“Noise” – Why Human Judgement Sucks

Books, Psychology / By /
The book "Noise" standing on a wooden garden desk in front of an old, French house

Noise – A Flaw in Human Judgement by Daniel Kahneman, Cass R. Sunstein and Olivier Sibony

How would you react if I told you that the length of the prison term, a convicted felon could get, depends on whether the judge had lunch before the trial or whether the local sports team had won the night before? Sounds unfair, doesn’t it? Well, sadly, it is true. 

But judges are not the only ones whose judgements depend on the time of the day or on whether the Lakers beat the Clippers. Flaws in human judgements extend into the business world, education, government, hospitals and right into your and my home. 

Noise – Unwanted Variability (or in sexy: a mess)

Noise is about the unwanted variability in human judgements. When two judges (not necessarily a judge in the court room) evaluate the same matter, have the same information, but derive at vastly different conclusions, there is said to be noise.

Kahneman, Sunstein and Sibony elaborate on why noise is such a big problem (only look at the prison term case above) how and why it occurs and ultimately how we can reduce it. 

You might be familiar to bias in judgments. When a judge’s decision tends to favor a certain gender for example – then the judge is said to be biased. 

Noise is much less observable, which is why it’s harder to reduce. But it too, comes with high costs – in terms of money, time, energy, or unjust prison term length. But treating it, argue the authors, can be easier than you think.

Think about what 10% better judgements would do to your life. You and I judge every day. Multiple times. At school, at university, at the office, at home, when we are with family. Some judgements are more important than others. But what if all of them just get a tiny bit better?

What would 10% better judgements do to the course of a business? I think we can agree it would lead to much more productive and efficient work.

That is why noise matters. 

Noise can be an invisible problem, even to people whose job is to see the invisible

from Noise by Daniel Kahneman, Cass R. Sunstein and Olivier Sibony

Reading Noise isn’t Easy

Noise is Daniel Kahneman’s second behavioral science book, after the international bestseller “Thinking, Fast and Slow” – which you will soon find on this blog, too. 

Kahneman didn’t win the Nobel Prize in Economics for no reason. His books are massively insightful. But not easy to read. Compared to other books of the same genre, Kahneman can break down statistical concepts, psychological principles into easier words – easier, not easy.

Noise is a hard read. It took me longer than usual to get through the book. But that shouldn’t discourage you from reading it. I want to offer some suggestions for how to approach books like Noise.

How to Read Noise – Some Ideas

Chapter by chapter. I took notes, highlighted, and looked up questions. Trying to understand what I could. You don’t have to get everything. Just understanding one key learning is enough I believe. Just one major takeaway.

So how can this be done?

I took notes while reading and did a little break after every other chapter to just let them sink in. Give yourself some time to think about what you have read.

I am not saying to take a 15-minute break every 40 pages. Make it small. A couple minutes might do the trick. Doing some elaboration on what you have read should make it more memorable. Try to avoid the phone right after reading – the chapters will be out of your head immediately.

Each Books Purpose

After reading Noise I decided to try out something new: Write down a concrete purpose of why I am reading a book before starting. This should ultimately be the one key takeaway that I want to have answered at the end.

For Noise this purpose could look like this: “I am reading Noise to get specific ideas on how to improve noise and bias in the meetings that I lead at work”. For my current book (The $100 Startup) it is: “I am reading the $100 Startup to get concrete ideas on how to fully incorporate The Reading Dilemma into my day and continue to grow it.”

You’ll automatically apply everything you read to this goal and will be more likely to take notes and remember them. Sure, some stuff will become less important, but that is okay. You can always read the book again with a different purpose in mind.

It also serves as a reminder. If you right the purpose down on the first page, you can always go back. 

You can also apply the approach to fiction books. You might not have a key learning from a fiction book – some clearly do – but you can still have a purpose of reading it. Maybe you want to relax and regenerate a bit from work. Great! You have your purpose. Now you need to make sure that the environment and circumstances when reading the book are right, so that you can achieve your purpose. Once again, writing the purpose before reading serves as a great reminder. Try it out and let me know how it works for you.

My Purpose of Reading Noise

I didn’t have a purpose when reading Noise. That’s why it took me longer than other books and why it sometimes felt like I didn’t get everything out of it. But you can do better. 

I am convinced that the method above is a great way to tackle this problem. It doesn’t take much time and helps you suck out the knowledge you need from the books you read.

A Major Takeaway

Humans are dumb and even simple algorithms or basic rules and guidelines produce better judgements. We tend to be highly inconsistent in our judgements and overestimate their accuracy by quite a bit.

This fact is highly interesting though. What if you could build a blueprint to use algorithms or a set of simple rules, for many different judgements? That would reduce noise and save cost. 

Teachers could then apply this blueprint to grading exams, doctors could apply it when evaluating patients and business leaders could use it to evaluate projects or employees. I have no idea whether this is at all possible, but it would come with immense upside and potential. Like I said, highly interesting…

Some (almost) Final Thoughts

The first four parts of Noise are theory. Theory of noise, bias, psychology, statistics. But they are also full of stories of how noise affects us every day. The last two parts are specific suggestions on how to reduce noise – varying in complexity and cost. 

The entire book is magnificent. But if you don’t want to read through the theory, the last two parts will still give you a lot of insights as well. And the theory won’t run away – you can still read it later.

Why Reading Noise is Worth It

We make hundreds of judgements every day. Improving them can have a big payoff. This doesn’t concern the judgment whether to put Cheese or Peanut Butter on your sandwich. It’s about the ones that truly matter. The big ones – like the fair length of a prison term.

It’s worth taking some time to understand the logic behind our judgment and be radically open-minded to the possibility of regularly flawed judgements of our own. The benefits will last a lifetime.

So don’t get scared by me saying that this is a tough read. Take on the challenge if you feel this book could help you out. And if it feels like it can’t, I feel like your judgement might be flawed quite a bit.

Enjoy!

Joe

Have you enjoyed this post? Please let me know if so. I am happy to get in contact with you if you have any ideas, suggestions, book tips or if you want to share your story. 

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Thinking, Fast and Slow by Daniel Kahneman is another great book in the field of economics and psychology. But you might also enjoy Nudge, by Kahneman co-author of Noise, Cass R. Sunstein and Richard Thaler.

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