The Fine Line Between Confidence and Overconfidence

Can you believe yourself into a success, or at least a role as a leader?

Yes, you can, if you believe a study out of the University of California’s Haas School of Business. The study finds that overconfidence is commonly found in the business world, and many people have used it to get them where their talent wouldn’t have taken them.

The study found that some people tend to believe they are more physically talented, socially adept, and skilled at their jobs than they actually are. It also found that this overconfidence can have detrimental effects on their performance and decision-making.

“Our studies found that overconfidence helped people attain social status,” says Cameron Anderson, an associate professor at the Haas School and co-author of the study.

“People who believed they were better than others, even when they weren’t, were given a higher place on the social ladder. And the motive to attain higher social status thus spurred overconfidence.”

What that really means is that you probably bought the notion that you could become anything you wanted to be when you mother told you that as a child. That might have been your first step into overconfidence.

This higher social status is reflected in the respect, prominence, and influence individuals enjoy in the eyes of others. In work groups, higher status individuals tend to be more admired, listened to, and have more sway over the work group’s discussions and decisions.

These alphas of the group have more clout and prestige than other members. Anderson says these research findings are important because they help shed light on a longstanding puzzle: why overconfidence is so common, in spite of its risk.

Anderson says the study’s findings suggest that falsely believing one is better than others has profound social benefits as well. In addition, it is one reason why people are so often promoted over their more competent peers.

“In organizations, people are very easily swayed by others’ confidence, even when that confidence is unjustified,” he says. “Displays of confidence are given an inordinate amount of weight.”

Yet, even when confidence can be a sign of a person’s actual abilities, a surplus of confidence often can backfire. Believing in your abilities when they are substandard can cause bad management and decision-making that can scar companies long past the tenure of the flawed leader.

This raises the question, is it healthier to believe you have extraordinary abilities when you don’t, or is it actually better to have an accurate handle on your abilities and perform according to that standard?

The answer to that question rests with each individual. Many people have driven themselves to greater achievements because others have displayed confidence in them, or because they have a natural confidence.

But scarcely a worker has not come across at least one manager or supervisor whose skills are truly lacking. When companies don’t identify and correct those situations, they are sowing the seeds of workplace unrest and poor performance.