Tag: Survivorship Bias

You’re Only As Good As Your Worst Day

We tend to measure performance by what happens when things are going well. Yet how people, organizations, companies, leaders, and other things do on their best day isn’t all that instructive. To find the truth, we need to look at what happens on the worst day.

“Anyone can steer the ship when the sea is calm. ”—Publilius Syrus

We laud athletes on a winning streak, startups with a skyrocketing valuation, hedge funds seeing record-breaking returns, and so on. But it’s easy to look good when everything goes according to plan and circumstances are calm. Anyone can succeed for a while, even if it’s just out of pure luck. It’s no great feat to do well if you’re not being challenged or tested. Watching what happens during a downswing is far more instructive.


Products and services are only as good as they are when they break, not when everything is functioning fine.

When a program stops working, do you face a baffling error message with no further guidance or clear instructions for how to get help? Is customer service quick and easy to access at any time or does it require you to jump through endless convoluted hoops? Even if you’ve had a positive view of a product or service for years, a problem that takes forever to fix or a hostile response when you ask for help will no doubt make you take your business elsewhere.

From a customer standpoint, companies are only as good as how they behave in a public relations crisis.

Do they shirk blame and try to pin it elsewhere or do they take responsibility? Do they try to cover up what happened or do they come forward with the full truth? Do they ignore any damages or do they promise to make things better for everyone affected—no matter the cost? Reputations are fragile. One incident of bad behavior will linger in the minds of customers for a long time.

From a financial standpoint, companies prove their worth when they show how they cope when something fundamental changes in the market or there’s a financial crisis.

Do they keep persisting with the old business model under the illusion that what worked before should work again or do they reimagine their approach? Do they fire staff to preserve CEO bonuses or do they play the long game to ensure they’ll be able to attract top talent in the future? Do they crumble when there’s a powerful new competitor or do they rise to the challenge? Like companies, investors might be able to perform well in ideal conditions due to luck. But when the market crashes and there’s blood in the streets, very few will know how to cope or be prepared. Only the smartest will know how to survive or even profit.

Leaders are only as good as how they lead during times of uncertainty and fear.

Do they hide away from public sight or do they serve as a reassuring, sympathetic presence that brings everyone together? Do they do what’s defensible or what’s best for everyone in the long run? Are they forced to react in the moment or were they already prepared? Ask anyone to name the finest leaders in the history of their country and they’re not likely to name those who were in power during calm, peaceful times. They’ll name those who were at the helm during wars, economic crises, pandemics, natural disasters, and so on—those who never wavered from a vision and whose consistent, empathetic appearances gave people a sense of hope.


As individuals, we tell people the most about who we are when everything goes wrong. These times are also when we stand to learn the most about ourselves.

Your kids might not remember how you behaved on a relaxed, sunny Saturday when work went well all week and you had little on your mind beyond playing with them. But they’re sure to remember how you behaved on the day when you’d lost your job due to a recession, you’d just had an argument with your partner, an unexpected bill arrived in the mail that morning, and then someone spilled spaghetti sauce on the couch. That’s the day when your behavior has the most to show them about what to model in the future.

Your partner might not remember how you treated them when you were lying on a beach on holiday together with all of your worries far away and a good book in hand. But they’re sure to remember how you treated them when you had your worst disagreement ever, over a problem that seemed insurmountable and involved complex emotions. That’s the moment when they might well make a decision about whether they’re in this for the long haul.

Your boss might not remember the work you did on an average week when everything went to plan. But they’re sure to remember the time when you stepped up, stretched the limits of your abilities, and delivered what seemed impossible at short notice while everything around you was on fire. That’s what they’ll recall when thinking about what you’re capable of.


You’re only as good as your worst day. Not because what you do the rest of the time doesn’t matter. Not because you should be expected to be perfect under immense stress or to behave according to plan when everything goes awry. But because what you do on your worst day is impossible to fake. It’s honest signaling. There’s little time for posturing or stalling. On your worst day, you reveal whether you’ve been planning for the possibility of disaster or just coasting along enjoying the good times. Your plans and preparation (or lack thereof) show how much you really care about the people who depend on you. You get to build and strengthen bonds in ways that will last a lifetime, or you risk destroying relationships in moments. You get to build trust and respect or you might break what you have irreparably.

