What MSPs Should Know About the Dunning Kruger Effect

There’s a psychological phenomenon known as the ‘Dunning-Kruger Effect’. This cognitive bias (discovered by social psychologists David Dunning and Justin Kruger at Cornell University in 1999) is a paradox where people with low ability at a task overestimate their ability, while experts tend to underestimate theirs.

That’s not to say this effect comes as a result of overall intelligence or wisdom, but rather to their competence in specific domains.

An individual might be highly knowledgeable about molecular biology, for example, but not know much about first-aid. If that person tries to administer first-aid without the necessary skills or training, they might overestimate their ability to do so successfully because they don’t fully understand the complexity or risks of the task, which can be dangerous in this instance. This is the Dunning-Kruger effect in action.

Another example could include a novice driver believing they drive better than anyone else on the road, but a seasoned Formula 1 racer, aware of the complexities and risks, self-evaluates more conservatively. That’s the Dunning-Kruger Effect. It arises from a metacognitive inability of those unskilled to recognise their own ineptitude. They’re not just overconfident; they simply lack the knowledge to assess their competence accurately.

To an onlooker, this effect can appear to be sheer arrogance and be highly frustrating, unless they themselves are aware of the effect and can see it for what it is and then put it into perspective and hopefully develop the people-skills to work around it.

So, to this end, how does this affect a Managed Service Provider (MSP)? And how can understanding the Dunning-Kruger Effect contribute to increased profits?

Firstly, recognising this bias in potential customers can help in marketing and sales strategies. Some small to medium-sized businesses might believe they have their IT infrastructure completely under control, when in reality, they might be overlooking critical elements such as cybersecurity, data backups, or network efficiency. This is where the Dunning-Kruger Effect is in play.

An MSP can create marketing content that respectfully and subtly highlights the complexities of IT management. This can help potential clients recognise the gaps in their understanding and appreciate the value a professional MSP offers.

Secondly, within an MSP’s workforce, promoting a culture of continuous learning can guard against the Dunning-Kruger Effect. Ensuring your team members don’t become complacent, but instead are always expanding their expertise and aware of their learning edges, maintains high service quality. This directly translates into customer satisfaction and hence, higher profits. So, by understanding the Dunning-Kruger Effect, an MSP can better leverage their marketing to overcome it in their clients and prospects.

Furthermore, being aware of this effect can help managed service providers guard against complacency via training and CPD programmes and so overall, turning this psychological insight into a competitive advantage.