88 - Two principles I aim to follow moving forward:


personal development

_The way to a (wo)man’s mind is through stories. _

There’s a photograph doing the rounds. A middle-aged man is holding the hand of his 15-year-old dead daughter as he sits surrounded by rubble in Kahramanmaras, close to the epicenter of the devastating earthquake that hit Turkey and Syria on Monday.

It’s a poignant image but it is our reading of it that is most telling. This one picture and the story behind the picture can do more for earthquake relief efforts than all the stats thrown together. That’s a bold claim to make but one backed by behavioral science.

Humans are not perfectly rational agents who are always looking at the utilitarian value of their choices. Those agents of cold reason are called Econs. They don’t exist. If anything, Humans are known to be perfectly irrational. We show a consistent slant toward certain things. One of those things is vividity.

For Humans,

Vivid > Accurate

Memorable > Thorough

The pain of a mourning father holding the hand of his dead teenage daughter is evocative. More so possibly than the collective pain of thousands of those who have lost families to the earthquake.

The phenomenon at work has a name: psychic numbing. In the case of the earthquake, it reads: the more who die the less we care.

The idea behind psychic numbing may be old but it was Paul Slovic who first codified and proposed it. Here he is talking about it on a podcast from a couple of years back:

And what they [Kahneman and Tversky] showed was this function wasn’t a straight line. It was kind of a curved thing. The biggest effect on our valuation is when we go from zero to one, from no lives at risk to one life. One life at risk is very important to us and people will risk their own lives to save a single person nearby who was in danger, so that life is very valuable. But then if there are two lives at risk, the value function is not straight. It’s not linear. It starts to curve over. And two isn’t twice as big as one. As the numbers increase, it starts to get flatter and flatter.

And the problem is with our feelings…. So one of the problems with feelings is that our feelings can’t count. They’re innumerate. And here’s where we get back to the value function [getting flatter and flatter]

What function is Slovic talking about? The prospect theory. A product of the work of Daniel Kahneman and Amos Tversky, prospect theory says three things: losses pinch us more than twice as much as gains make us happy, our sensitivity diminishes with the size of loss or gain, and the reference point to which we compare our losses and gains to matters (that is, the same loss or gain can be perceived differently depending on our reference point).

Here’s Slovic again explaining his point in a way anyone can understand, with or without prior knowledge of prospect theory:

I can illustrate that very simply. So the difference between zero lives at risk and one is huge, as I mentioned earlier. And [having] two people at risk doesn’t feel twice as concerning as one. We already are pretty concerned with one. And two maybe we’re more concerned, but not twice as [much]. And then let’s suppose that I say, okay, now there are 87 people at risk. And then I say, oh, wait a minute. I made a mistake. There’s 88 people. It’s not 87, it’s 88. You won’t feel any different thinking about 88 lives at risk than 87, even though there’s an additional valuable life there. It shows the inability of the feeling system to differentiate quantity as the numbers increase, the same thing with money. If you find a hundred dollars, it will make you happy. If you see a hundred dollars on the street. If you find 200, you won’t feel twice as happy.

Why are we desensitized to scale? Because the apparatus of the human brain would break if we were to maintain our sensitivity. If we remained progressively susceptible. Early man evolved to hear the rustle of leaves nearby because that could mean clear and present danger. It didn’t help our fitness if we heard ear-splittingly loud blasts better than moderately loud ones.

The striking thing is that psychic numbing isn’t restricted to numbers or sensory perception. It extends to how we value changes in wealth and happiness and learning. Our emotions don’t scale.

Why am I telling you this?

At various points in my journey as a creator and writer, I’ve heard others who’ve been doing the same but for much longer talk up novelty and utility. What you say must be new and it must be useful to people.

Much of the domains of behavioral science, consumer psychology, and decision-making is new to the mainstream consciousness. They are not taught as subjects in schools and colleges and readers are often being introduced to them in their 20s or beyond. Someone like Rory Sutherland is so fascinating to listen to simply because we have never heard anyone remotely similar. That’s going from 0 to 1. That’s going to make a big bang.

But it would be a mistake to say that simply serving new and useful ideas would do the trick for someone else. Rory Sutherland is Rory Sutherland. He’s an authority in the field. He has skin in the game. Not everyone has that.

There’s a third dimension. Memorability.

That takes us right back to that image of the mourning father.

The mourning father is an identified life. The unseen thousands are statistical lives. ‘Identified’ and ‘statistical’ come from the 1968 essay The Life You Save May Be Your Own by economist Thomas Schelling.

We get drawn to an identified life when it is brought to us. We feel a sense of duty to give our attention to this one grieving father. But, of course, the montage of thousands of bereaved statistical fathers rolls by every day and we don’t appear to care. These lives perish every day for want of not much–drinking water, toilets, antibiotics–and yet we remain unmoved.

This trait of ours is fundamental. It affects how we help, whether we jump in and roll our sleeves up or stay back and turn up our nose.

It also decides how we learn.

Gaurav Singh recently wrote about his experience of running a cohort-based course for young managers. I quote him here:

When I learn a new concept, I start with its history & base research.

But this didn’t work in the course.

Example: Situational Leadership

In early cohorts, I started with its 4 decade history & main research.

I wanted to generate buy-in but mostly generated boredom.

Then I changed my approach. I shared stories of:

→ A managee who was ‘unwilling‘ to do the work

→ One who was ‘willing but unable’

→ Another who was ‘willing, able & confident’

I showed how they all needed different support & Situational Leadership taught me how to give that.

The chat blew up.

People shared how they could relate to these examples & were now excited to try Situational Leadership.

So I overhauled the course.

I still point them to the research & history behind each concept.

But most time is spent in the world of stories & examples.

