Discounting – How we stay stuck with denial

May 12, 2021


Have you seen phenomena such as the following

  • A leader receives a 360 feedback report with scathing comments, but says, “The report was not useful. There was nothing new.”
  • A leader when asked to talk about her accomplishments says, “I don’t know what to say,” even when everyone else can see what a trailblazer she has been
  • A leader does not delegate even though she is very thinly stretched
  • A leader tries experimenting once and fails, and then says, “I will never take risks like this again.”

The psychological processes underlying these can be very well understood through the Transactional Analysis concept of Discounting. In English, discounting means reduction in the value of something. In Transactional Analysis, discounting is defined as unawarely minimising, maximising, ignoring or distorting information relevant to the solution of a problem.

What do people discount?

People discount themselves, other people, and situations. Here are some examples

Discounting self: I can’t do anything in this situation (Feels unskilled or unimportant)

We could discount ourselves in the following ways:

  • Discounting own knowledge and ability – I am just an employee here
  • Discounting own responsibility in relation to a role – How can I disagree with my boss?
  • Discounting feelings – I am not upset that he resigned abruptly (while being upset)
  • Discounting intuition /thoughts – I wish I had said it then
  • Discounting your impact on others – Does what I say really matter?

Discounting others: There is no point telling Alex. She will never change. (Reduces another’s abilities, responsibilities, feelings, intuitions and impact)

Discounting the situation: It is not going to rain here, (even when there are heavy clouds right above).

When people discount the situation, they refuse to see what is going on. They may ignore immediate relevant information, or ignore the context, findings of science, expert opinion, world realties etc.

When people discount others or the situation, they also discount themselves.

Why do people discount?

Our perceived inability to do something or understand what is going on is usually based on some old personal decision about our lack of power. Personal power is the ability to recognise what we and other people need and to take action on that information. Power misused is exploitative. Positive power is action taken to care for our own needs and the needs of the others. But for some of us, at an early age, it was not safe to act in a way that looked powerful or wise, or to be honest about what we saw in families. So we learnt to deny or discount. Some discounts have only small negative effects, but some are deeply serious. The ideas in this blog can make us aware of our own patterns of discounting and learn to step out of the same.

How do people discount?

People discount by making something more, less, or different than it really is. Discounting is a distorted thought process. When we discount, we deny our responsibility for responding appropriately to a current reality. By discounting, people can redefine a problem, situation, or need, so they believe they don’t have to do anything about it or so they can do less than is needed. By discounting, we keep ourselves from acting responsibly. We keep ourselves powerless.

Let us look at the following challenges, and identify what is being discounted.

Naina is with her boss at a café. She asks for Expresso, but the waiter brings her a cappuchino. The boss asks her if she wants to return the coffee but she says, “No it is OK,” feeling very low about herself.
Naina is minimising Her needs, her feelings
Naina is maximising (making larger in her mind) The trouble that her ask would create for her boss or for the waiter
Naina is distorting (reading meaning) “This always happens to me. I am so useless”
Naina is ignoring Her own Adult resources to ask for what she wants
Utpal’s CEO is coming from the US. Utpal asks his peer, “Should I let hell break loose by giving him the raw data? Or should I sugar coat it?’
Utpal is minimising His CEO’s capacity to deal with the raw data in a mature manner
Utpal is maximising (making larger in his mind) His own importance in the equation. Perhaps the CEO already knows.
Utpal is distorting “Hell will break loose” – Perhaps good things will emerge
Utpal is ignoring His responsibility – The CEO needs to know what is going on.
Sumathi is on a holiday with friends. While everyone enjoys themselves, she manages all the logistics – books tickets, organises lunches and plans the entertainment. She feels resentful that she is loaded but at the same time doesn’t ask others to pitch in
Sumathi is minimising Her need to have fun and be close to people.
Sumathi is maximising (making larger in his mind) Her skills as an organiser, her responsibility
Sumathi is distorting “Nobody cares” “They’ll say yes, but they won’t do it.” But others may be willing to share in the responsibility and actually do a good job. And nothing will happen if things aren’t organised perfectly.
Sumathi is ignoring Her capacity to ask for help

What are the four levels of discounting?

We can find out more about how we discount and how to stop discounting by looking at the methods people use to discount. We’ll refer to these as levels of discounting. They are described in the book Cathexis Reader 2 by Jacqui Lee Schiff and others.

