Psychology

The Dangers of Categorical Thinking

We’re hardwired to sort information into buckets—and that can hamper our ability to make good decisions.

by

Bart de Langhe

and

Philip Fernbach

by

Bart de Langhe

and

Philip Fernbach

From the Magazine (September–October 2019) · Long read

Bruno Fontana

Summary.

Human beings are categorization machines, taking in voluminous amounts of messy data and then simplifying and structuring it. That’s how we make sense of the world and communicate our ideas to others. But according to the authors, categorization comes so naturally to us that we often see categories where none exist. That warps our view of the world and harms our ability to make sound decisions—a phenomenon that should be of special concern to any business that relies on data collection and analysis for decision making. Categorical thinking, the authors argue, creates four dangerous consequences. When we categorize, we compress category members, treating them as more alike than they are; we amplify differences between members of different categories; we discriminate, favoring certain categories over others; and we fossilize, treating the categorical structure we’ve imposed as static. In the years ahead, companies will have to focus attention on how best to mitigate those consequences.

Idea in Brief

The Problem

We all think categorically, and for good reason: It helps us make sense of the world. But in business, categorical thinking can lead to major errors in decision making.

The Fallout

When we categorize, we compress category members, treating them as if they’re more alike than they are; we amplify differences across categories; we discriminate, favoring certain categories over others; and we fossilize, acting as if the structures we’ve imposed are static.

The Solution

Thoughtful leaders can avoid the harm that comes from categorical thinking in four ways: by ensuring that everybody understands the dangers of categorization, by developing ways to analyze data continuously, by questioning decision-making criteria, and by actively “de-fossilizing” categories.

Say ta. Say da. Now repeat the sounds, in each case paying attention to how you’re making them in your mouth. What’s the difference?

A version of this article appeared in the September–October 2019 issue of Harvard Business Review.

BL

Bart de Langhe is an associate professor of marketing at ESADE Business School, Ramon Llull University, in Barcelona.
PF

Philip Fernbach is a marketing professor at the Leeds School of Business, University of Colorado Boulder, and a coauthor of The Knowledge Illusion: Why We Never Think Alone (Riverhead Books, 2017).

The Dangers of Categorical Thinking

Idea in Brief

The Problem

The Fallout

The Solution

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