Noise Pollution

Abstract

The authors of Noise: A Flaw in Human Judgment are a trio of intellectual heavy hitters: Nobel-prize winner Daniel Kahneman, constitutional law scholar Cass Sunstein, and former McKinsey consultant (and current management professor) Olivier Sibony. As prolific as they are prominent, the three of them have collectively produced over fifty books and hundreds of articles, including some of the most cited research in social science. If academic publishing ever becomes an Olympic sport, they’ll be prime medal contenders, particularly if they get to compete as a team or on a relay. Their combined coverage of law, economics, psychology, medicine, education, finance, political science, corporate strategy, statistics, and even Star Wars gives the book the feel of a cognitive decathlon.

This review focuses on a key distinction introduced at the very beginning of the book: the difference between bias and noise. It then offers several ways to think about this distinction, as well as specific steps you can take to avoid—or at least minimize—the damage that noise in particular creates.

Following these steps is unlikely to win you any awards for innovative management. Nor will conducting the “Noise Audit” attached as an appendix to the book. As one of the authors himself acknowledges, noise prevention is “a little bit thankless.” Yet what you miss out in terms of gratitude and acclaim, you might gain in terms of efficiency, accuracy, and fairness. You don’t need Daniel Kahneman’s Nobel Prize in Economics to know that’s a pretty good trade-off.

Keywords: Bias, Decision-making, Judgment, Error, performance reviews