Prediction Errors – Are you able to celebrate mistakes?

Understanding Prediction Errors is key to improving decision-making and fostering a Growth Mindset. Research shows that when our expectations are not met, there is a huge opportunity for learning—whether the outcome is better or worse than anticipated.

How Prediction Errors Work

Every decision we make carries an expectation of reward or punishment. The actual outcome can fall into one of three categories:

1. Expected Outcome – No change required; behaviour remains the same.
2. Positive Prediction Error – The result exceeds expectations, reinforcing the current behaviour.
3. Negative Prediction Error – The outcome is worse than expected, offering an opportunity to adjust and improve.

Why Negative Prediction Errors Drive Learning

Many people ignore negative prediction errors, dismissing them as failures. However, these moments hold the greatest potential for growth. When faced with an unexpected negative outcome, ask:

• What didn’t work?
• Why didn’t it work?
• How can we adapt and improve?

By embracing these questions, individuals and teams can turn setbacks into valuable learning experiences, strengthening their Growth Mindset and enhancing performance.

Applying Prediction Errors to Your Team

Encouraging a culture where learning from mistakes is valued can significantly improve decision-making and team development. If you’d like to explore this further, we offer workshops and exercises designed to help teams leverage these errors for growth and success.

You can watch more of our short videos here.

With best regards,

David Klaasen

Talent4Performance help business leaders clarify complexity. We inspire people and drive continuous performance improvement, so they can convert thinking into action and results.

©David Klaasen – 2025