Executive Leadership – Can we Trust ‘Realistic Optimism’

There is much executive discussion around ‘realistic optimism’, which is the ability to balance out negative and positive things in situations, circumstances and people.
It is the courage to explore opportunities, where others are blocked by risk and failure, with the belief that the future will be better than the past.

Optimism bias is defined as the difference between a person’s expectation and the outcome that follows. If expectations are better than reality, the bias is optimistic; if reality is better than expected, the bias is pessimistic, according to Cell Press something that 80% of the global population possess to some degree.

Thinking positively is an evolutionary hallmark, because it facilitates envisioning what is possible, allowing us to be courageous and innovative. Levels of optimism bias vary according to our mental state and current circumstances, and there are ways to temper or increase it.

That’s good, because a surfeit of optimism can lead to underestimating risk. Understanding where you sit on the optimism spectrum can help you adjust for your bias – and maybe even make better choices.

At the root of optimism bias are two assumptions: first, that we possess more positive traits than the average person; second, that we have some kind of control over the world around us.

Despite unexpected negative events happening to us – or seeing them on the news – it is the positive events that tend to leave the biggest impression on our belief systems. We simply “learn better” from good things happening around us, which perpetuates the bias. Bad things tend to be given less credence, and some people ignore them altogether.

An overabundance of optimism, however, can lead to an inadequate assessment of potential hazards. A common example is planners underestimating budgets and timeframes. It could also mean failing to take out insurance, or not wearing a helmet while cycling – or maybe even catching illness through complacency or neglect.

Optimism bias occurs with equal prevalence across the global population, but culture plays a role by influencing how optimistic or pessimistic people consider themselves. In cultures in which optimism is considered a good thing, such as the US and Australia, people are more likely to self-identify as optimists.

Optimism is also linked to success in multiple domains, whether it’s business, politics, or sports. CEOs tend to be more optimistic than the average person, as are entrepreneurs, whose optimism increases further once they take the leap into starting their businesses.

American psychologist Martin Seligman teaches people to cultivate a more optimistic viewpoint by ascribing permanent causes to positive things and temporary ones to negative things. A person may say, ‘That project went well because I am a good engineer’ or ‘That project failed because I didn’t put enough time into it’.

The message is that good things happen for reasons inherent to the individual, while bad things are attributed to causes that can be remedied, such as last-minute preparations. This cultivates a positive self-view that makes us optimistic about our future prospects.

Many studies have been carried out about the effectiveness of optimism as a psychological phenomenon, leading to various theoretical formulations of the same concept, conceptualized as “disposition”, “attributional style”, “cognitive bias”, or “shared illusion”.

This overview is an attempt to explore the “optimism” concept and its relations with mental health, physical health, coping, quality of life and adaptation of purpose, health lifestyle and risk perception.

Positive and negative expectations regarding the future are important for understanding the vulnerability to mental disorders, in particular mood and anxiety disorders, as well as to physical illness. A significant positive relation emerges between optimism and coping strategies focused on social support and emphasis on positive aspects of stressful situations.

Through employment of specific coping strategies, optimism exerts an indirect influence also on the quality of life. There is evidence that optimistic people present a higher quality of life compared to those with low levels of optimism or even pessimists.

Optimism may significantly influence mental and physical well-being by the promotion of a healthy lifestyle as well as by adaptive behaviours and cognitive responses, associated with greater flexibility, problem-solving capacity and a more efficient elaboration of negative information.

We have all heard the adage of the glass being half full or half empty to determine if someone skews toward being an optimist or pessimist. But perhaps there’s a third option: realist. While pure optimists and pure pessimists simply accept (or reject), realists tend to take action.

A realist looks at the glass and says, “Hey, there’s a glass with some liquid in it.” Where a pure optimist may be completely happy with the amount that’s in the glass, and a pure pessimist may be disappointed, pure realists don’t judge – they accept, observe, and question: “Is this the right amount for me right now?”; “Is this the right glass for me?” If it’s not, then they take action.

However, like most things, optimism and pessimism are on a spectrum, with realistic thinking in the middle. So, you can have realistic pessimists and realistic optimists the difference between the two is that realistic optimists have the ability to be hopeful that they can change things for the better. They believe they’ll succeed but understand that doing so will take work.

As human beings, we can practice integrative awareness before, in, and after the moment. Beforehand, we can visualize the expected external event and our potential internal response. After the event, we can reflect and process the experience, let go of stress, and gain insight. In the moment, we can observe ourselves while having the experience and regulate our behaviour at the same time.

Captain Chesley Sullenberger brought the process of integrative awareness alive when he landed his commercial plane in the Hudson River in 2009. After a bird strike cut both engines of his commercial flight soon after take-off, Captain Sullenberger demonstrated the ability to stay calm while facing fear.

