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Hofstadter’s Law and the Planning Fallacy

Jan 9, 2021 | Business & Life Advice

Hofstadter’s Law and the Planning Fallacy? Back to school with this quote from a Project Management teacher that illustrates Hofstadter’s law perfectly:

“When you think it is going to take one month, and you think it’s a conservative estimate, say it’s going to take three months because surely unexpected things will happen.”

The suggested factor of 3 is undoubtedly a bit arbitrary, but I have to say, he is so right in the idea. Even when knowing it will take more time than you think, most of the time, a cognitive bias tends to make us underestimate the adequate time it will require. This human planning bias is an illustration of the Planning Fallacy and Hofstadter’s Law.

What is Hofstadter’s Law?

Hofstadter’s Law states that “It always takes longer than you expect, even when you take into account Hofstadter’s Law.”

Conceived by the cognitive scientist Douglas Hofstadter, Hofstadter’s Law is particularly relevant to time and project management, productivity, and software development. Hofstadter’s Law is applicable to situations where complex tasks are involved and falls into the Planning Fallacy phenomenon.

The Planning Fallacy phenomenon has been well-documented by psychologists:  Task duration estimates will fall – more often than not – short of the actual time required – even when the time allotment is increased to compensate for the human tendency to underestimate it.

Hofstadter’s Law and the Planning Fallacy – Illustration

Hofstadter's Law - Planning Fallacy Example

What does Hofstadter’s Law mean?

Hofstadter’s Law is a thorough statement of the extreme difficulty of accurately estimating the amount of time it will take to complete complex tasks. This extreme difficulty leads most of the time to effective task durations being longer than the worst estimates.

Hofstadter’s Law and the Planning Fallacy – Video from Valorian

Hofstadter’s Law and the Planning Fallacy – Real-Life Examples (Source: Wikipedia)

The Sydney Opera House

It was expected to be completed in 1963. A scaled-down version opened in 1973, a decade later. The original cost was estimated at $7 million, but its delayed completion led to a cost of $102 million.

The Berlin Brandenburg Airport

After 15 years of planning, construction began in 2006, with the opening planned for October 2011. There were numerous delays. It was finally opened on October 31, 2020. The original budget was €2.83 billion; current projections are close to €10.0 billion.

The planning fallacy is that you make a plan, which is usually a best-case scenario. Then you assume that the outcome will follow your plan, even when you should know better.” – Daniel Kahneman Quotes

Why does Hofstadter’s Law occur more often with complex projects?

It occurs more often because the more complex a project is the more steps there are from start to completion. Each step increases the risk of  hitting a drawback and for a delay to occur.

Why is Hofstadter’s Law recursive?

Hofstadter’s Law is recursive by nature as it calls itself in a never-ending way: That is, even after you have taken Hofstadter’s Law into account, by Hofstadter’s Law, you must still take Hofstadter’s Law into account, and this remains true no matter how many times you have already applied Hofstadter’s Law.

The recursive nature of Hofstader’s Law is the way Douglas Hofstadter suggests to account for the things you don’t know, even if you don’t know them. It is therefore technically impossible to ever fully take Hofstadter’s Law into account.

How to apply Hofstadter’s Law if it contains a Recursive Rule?

Like the Pareto Law or 80/20 Rule, Hofstadter’s Law has a recursive component. Using the Pareto Law as an example, 20% of products sold by a company can make 80% of its profits. Using a recursive approach, 4% of the products sold (20% of the first 20%) would make roughly 64% of the profits (80% of the first 80%). That’s pure theory. We already know that the 80/20 Rule doesn’t perfectly hold all the time anyway. What ultimately counts with the Pareto philosophy is to focus on an outcome’s main drivers rather than the exact numbers. That’s the same thing with Hofstadter’s Law.

In practice, nothing can replace common sense and lesson-taught from past experiences. In a project management context, trust first what past actual data tells you for a similar task. A systematic approach to project planning and estimating task duration would be running a Pareto Analysis on tasks already completed with delays. A Pareto Analysis of the project tasks durations would yield the common root-causes for these delays. No time for such project analysis? Get your Excel Pareto Analysis sorted in one-click with this Excel-Add-In!

Be cautious with computed estimations made with fancy calculations in a spreadsheet or program. While they may look perfect from a theoretical point of view, they cannot be relied upon if they don’t include fair adjustments to include history and provisions for “lesson learned” delays. Be pragmatic. Remember that perfectionism is very bad for business, and nothing can replace experience.

Conclusion and Suggestions

In software development, the 90/90 Rule from  Tom Cargill is also a “popular” statement that also falls into the Planning Fallacy category. The Planning Fallacy a common phenomenon and is another good reason to focus in priority on the most valuable or important tasks for any given project. In short, it shows that prioritization methods such as the Eisenhower Matrix method or Pareto Analysis are among the best time-management tools. For more Business & Life articles with a productivity mindset approach, visit the blog of ParetoAnalysis.tools.

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Hofstadter’s Law and the Planning Fallacy

Hofstadter’s Law falls into the Planning Fallacy category by stating “It always takes longer than you expect, even when you take into account Hofstadter’s Law”.

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