Retrospective Distortion happens when we look back on a decision and distort our evaluation of the decision by relying on today’s knowledge. Since we know the outcome we are now able to assign the proper probabilities to all the unknowns that went into making the decision. We attribute today’s knowledge of the probabilities to the decision-maker in the past. We discount the history of the decision-maker in similar circumstances, and his or her deep tacit understanding⁺ of the circumstances at the moment of the decision. Retrospective Distortion gives a distorted perspective of the individual making the decision – attributing failure (or success) where it’s not (or is) merited. This embitters decision makers or conversely gives the illusion of accomplishment and entitlement. Both are detrimental to team esprit de corps and passions.

Retrospective Distortion was the most frequently mentioned behavior during the pharmaceutical industry survey⁺: Monday morning quarterbacking.

• You promoted an individual under the false pretense of his or her contribution to the success of the project – to the detriment of the other members of the team who have a true sense of the contribution.
• You killed a good project (fired a good employee) because you did not appreciate the heroic efforts the team (the employee) took to overcome the organizational hurdles that you put in their way.
• You acknowledge you made a fundamentally flawed decision, but blame your team for not giving you the contrary evidence, evidence for which you have unwittingly nurtured a culture of suppression.

Retrospective Distortion is about the human capacity to rationalize any decision or action, combined with the facility to assign responsibility to others when things go wrong. We miscalculate the facts available to the decision-maker retrospectively⁺, even when we are the decision-maker.