Instead of returning to the airport as air traffic controllers were advising, he paused and assessed that he couldn’t make it, landing instead in the river and saving the lives of all on board. The balancing of emotions with a rational and deliberate thought process is something scientists call metacognition.

By practicing internal awareness on two levels (having the experience and observing it at the same time), you can catch early signals of distress, doubt, or fear without acting out a stress response. This is especially critical in times of crisis. While we can never be purely objective, we can try to reach that state as much as possible.

Without objective awareness, signals of distress can trigger “survival” behaviour, and we lose the ability to pause, reflect, and decide. For a leader during crisis, this survival state can present a huge risk, and in the case of Captain Sullenberger, it would have been fatal.

In a crisis, some leaders react to complex problems with polarizing opinions, quick fixes, false promises, or overly simplistic answers, often combined with a command-and-control leadership style. They lose their ability to be in dialogue, to continuously adapt, and to look for novel solutions.

In a situation where their experience falls short, but without the ability to practice integrative awareness, they may be guided by their fear and resort to habitual responses, often unconsciously biased, to unfamiliar problems.

Another risk of not being aware of our internal world is found in “sacrifice syndrome”: leaders who face constant pressure do not find time to take care of themselves, leading to reduced effectiveness and exhaustion.

Successful Leadership requires optimism and realism. While we need Leaders to not sugarcoat problems when communicating with Employees, any harsh realities need to be balanced with inspiring perseverance about the organization’s future.

But it’s not only our Leaders’ responsibility to balance reality and optimism … it’s something every employee should do. Really, it’s something we should do in every aspect of our lives. Why?

According to an article on WebMD, realistic thinking helps us be present by focusing on reality and not hypotheticals. It’s also shown to improve overall wellbeing because realistic thinking allows you to create “reasonable expectations for yourself and those around you that will help you live a less stressful life…

When you train yourself to rationalize and think critically about the situation, you’re more likely to expect reasonable outcomes. This will set you up for better thoughts and mental health in the future.”

Dr. Martin Seligman, former president of the American Psychological Association and legendary researcher in the field of optimism, discovered that optimism or pessimism lies in the way you explain the events that happen to you. Such “automatic thoughts” often cause us to assess events inaccurately and jump to erroneous conclusions.

Unrealistic optimism is defined as believing that you are more likely to experience pleasant events than is actually the case, and less likely than others to experience negative ones. It can keep you from being able to change direction when you are unable to see the trouble that lies ahead.

So, when it comes to optimism or pessimism, “hope for the best, prepare for the worst” is an ideal motto. To achieve that you must be honest with yourself about your usual approach to life. Discover the ways in which your past may be distorting your present.

Doing this can transform your grip on the truth for the better. By far the greatest cause of the emotional disturbances that make us avoid reality is our childhood relationships with our parents. Surprisingly few people have an understanding of the true role they played in their family, let alone of the extent to which suffered early maltreatment.

Final word, positive expectations are good; optimism leads us to look for new challenges and work on the things we have control over. On the other hand, we should remember the importance of being realistic and be aware of the line between constructive optimism and pop psychology positive thinking. Have positive expectations about the future, but do not get into the habit of sweeping reality under the rug or distorting it.

Otherwise, you might be caught off guard when negative things happen. We should also evaluate to what extent the situation can be changed and act accordingly. If there are situations or conditions you cannot change, it’s better to accept them rather than relying on false optimism. Lastly, remember that being “very optimistic” might not necessarily result in the best outcomes in every situation. It might be balance that keeps us going.

We never know, but creating the illusion of predictability is easier than you may think. We have the ability to remove the illusion that we know what the world will look like in the coming months or years. And we have the ability to have a plan and act despite these objective limitations.

When we face the dilemma of what will become the basis for our decisions and actions, a pessimistic or optimistic vision of the future, it is worth remembering that we do not have to function in this dichotomy. There is still realistic optimism, which takes into account all the circumstances based on a realistic expectation.

Sandrea L. Schneider PhD and Professor once stated on the subject.

“When our hopes for performance are not completely met, realistic optimism involves accepting what cannot now be changed, rather than condemning or second-guessing ourselves.
Focusing on the successful aspects of performance (even when the success is modest) promotes positive affect, reduces self-doubt, and helps to maintain motivation (e.g., McFarland & Ross, 1982)….

Nevertheless, realistic optimism does not include or imply expectations that things will improve on their own.

Wishful thinking of this sort typically has no reliable supporting evidence. Instead, the opportunity-seeking component of realistic optimism motivates efforts to improve future performances on the basis of what has been learned from past performances.”

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