Level 1: Discount the existence of the situation, problem, or person. “That’s no problem.”

In this level we don’t recognise something that can be seen, heard, smelt, touched, sensed or experienced – in other words ignoring a very sensory stimulus, “What idea? Nobody said anything.”

Level 2: Discount the severity of the problem. “That’s no biggie.”

Level 3: Discount the solvability of the problem. “You can’t fight the government.”

Here we fail to recognise options we have to deal with the situation, “Nothing can be done.”

Level 4: Discount your personal power to solve problems. “Nothing I can do about that,” or “I wouldn’t feel comfortable doing something about that.”

Here we fail to recognise our own and other people’s responsibility to play a part in dealing with the situation.

Discounting and Change

Discounting keeps us stuck in problems. To change we need to account for the existence of problems, see them as significant, recognise the availability of options and take personal responsibility for the change.

The levels of discounting help us see how deeply we are stuck. If a person discounts a problem at the level of existence, then working with the person on taking personal responsibility for change will yield no results. Can we see why so many performance feedback meetings yield no results ?

Julie Hay (1995) proposed a model for change based on discounting that she called Steps to Success. This model helps us assess the level at which discounting may be happening and proposes a method to ensure that discounting is addressed at that level . When someone is discounting, the focus needs to be on the stage before the level that they are discounting. It may even be necessary to go back to the level of existence of information before they can progress to options or personal responsibility. When we skip a step we invite people to engage in passive behaviour. The changes may not happen or may not sustain.

How Deep is the Discounting? Questions to ask at this stage, before moving to the next stage Example of discounting at this level Ways to move out of discounting at this level
Step 1 – Situation

What is the issue that we are all working with?

Do all parties agree that there is an issue?

Does everyone who is involved in the change plans have a similar picture of all the facts?

A manager is dissatisfied with the way the team conducts meetings. The team members do not yet share his view on the functioning of the team. Not everyone is on board that there is an issue The first step is for the manager to invite awareness about his perceptions of the functioning of the team and check if they see the situation similarly.
Step 2 – Significance

Does every person give the same meaning to the situation at hand? Is it sufficiently important for everyone to warrant action?

If not, then work needs to be done to arrive at a balanced consensus of the seriousness of the situation.

Example: The team now sees that some things could have been better here and there, but members still don’t have the motivation to think about solutions. Not everyone is on board that things need to change. The manager at this stage invites thinking around why the data is significant and why the team must take action.
Step 3 – Solution

Is there agreement that change is possible?

Or are people saying, “There are no options.” Or “We have tried this before.” Or “It will never work.”

If this happens, then the group needs to return to step 2 and establish the why of the change.

Now that the team is convinced that the meetings can be different and better, it is now able and willing to work with the manager to think about solutions The manager and team brainstorm together on ways to resolve the problem
Step 4 – Skills Do all those who are going to implement the change also have the information and skills needed? People want to change and they recognise what could be done, but they don’t have the skills to make the change. The team may need to be trained on effective meeting behaviours
Step 5 – Strategy Along which route and what degree of planning will the change be achieved? This is the stage where decisions need to be made about who will do what and when. People are aware of options and they have the skills, but they don’t really put down a plan for change. They don’t act on effecting the change. If they are not willing and confident, then the previous levels have to be returned to. After having thought of options and after training, the team members create a checklist of effective meeting behaviours. They use the checklist to give each other feedback and hold each other accountable.
Step 6 – Success This is the stock taking stage. Has the change that was undertaken actually been effected? If yes, how is the success of the team actually going to be celebrated? The team makes the change, but no one explicitly acknowledges the change or invites celebration The team acknowledges that they now have successful meetings. they celebrate by going out for a fun evening followed by dinner.

The energy to tackle the next development often stems from celebrating a previous success. In TA terminology, celebrating pertains to collecting a sufficient number of strokes. A result can be transformed into success by actually celebrating it

Assessing the levels of discounting at each step of the change process can be time consuming, but it pays off as it offers likelihood of success. Rushing forward prematurely, gives the illusion of progress, only for people to discover later that no action took place around the change. All of these levels of discounts need to be discussed in a non-threatening way for people to feel safe to share their inhibitions. Their discounts of themselves, others or the situations need to be respectfully challenged.


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