Your worst day is a chance to show your best qualities, to stand out, and to learn an enormous amount about yourself. Very few people plan or prepare for what they’ll do and how they’ll act during those times. Those who do might well end up turning their worst day into their best.

What Sharks Can Teach Us About Survivorship Bias

Survivorship bias refers to the idea that we get a false representation of reality when we base our understanding only on the experiences of those who live to tell their story. Taking a look at how we misrepresent shark attacks highlights how survivorship bias distorts reality in other situations.

When asked what the deadliest shark is to humans, most people will say the great white. The lasting influence of the movie Jaws, reinforced by dozens of pop culture references and news reports, keeps that species of shark at the top of the mind when one considers the world’s most fearsome predators. While it is true that great white sharks do attack humans (rarely), they also leave a lot of survivors. And they’re not after humans in particular. They usually just mistake us for seals, one of their key food sources.

We must be careful to not let a volume of survivors in one area blind us to the stories of a small number of survivors elsewhere. Most importantly, we need to ask ourselves what stories are not being told because no one is around to tell them. The experiences of the dead are necessary if we want an accurate understanding of the world.


Before we drill down into some interesting statistics, it’s important to understand that great whites are one member of a class of sharks with many common characteristics. Great whites are closely related to tiger and bull sharks. They all have similar habitats, physiology, and instincts. They are also all large, with an average size over ten feet long.

Tiger and bull sharks rarely attack humans, and to someone being bit by one of these huge creatures, there isn’t all that much difference between them. The Florida Museum’s International Shark Attack file explains that “positive identification of attacking sharks is very difficult since victims rarely make adequate observations of the attacker during the ‘heat’ of the interaction. Tooth remains are seldom found in wounds and diagnostic characters for many requiem sharks [of which the great white is one] are difficult to discern even by trained professionals.”

The fatality rate in known attacks is 21.5% for the bull shark, 16% for the great white, and 26% for the tiger shark. But in sheer volume, attacks attributed to great whites outnumber the other two species three to one. So there are three times as many survivors to tell the story of their great white attack.


When it comes to our picture of reality of the most dangerous shark, there are other blind spots. Not all sharks have the same behaviors as those three, such as swimming close to shore and being around enough prey to develop a preference for fat seals versus bony humans. Pelagic sharks live in the water desert that is the open ocean and have to eat pretty much whatever they can find. The oceanic white tip is a pelagic shark that is probably far more dangerous to humans—we just don’t come into contact with them as often.

There are only fifteen documented attacks by an oceanic white tip, with three of those being fatal. But since most attacks occur in the open ocean in more isolated situations (e.g., a couple of people on a boat versus five hundred people swimming at a beach), we really have no idea how dangerous oceanic white tips are. There could be hundreds of undocumented attacks that left behind no survivors to tell the tale.

One famous survivor story gives us a glimpse of how dangerous oceanic white tips might be. In 1945, a Japanese submarine shot down the USS Indianapolis. For a multitude of reasons, partly due to the fact that the Indianapolis was on a top secret mission and partly due to tragic incompetence, a rescue ship was not sent for four days. Those who survived the ship’s sinking had to then try to survive in the open ocean with little gear until rescue arrived. The water was full of sharks.

In Indianapolis: The True Story of the Worst Sea Disaster in US Naval History and the Fifty-Year Fight to Exonerate an Innocent Man, Lynn Vincent and Sara Vladic quote Boatswain’s Mate Second Class Eugene Morgan as he described part of his experience: “All the time, the sharks never let up. We had a cargo net that had Styrofoam things attached to keep it afloat. There were about fifteen sailors on this, and suddenly, ten sharks hit it and there was nothing left. This went on and on.” These sharks are believed to have been oceanic white tips. It’s unknown how many men died from shark attacks. Many also perished due to exposure, dehydration, injury, and exhaustion. Of the 1,195 crewmen originally aboard the ship, only 316 survived. It represents the single biggest loss of life from a single ship in US naval history.

Because humans are rarely in the open ocean in large numbers, not only are attacks by this shark less common, there are also fewer survivor stories. The story of the USS Indianapolis is a rare, brutal case that provides a unique picture.