Whether within the confines of a cohort-based course or outside in the broader virtual world, the volume of content continues to double every year (called Zuckerberg’s law). Most of this is the equivalent of statistical content. It is unidentified. We treat it as such. We find our feeds, our inboxes, our minds snowed under and we simply shovel the stuff out.

Just because we can hook ourselves straight into the minds of experts of any persuasion doesn’t mean that we will do so. Certainly, nobody’s getting out of bed, clapping their hands Jerry-Mcguire style, and announcing ‘Today I’m going to learn about decision-making.’ That’s an audience of zero.

Most times, when people are learning something new, they’re testing waters. What they’re looking for is something to latch on to. ‘Ah, this is interesting’ they say and peer closer.

Remember that,

Vivid > Accurate

Memorable > Thorough

What this distillation means is simple. Make things memorable. Make ideas, concepts come alive by weaving them into stories. Experiment with structure, with format. Invite your audience, immerse them.

That’s what I see ahead, dear reader, and it is my intent to keep pushing in this direction of making what I share memorable.

Which leads me to the second principle I want to follow.

Deliberate practice is the difference between a 71-year-old retired expert and a 32-year-old seasoned pro.

Why do we need a lifetime to gather wisdom? Why can’t we achieve the same in a tenth of the time? No, I’m not floating the boat of productivity. I’m exploring, as many more (here and here) qualified than me have done before, learning modalities.

There’s a 900-page handbook that has contributions by more than 100 ‘leading scientists who have studied expertise and top performance in a wide variety of domains: surgery, acting, chess, writing, computer programming, ballet, music, aviation, firefighting, and many others’ that says experts are made, not born.

The scientists agree on another thing. It is not how many hours that you spend learning but how you spend those hours that makes the difference. Deliberate practice builds expertise faster and better than any other way.

Let’s stay on this for a moment.

Ethan Mollick, who teaches entrepreneurship at Wharton, writes in his wonderful newsletter:

For deliberate practice to be truly effective, learners must bring their full focus and engagement to the task at hand. This can be challenging, as the work required is often difficult and demanding. Failure is common. In fact, one of the key aspects of deliberate practice is that it embraces failure as an opportunity for growth.

Now, let me add some color to difficult and demanding: consequences. Decision-making has consequences and failing means we suffer them. How can we teach decision-making minus the consequences?

Mollick goes on:

Opportunities for deliberate practice are relatively easy to find in fields that have a lot of students: sports, math, musical instruments, and learning foreign languages, to name a few. In each case, there are many trained teachers, with good lesson plans, easy access to practice, and well-thought out approaches. But in most jobs, ranging from entrepreneurship to leadership, there are few opportunities to practice until you actually start doing things. And that can be a problem.

When it comes to failure, there’s a close companion to consequences. It’s feedback. Feedback drives the learning loop. Without feedback, the loop is broken. Learning is stalled. In knowledge work, feedback is delayed and mixed with a thousand other real-life things that make it hard to separate signal from noise.

Dear reader, how can you sidestep the problems of negative consequences and limited feedback when it comes to learning decision-making? Or entrepreneurship? Or leadership?

How will future generations learn? What must they stop wasting time on? What should they start doing? These are the big questions I’m thinking of within the context of decision-making. Underneath these questions is the second maxim I wish to follow:

Provide mechanisms for deliberate practice for learners so that they find learning fun.

In other news…

Some comments on E-book I of my Decision Decoder series, which dropped last week:

‘Hi Satyajit, I was just going through your pdf on Decision making.

I have not completed it yet, but whatever I have read so far is truly GOLD.’ — Abhitesh Das, Engineering Leader

I’ve started reading through your book, and clearly you’ve managed to synthesize advice from a lot of folks and sectors. Super interesting! — Sandeep Nair, Brand Marketing Consultant

I did get a chance to go through your e-book. Just one input - you should not be handing it over free. It has nectar of your thinking and work.— Himanshu Pandya, Wealth Manager and Investment Advisor

Some anticipation:

Ordered for the ebook! So looking forward to reading your insights and suggestions borne out of lived experiences Satyajit Rout ... congratulations 🎉😍 – Uma Chatterjee, Social Entrepreneur

I also had a fanboy moment. Annie Duke, one of my favorite teachers, featured my question in her mailbag.

_What have been your biggest challenges in showing the value of better decision making to people? _— Satyajit Rout

Annie’s response:

The biggest challenge is not in showing the value of better decision making to people since I think everyone knows that better decision making is a worthwhile goal. The challenge is in _getting people to do _the things [italics mine] that would actually improve their decision making.

A few examples:

  1. Creating checklists and rubrics is crucial but it is really hard to get people to create them and even more challenging to get people to actually use them.
  2. One of the best things you can do to improve the quality of group decisions is to get feedback from the group independently and asynchronously. In other words, make sure that no one in the group is exposed to the opinions of anyone else in the group before they offer their point of view. The issue is that people love to talk about things in group settings. It feels creative! It makes people feel like they are on the same page and really gelling! Getting folks’ judgments in group setting creates groupthink, cross-contamination, influence, and coercion that result in a group that is less creative and less accurate. But it is really hard to get people to do pre-work.
  3. People love to believe in their gut. Getting folks to make explicit why their gut is telling them a particular decision is the right way to go is hard. If you make the rationale explicit, then it can be examined. It is exposed. People might disagree with you. It might turn out your gut is wrong. But that is why making the implicit explicit is so important because that is the only way you can catch an error before acting on it. The reality is that if you want to hone your instincts then you must make explicit what your gut is telling you so you can figure out when it is leading you down the right path and when it is leading you astray.

With the roles defined, these are the common assumptions about the principal-agent situation.

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