Kahneman's dual-system thinking
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Abstract
According to the Nobel-prize winner in Economics and author of the book Thinking, Fast and Slow, Daniel Kahneman, there is a model of human thinking, which consists of two separate thinking systems. The first system (System 1) can be described as instinctive, effortless and fast in contrast with the second one (System 2) which is more tedious, slow and related to analytic type of thinking. Dual -system or dual-process theory often links design thinking to the model of human thinking from cognitive psychology.
Both systems are connected to each other and, simultaneously, are in conflict. For instance, when a human is awake, both systems are active. Most of the times, System 1 acts more automatically and generates situations for the second system such as impressions, feelings etc. [1]. System 2 is referred to low-effort situations and the outcomes, when System 1 interferes, can be translated as beliefs or specific actions. System 1 is often connected to human’s daily behavior while System 2 normally is in charge of the final decisions.
Dual-system theory consists of numerous daily-life examples, which depict the common beliefs of humans as rational beings that are able of taking decisions analytically and impartially [2]. A project is characterized by complex problems that need to be solved by applying thinking systems.
The main objective of this article is the application of the two-system thinking theory in decision-making, especially in the field of Project Management. By comprehending the engagement between the psychological part of thinking – systems and the multi – tasking parts of a project, the decisions that concerns cost, management or programming can be much easier and applicable.
Big Idea
Regarding the book of Kahneman [1], the terminology of the two systems was concerning the field of psychology for decades. An initial labeling on this kind of thinking was firstly introduced by the psychologists Keith Stanovich and Richard West referring to them as System 1 and System two. According to their proposal, System 1 can be described as an effortless, automatic, and a quick way of thinking. System 2 is associated with complex activities that necessitate concentration, effort, and time. The author takes a step forward on the use of this terminology in order to make them more comprehensible not only in the area of psychology, but also in the wider scientific fields that are related to the decision-making process. A more extensive analyzation of the two systems as well as their connection between them are presented below by several examples.
System 1
When it comes to System 1, the most appropriate word to describe its whole nature is automation. There are several everyday actions, behaviors, and activities that a human being usually does without making any effort or any thinking. This type of thinking requires inherent skills such the perception of the world from the time a human was born, the sense of fear, the recognition of simple items or the avoidance of unpleasant situations. Additionally, there are some skills that acquire knowledge, practice, and time in order to be characterized as “automatic” such as chess moves. Some simple examples of System 1 are: • Easy mathematical functions like multiplication, addition etc. (3 x 3 = ?, 10 + 5 = ?) • Expressions of disgust when smelled or shown something repulsive. • Comprehension of simple sentences in your own language • Detection of the source of a sound • Fear of something horrifying like snakes, spiders, sharks etc. • Recognition of hostility in a voice • Replying to something simple such as which is the capital of a country (knowledge acquired) • Driving a car on an empty road • Finding strong chess moves or in general game moves (knowledge acquired by specialized players)
System 2
The well-known properties of System 2 are attention and concentration. The performance of each action or activity depends on the concentration of the human. For examples, when the attention is distracted, the performance does not have the expected outcome and it can be reported as bad performance or inadequate. Some examples are: • Filling out important documents • Price or quality comparison of products for future purchase • Looking for a person with specific characteristics in the crowd • Focusing on the voice of a specific person in the crowd. • Observation of the appropriateness of a bad behavior in the workplace or a social situation • Examination of the rationality or objectivity of a complex argument or statement • Searching memory to distinguish a familiar sound or face. • Adaptation to new data like driving on the right instead of the left side of a car
Link between the two systems
Generally, a person identify himself as a “System 2 person” due to the fact that system 2 is connected with making choices and decisions and controlling his thoughts. But the truth is that System 1 is responsible for the initial concept of thinking that leads to the deliberate choices of the second system. Even though System 1 is accountable of generating convoluted ideas and plans, System 2 is in charge of constructing organized thoughts and plans. As Kahneman described in his book, both of them have their own operations, abilities, and limitations but when it comes to the control of attention, it is shared. Kahneman refers to System 2 as lazy and reluctant to make bigger effort than the one that is needed. This is the main reason that several misunderstandings occur, since System 2 often is guided by System 1 when simultaneously System 2 believes that it owns these decisions. Another difference between them is that System 2 has the ability to comply with the rules, make comparisons within attributes and make a decision between options when System 1 has none of these abilities because of its automatic nature.
Application
The dual-system thinking in project management tasks is mainly applied in the decision-making phase or in general in project manager’s behavior. It is worldwide known in the management scientific area that the decision-making phase is the cornerstone of a successful project. Project managers make several decisions during the project life cycle and thus they have to be extra cautious during this procedure. Biases and other numerous influences contribute to the final decisions [2]. In this part, the two-type thinking makes its entrance by analyzing the phenomena below.
Anchoring Effect and Adjustment
D. Kahneman refers to the Anchoring Effect as “the human tendency to consider a specific value for an unknown quantity before estimating that quantity”. People’s judgments are mostly influenced by an uninformative number. The anchoring effect can be found in both systems. In more detail, anchoring effects are closely related to judgement tasks and choices that System 2 is responsible for. System 2 operates and works with tasks that are retrieved from memory or experience inside the System’s 1 automatic environment. That makes System 2 more vulnerable to the anchor’s effect and unable to control it. It is really important for a project manager to apply the Kahneman’s strategy of “adjust-and-anchor” which consists of the following steps: start from an anchoring number, assessment of the possibility of having too high or too low values, adjustment of the initial estimation by trying to be distanced from the “anchor”. For example, a project manager with experience in public projects, estimates the duration of a medium project, based on his experience on large scale projects (step one), then he tries to assess the possibility of a false time planning (step two) and finally he adjusts his experience to the current data (step three). However, there are plenty examples of insufficient adjustments which lead to unsuccessful projects and failures. This is a characteristic of a weak System 2 that highlights the importance of the knowledge of the dual-system thinking to project management applications.
Predictions
A Project Manager has a lot of responsibilities in a project lifecycle such as forecasting future advantages or failures. One of them could be during the risk management phase. Many of the predictive judgments rely on the excessive knowledge of the environment that a project is part of it and observations on similar occasions. According to Kahneman, most of the judgements are influenced by a mixture of analysis and intuition. The link between the evidence and the predictive target is crucial, but indirect. System 2 is prone to rejecting irrelevant or false information even though System 1 is not capable of adjusting for smaller weaknesses. System 2 is responsible for correcting the intuitive predictions even if it makes the task or the project more complicated.