Our estimation of the shark that could do us the most harm is often formed by survivorship bias. We develop an inaccurate picture based on the stories of those who live to tell the tale of their shark attack. We don’t ask ourselves who didn’t survive, and so we miss out on the information we need to build an accurate picture of reality.

The point is not to shift our fear to oceanic white tips, which are, in fact, critically endangered. Our fear of sharks seems to make us indifferent to what happens to them, even though they are an essential part of the ocean ecosystem. We are also much more of a danger to sharks than they are to us. We kill them by the millions every year. Neither should we shift our fear to other, more lethal animals, which will likely result in the same indifference to their role in the ecosystem.

The point is rather to consider how well you make decisions when you only factor in the stories of the survivors. For instance, if you were to try to reduce instances of shark attacks or try to limit their severity, you will not likely get the results you are after if you only pay attention to the survivor stories. You need to ask who didn’t make it and try to figure out their stories as well. If you try to implement measures aimed only at great whites near beaches, your measures might not be effective against other predatory sharks. And if you conclude that swimmers are better off in the open ocean because sharks seem to only attack near beaches, you’d be completely wrong.


Survivorship bias crops up all over our lives and impedes us from accurately assessing danger. Replace “dangerous sharks” with “dangerous cities” or “dangerous vacation spots” and you can easily see how your picture of a certain location might be skewed based on the experiences of survivors. We can’t be afraid of a tale if no one lives to tell it. More survivors can make something seem more dangerous rather than less dangerous because the volume of stories makes them more memorable.

If fewer people survived shark attacks we wouldn’t have survivor stories influencing our perception about how dangerous sharks are. In all likelihood we would attribute some of the ocean deaths to other causes, like drowning, because it wouldn’t occur to us that sharks could be responsible.

Understanding survivorship bias prompts us to look for the stories of those who weren’t successful. A lack of visible survivors with memorable stories might mean we view other fields as far safer and easier than they are.

For example, a field of business where people who experience failures go on to do other things might seem riskier than one where people who fail are too ashamed to talk about it. The failure of tech start-ups sometimes feels like daily news. We don’t often, however, hear about the real estate agent who has trouble making sales or who keeps getting outbid on offers. Nor do we hear much about architects who design terrible houses or construction companies who don’t complete projects.

Survivorship bias prompts us to associate more risk with industries that exhibit more public failures. But the failures from industries or businesses that aren’t shared are equally important. If we focus only on the survivor stories, we might think that being a real estate agent or an architect is safer than starting a technology company. It might be, but we can’t only base our understanding on which career option is the best bet on the widely shared stories of failure.

If we don’t factor survivorship bias into our thinking we end up in a classic map is not the territory problem. The survivor stories become a poor navigational tool for the terrain.

Most of us know that we shouldn’t become a writer based on the results achieved by J.K Rowling and John Grisham. But even if we go out and talk to other writers, or learn about their careers, or attend writing seminars given by published authors, we are still only talking to the survivors.

Yes, it’s super inspiring to know Stephen King got so many rejections early in his career that the stack of them was enough to pull a nail out of the wall. But what about the writers who got just as many rejections and never published anything? Not only can we learn a lot from them about the publishing industry, we need to consider their experiences if we want to anticipate and understand the challenges involved in being a writer.



The next time you’re assessing risk, ask yourself: am I paying too much attention to the great white sharks and not enough to the oceanic white tips?

Survivorship Bias: The Tale of Forgotten Failures





— Cicero

The Basics





— Daniel Kahneman

Cause and Effect




Beware of advice from the successful.

— Barnaby James

Survivorship Bias in Business











Consider What You Don’t See






The Art of Thinking Clearly

Rolf Dobelli’s book, The Art of Thinking Clearly, is a compendium of systematic errors in decision making. While the list of fallacies is not complete, it’s a great launching pad into the best of what others have already figured out.

