Highlights

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Hindsight. Narratives generated after a certain result emerges typically downplay alternative scenarios that could have happened but didn’t.

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Correlation mistaken for causation. Stories can suggest causality between contemporaneous and correlated events, even when such a link doesn’t actually exist.

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Myopia. Some stories fail to spot an existing relationship when causes and effects are far apart in time.

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Expiration. Stories are based on the past, so they can quickly become obsolete when situations change suddenly and dramatically. However, the traditions built on them often persist beyond those expiration dates.

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Anecdotes. It’s appealing to induce overarching stories from personal experience and striking episodes. However, these are just small samples that tend to be unrepresentative. In fact, given wide ranging variabilities in circumstances and personalities, the more unique an observation, the less likely it is to generalize.

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Survivors. Learning from success stories is both fun and motivating. Analyses of the common traits of successful people and organizations are ubiquitous. However, this approach overlooks the fact that these same traits may be equally prevalent in the not-so-successful. Especially when the success rate is low, stories tend to emphasize how uniquely talented and hardworking the successful are. Yet they conveniently ignore scores of failures with similar skills and work ethics, who didn’t achieve the same level of success for all sorts of circumstantial and random reasons.

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Outcomes. Stories often focus on observable outcomes while ignoring underlying processes. One consequence is a widespread blindness to possible deceptions and unethical behaviors that contributed to those outcomes. There’s an extensive list of long-running and popular stories based solely on successful outcomes that eventually revealed their dark sides. These cases involved Ponzi schemes, opioid crises, and fraudulent business practices, among other transgressions.

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Narratives on creativity typically glorify the final versions of successful ideas along with a few flashy creators, while ignoring most of the underlying intricate collaborative processes conducted by scores of risk-taking entrepreneurs. As a result, innovation seems more individualistic and deterministic than it really is.

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some stories can feature a combination of them. They may, for instance, focus exclusively on the successful outcomes of a few surviving anecdotes with the benefit of crystal-clear hindsight. The more warning signs a story shows, the more skepticism is warranted.