Paranoia implies some degree of irrational fear or concern and that actually works against situational awareness. Situational awareness implies detailed observation and cool headed assessment. This leads to better decision making.
Someone who is paranoid starts to imagine things or does sort of a worst case analysis. While it is useful to be safe and not underestimate how badly things can go wrong, overcompensating by projecting your fears leads to poorer and less optimal decision making.
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