What is counter-factual thinking and how does it impact the workplace?

Counterfactual thinking is a term of psychology that describes the tendency people have to imagine alternatives to reality. Humans are predisposed to think about how things could have turned out differently if only..., and also to imagine what if?. This should never be confused with lessons learned, as these practices are based on fact.

The best way of looking at how this type of thinking can impact any work environment is in the word itself. The prefix "counter" means opposite. The suffix "factual" means a state of fact. Bringing this type of thought process to your profession can lead to basing outcomes on information that is the opposite of fact.

In business we rely heavily on factual information as a metric for success. Counterfactual thinking is an inherent trait that often leaves people stuck in the past. It is difficult to achieve success when dwelling on the what if's and if only's.

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Counterfactual thinking, or what is sometimes called the, "Wait; if only...", occurs when we imagine how things might have turned out. When something happens -- especially something significant -- we think about alternatives to our current reality in order to place that event in context.

Counterfactual thinking sometimes makes us feel good about where we are in comparison to where we could be. And sometimes it makes us feel worse. Either way, we do a lot of comparing: Between where we are and where we could have been... both positively and negatively.

Counterfactuals occur in the workplace as well – for example, during performance evaluations. "Research shows the majority of performance appraisals have zero impact on performance," says James Adonis (an expert on employee engagement). "One reason for this is that appraisals are often laborious. When both employees and managers dread them, they can't ever be effective. And another reason can be attributed to counterfactuals."

For example, when you give an employee a less than perfect rating, it's natural for him to think about what could have been. If he uses a downward counterfactual that's great, because he's happy. But if he uses an upper counterfactual he may become angry or resentful and definitely won't feel good about his performance. And he'll probably only remember those feelings of disappointment and not any of the specific and constructive feedback you provide.

The key is to minimize upper counterfactuals whenever possible. That way employees will not only be more open to suggestions for improvement but will also be more likely to accept -- and remember and feel good about -- the positive feedback they receive.

Here's James' advice:

To minimize upper counterfactuals before an appraisal:

• Eliminate surprises. Hold enough feedback sessions in the months leading up to the appraisal so that employees can accurately predict what they'll hear during the appraisal. (If I'm surprised by formal feedback, that's your fault -- not mine.)
• Set clear expectations. Ensure employees completely understand how their performance will be measured. The more they know about what you expect, the more likely they are to be objective about their own performance... and the less likely they will be to have mistaken impressions that cause them to use upward counterfactuals.
• Ask questions. Have honest conversations to explore what your employees expect. Then you can correct incorrect impressions or perceptions in advance -- or at the very least be prepared to deal with them.

Here's how to deal with upper counterfactuals when they happen during an appraisal:

• Don't argue or debate. If an employee gets emotional, let him vent. (Sometimes all we want is to be heard.)
• Paraphrase what is said to prove you listened and understood.
• Ask further questions to learn about the underlying reasons for how the person feels. The more you know, the better you can respond -- and sometimes empathize.
• If necessary, refer to previous discussions when you talked about performance issues.
• Be prepared to concede that maybe... just maybe... your feedback is inaccurate. It does happen.

In short, be fair, be honest, be straightforward, and consider not only the feedback you will give but also the impact -- especially in counterfactual terms -- of that feedback on each employee. When you do, your employees won't need to reach the top of the podium to feel they're winners -- and to walk away motivated to keep improving.

Counter factual thinking is thinking about a past that did not happen. This often happens  in 'if only...' situations, where we wish something had or had not happened.

This can be so powerful we can change our own memories, adjusting the facts and creating new memories. It can happen to cover up trauma or may be just excuses to avoid facing uncomfortable truths. It can also be to explain what is otherwise unexplainable.

Of course greatly affect

It is kind of creative thinking/lateral thinking which introduce untradtional solutions.