project management dangers of over optimism

At the same time, those who performed the best on the two tests somewhat underestimated how well they would do they thought they would do OK but ended up doing better. The students who performed least well on the tests strongly overestimated how well they would do they thought they would do great. Over 20 years ago, two researchers – David Dunning and Justin Kruger – asked university students to estimate how well they would perform in upcoming tests. The Dunning-Kruger effect is a psychological theory suggesting that people can be poor predictors of their own performance. It is optimism that causes such surprise when the investments are later exposed as fraudulent Ponzi schemes, and the investors lose their money. It is because of optimism that people can be convinced to invest in financial schemes that promise to make an incredible return on their money. While optimism can be a crucial ingredient for success, over-optimism can be an ingredient for failure.

(Image courtesy University of Southern California Libraries, California Historical Society) However, while optimism is important for success, organizations must also understand how over-optimism can be an ingredient for failure, leading to delayed projects, budget overruns or even safety incidents. The drilling industry has been characterized by optimism since its earliest days, driving a spirit of innovation and resilience that allowed companies to extend drilling from land out to the shallow sea and then out into deepwater.

None of this progress would have been possible without verve and optimism. The advances in the oil and gas industry have matched the technological progression of the space industry. The drilling industry is a story of tenacity and innovation, from its early days of land drilling, then pushing the boundaries to use piers to drill just a little off the land’s edge and at the beginning of the shallow sea, and finally deepwater drilling around the globe. Words like drive, grit and resilience are all rooted in optimism. In fact, research has shown that optimism helps people to be successful at home, in business and on the sports field. In general, people are moderately optimistic and feel hopeful about life. By Jared Dempsey, Kognivate, and Tim Wigham, Exceed Performance

Project management dangers of over optimism