To avoid frivolous gambles with the wealth I had accumulated over the course of my literary career, I began to put together a list of … systematic cognitive errors, complete with notes and personal anecdotes — with no intention of ever publishing them. The list was originally designed to be used by me alone. Some of these thinking errors have been known for centuries; others have been discovered in the last few years. Some came with two or three names attached to them. … Soon I realized that such a compilation of pitfalls was not only useful for making investing decisions but also for business and personal matters. Once I had prepared the list, I felt calmer and more levelheaded. I began to recognize my own errors sooner and was able to change course before any lasting damage was done. And, for the first time in my life, I was able to recognize when others might be in the thrall of these very same systematic errors. Armed with my list, I could now resist their pull — and perhaps even gain an upper hand in my dealings.

Dobelli’s goal is to learn to recognize and evade the biggest errors in thinking. In so doing, he believes we might “experience a leap in prosperity. We need no extra cunning, no new ideas, no unnecessary gadgets, no frantic hyperactivity—all we need is less irrationality.”

Let’s take a look at some of the content.

Guarding Against Survivorship Bias

People systematically overestimate their chances of success. Guard against it by frequently visiting the graves of once-promising projects, investments, and careers. It is a sad walk but one that should clear your mind.

Pattern Recognition

When it comes to pattern recognition, we are oversensitive. Regain your scepticism. If you think you have discovered a pattern, first consider it pure chance. If it seems too good to be true, find a mathematician and have the data tested statistically.

Fighting Against Confirmation Bias


Dating Advice and Contrast


Think Different

Fend it off (availability bias) by spending time with people who think different than you do—people whose experiences and expertise are different from yours.

Guard Against Chauffeur Knowledge

Be on the lookout for chauffeur knowledge. Do not confuse the company spokesperson, the ringmaster, the newscaster, the schmoozer, the verbiage vendor, or the cliche generator with those who possess true knowledge. How do you recognize the difference? There is a clear indicator: True experts recognize the limits of what they know and what they do not know.

The Swimmer’s Body Illusion

Professional swimmers don’t have perfect bodies because they train extensively. Rather, they are good swimmers because of their physiques. How their bodies are designed is a factor for selection and not the result of their activities. … Whenever we confuse selection factors with results, we fall prey to what Taleb calls the swimmer’s body illusion. Without this illusion, half of advertising campaigns would not work. But this bias has to do with more than just the pursuit of chiseled cheekbones and chests. For example, Harvard has the reputation of being a top university. Many highly successful people have studied there. Does this mean that Harvard is a good school? We don’t know. Perhaps the school is terrible, and it simply recruits the brightest students around.

Peer Pressure

A simple experiment, carried out in the 1950s by legendary psychologist Solomon Asch, shows how peer pressure can warp common sense. A subject is shown a line drawn on paper, and next to it three lines—numbered 1, 2, and 3—one shorter, one longer, and one the same length as the original one. He or she must indicate which of the three lines corresponds to the original one. If the person is alone in the room, he gives correct answers because the task is really quite simple. Now five other people enter the room; they are all actors, which the subject does not know. One after another, they give wrong answers, saying “number 1,” although it’s very clear that number 3 is the correct answer. Then it is the subject’s turn again. In one-third of cases, he will answer incorrectly to match the other people’s responses

Rational Decision Making and The Sunk Cost Fallacy

The sunk cost fallacy is most dangerous when we have invested a lot of time, money, energy, or love in something. This investment becomes a reason to carry on, even if we are dealing with a lost cause. The more we invest, the greater the sunk costs are, and the greater the urge to continue becomes. … Rational decision making requires you to forget about the costs incurred to date. No matter how much you have already invested, only your assessment of the future costs and benefits counts.

Avoid Negative Black Swans

But even if you feel compelled to continue as such, avoid surroundings where negative Black Swans thrive. This means: Stay out of debt, invest your savings as conservatively as possible, and get used to a modest standard of living—no matter whether your big breakthrough comes or not

Disconfirming Evidence

Munger Destroy ideas

The confirmation bias is alive and well in the business world. One example: An executive team decides on a new strategy. The team enthusiastically celebrates any sign that the strategy is a success. Everywhere the executives look, they see plenty of confirming evidence, while indications to the contrary remain unseen or are quickly dismissed as “exceptions” or “special cases.” They have become blind to disconfirming evidence.

Still curious?

Read The Art of Thinking Clearly.