Outcome bias
Researchers have tested this many times, in different places, over many years, and they keep finding the same result. This one is safe to trust.
Researchers gave people descriptions of decisions along with the information available at the time, then told them how things turned out. The information behind the decision was held constant. Only the outcome changed. People rated the same decision as wiser, more competent and more responsible when it happened to work out, and worse when it did not. They were judging the result and calling it judgment. Nassim Taleb illustrates the same point with a thought experiment. Imagine someone offered ten million dollars to play one round of Russian roulette. He plays, survives, collects, and is profiled as a bold decision maker. Run the possible worlds side by side and in five of six he is rich, in the sixth he is dead. A terrible decision produced a wonderful outcome, and the outcome is the only thing anyone can see.
You are judging the quality of decisions by how they turned out, and so is everyone around you. That trains people to gamble, because the reckless bet that pays off gets rewarded and the sound analysis that met bad luck gets quietly punished. Keep it up for a few years and you have taught a whole team that boldness beats care. The correction is to separate the two questions and ask them in order. Was this a good decision given what was known at the time, and separately, did it work out. Sometimes the honest answer is that a good decision lost. If your organisation has no way to say that sentence out loud, it will keep promoting luck. Memory makes this harder than it sounds, because hindsight bias quietly rewrites what you believed at the time.
Hindsight bias rewrites your memory of what you predicted, so the outcome feels like it was always obvious. Outcome bias rates the decision itself by how it turned out, even with identical information about how it was made. They arrive together in every post-mortem and they need different fixes. Hindsight is beaten by writing the prediction down before the result is known. Outcome bias is beaten by asking two questions in order: was this a good decision given what was known, and separately, did it work. The written note is what makes the first question answerable.
Source: Baron and Hershey, Outcome Bias in Decision Evaluation, Journal of Personality and Social Psychology, 1988. Successfully replicated in 2021 and again in 2023. The Russian roulette illustration: Taleb, Fooled by Randomness, 2001.
Nassim Nicholas Taleb, 2001
On the histories that did not happen, and how completely we ignore them when judging the one that did.
Draw your own card. It does not take long, and it rewards taking your time.