Many people overestimate their own qualities and abilities, while simultaneously underestimating those same qualities and abilities in other people. This is known as Illusory Superiority. Researchers NW Van Yperen and BP Buunk coined the term back in 1991. This sense of relative superiority is also referred to as the Lake Wobegon effect, named after a fictional town in NPR’s Prairie Home Companion show which closed with, “That’s the news from Lake Wobegon, where all the women are strong, all the men are good looking, and all the children are above average.”
This bias leads to overconfidence and a lack of self-awareness. As a result, we tend to overestimate our capabilities as leaders, particularly the higher up the ladder we climb. Studies by organizational psychologist Tasha Eurich showed the more power a leader held, the more likely they were to overestimate their skills and abilities. One study of over 3,600 leaders across roles and industries suggested high-level leaders significantly overvalue their skills relative to low-level leaders in 19 out of 20 competencies measured.
Most of us suffer from this type of self-deception. Or is it self-delusion? Not being as attractive, capable, or creative as we think we are can be a buzzkill. And as Daniel Kahneman pointed out, being aware of your cognitive biases doesn’t necessarily mean you’ll overcome them and make better decisions. Yet the optimism of GI Joe, “Now you know, and knowing is half the battle.” can still give us a glimmer of hope.