when faced with a disgruntled client, look beyond the person and analyse the situation – are there things that have led them to this point, things that can be improved? The age-old technique of putting yourself in their shoes is an excellent starting point.


Staff perceptions


Staff can also be prone to attribution error within the workplace. The attributions staff members make about their successes and failures can impact both positively and negatively on their motivation and productivity.


Staff members who attribute the cause of their successes to factors outside of their control may be reluctant to attempt new tasks and may lose motivation to perform well, whereas staff who attribute their success to internal factors (e.g. effort, commitment, persistence) are more likely to have high motivation for work. Keep this in mind when administering praise and rewards.


Manager perceptions


We can’t always control other people or situations. We can, however, improve our control over our own thoughts and behaviours. As a manager, your perception of the causes driving behaviours can influence your judgments and actions.


Managers often observe and assess employee performance. If a manager attributes an employee's poor performance to internal factors such as lack of effort, the outcome for that employee is likely to be negative. On the other hand, if a manager perceives that an employee's poor performance is due to a lack of skill (in other words an unfairly demanding situation), further training may be provided or more instruction given.


Before making assumptions, explore situational factors and act accordingly. It will not only help you in your day-to-day business activities, it will allow you put yourself in your employees’ shoes, and therefore work towards constantly improving the business.


This article represents the views of the author only and not those of American Express.

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Nick Petrovic

Nick Petrovic is a registered psychologist and head of clinic at the Mind Profile Psychology Clinic and has more than 10 years' experience in the allied health and business. Nick has contributed to regular columns in more than a dozen business magazines and newspapers, advising on issues such as mental health, work related stress, strategic planning, business analysis and human resources.

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