I’m pulling together some research for a longer post, but I came across a paper which merited a separate look by itself. Blanchflower and Oswald’s 2005 paper looked at reported satisfaction of folks in a range of countries, as a counterpart to the Human Development Index (HDI). Although Australia ranks highly on the HDI (now 2nd per the most recent data), they found that Australia performs poorly on a range of happiness indicators, particularly job satisfaction. Are we flipping the old stereotypes and becoming whinging Aussies, or are there other effects at play?
Empirical studies have shown for decades that General Mental Ability (GMA) is the best predictor of job performance suitable for common use. Unlike other high performing measures, GMA can be readily established through standard testing. Certain personality effects such as conscientiousness also have substantial correlations with job performance and can provide useful additional information to recruiters evaluating candidates. Instead, there is a stubborn reliance on intuitive methods such as unstructured interviews which have much poorer accuracy. In fact, new research shows that including unstructured interviews can actually drive overconfidence in recruiters while impeding accuracy if used in combination with more precise methods such as GMA testing.
There are many scenarios in our business or personal lives in which we need to evaluate the competence of another person. This might be an investor evaluating a financial advisor, a recruiter interviewing a candidate, a voter choosing a politician, a consumer judging a salesperson or one of any number of other scenarios. In these cases, the evaluator will lack detailed knowledge of the particular subject area, which would mean that they, (like President Trump) do not have the ability to distinguish competence. Without being able to distinguish competence, studies have shown that evaluators of advice will fall back on confidence which is only loosely correlated with actual ability. So until such time as informaton about the accuracy of the advisor is made clear, confidence will rein over competence for the layperson’s thinking.
We all have understandings of our own strengths and weaknesses, abilities and expectations, forming a self-image, or a mental model of the person we are. But these often become hardwired, with a whole bunch of cognitive effects together with the difficulty in getting objective information making it rather difficult to re-evaluate your own understandings. Outdated beliefs in your own ability or lack thereof can act to drive your career in suboptimal directions or inhibit your confidence, as well as impacting on your own direction in the world. I’m going to run through an example which has belted this home for me and inspired this post.