What change are you leading? What resistance are you encountering? The people you mean to lead and whose lives you are attempting to improve are strangely immune to the prospects of that better life. Most people tend to stay with what they already have, even if it's not that great, rather than make a jump to something that seems obviously better but remains unproven. You are in the business of change. An understanding of how loss aversion in your target audience creates a drag in your progress can help you nurture the support you need to succeed.

If you make shit, think shit up, sell shit or help people with their shit, you're a leader. As leaders we are always proposing something to someone. Family members, staff, vendors, investors, clients. You might think that you have the most awesome shit every created, but most of the time, most of the people you propose to are saying some version of no.

Change feels risky and uncomfortable to the people buying into it.

Daniel Kahneman and Amos Tversky developed Prospect Theory as a way to validate their intuition that people are not entirely rational when making decisions. Kahneman would go on to win the Nobel prize in economics for this contribution to behavioral economics . One of the features of new Prospects is that the possibility of gain has consistently less value to people than avoiding the threat of loss.

People make irrational choices based on self-doubt, fear and ego.

I shared the same intuition long before I discovered the work of Tversky and Kahneman. I began my work in the personal growth industry selling personal growth courses. I noticed that when people were deciding on whether to sign up for the course to make a proposed lifestyle change or stay with what they already had, they were more likely to tip towards the status quo. They also seemed quite happy to share their objections to obvious progress. This never really made sense to me but there was no practical way to know what sort of value they'd receive from a program that was inherently experiential.

I developed this matrix to help people overcome their natural aversion to change and loss. I uncovered the matrix watching hundreds of people do screwy math before my very eyes. The thesis is pretty simple. People have a natural and unconscious decision bias. When contemplating some sort of change most of the people I met would underestimate the benefit of the change, overestimate the cost of making the change, underestimate the cost of not making the change and overestimate the benefit of not making the change. They made their decisions and raised their objections without a full appreciation of what the decision was really about.

Not making a change is often riskier than making it.

When I led people through a more fulsome consideration of the costs and benefits of both taking action and not, more of them took the leap. And for those that didn't accept my proposal, I felt better about their choice and more at peace proceeding without them.

Unconscious bias requires conscious choice.