Category

Personal Development

How to design for intelligent decision making? Mental models

By | All, Behavioural Science, Personal Development

We want to introduce you to one of our intellectual heroes. A man who turned 95 on January 1st of 2019. There’s a fair chance that you’ve never heard about him. But you definitely have heard about his 88 years old associate, Warren Buffett. The man we’re talking about is Charlie Munger.

Charlie Munger

Worldly Wisdom

Charlie Munger became a hero to many people who are interested in better decision-making with a famous lecture he gave in 1994 at USC business school. The talk was called “A Lesson on Elementary, Worldly Wisdom As It Relates To Investment Management & Business”. You can’t find it on Youtube, but the transcript was published on the blog of startup Incubator Ycombinator and in the curious book “Poor Charlie’s Almanack, The Wit and Wisdom of Charles T. Munger“.

I want to urge you to read the transcript of the lecture. It’s one of the most exciting texts you will ever read. I re-read it at least three times per year. In this lecture on Worldly Wisdom, Charlie Munger argues that the reason why Munger and Buffett beat the market with their investments, for more than 60 years is that they have a different approach to decision making. Munger argues that if you want to make better decisions, you need to use more than one mental models to look a the problem. One of his famous quotes to make his point is the following:

“To a man with a hammer, every problem looks like a nail”.

He argues that most people in business, everyday life and investing approach problems from a single mental model. If you work in branding, everything looks like a branding problem, if you work in business consulting, everything sounds like a transformation problem. If you are an economist, everything looks like a market-problem.

Munger and Buffett pride themselves with locking themselves up most of the day, reading books. What they are looking for is elementary worldly wisdom.They are obsessed with learning interesting “mental models”. Mental models are concepts from all kinds of sciences that offer elegant explanations to the world. To quote Munger:

“What is elementary, worldly wisdom? Well, the first rule is that you can’t really know anything if you just remember isolated facts and try and bang ’em back. If the facts don’t hang together on a latticework of theory, you don’t have them in a usable form.

You’ve got to have models in your head. And you’ve got to array your experience—both vicarious and direct—on this latticework of models. You may have noticed students who just try to remember and pound back what is remembered. Well, they fail in school and in life. You’ve got to hang experience on a latticework of models in your head”.

A list of mental models.

There’s a lot of renewed excitement for Munger’s idea of Mental Models. Shane Parish, host of the amazing podcast “The Knowledge Project” and author of Farnamstreet, the ultimate blog on better decision-making by learning from the smartest people in the world. Shane Parish is writing a book on the subject. He recently published a post called “Mental Models, the best way to make intelligent decisions (109 models explained)“. It’s a list of all the mental models that he is using in his daily life. A lot of these models are concepts from cognitive psychology and the science of influence.  BTW, Munger is also fascinated with how human decision-making works. If you understand how people think and why they do what they do, you can do a much better job at predicting and changing their behaviour.

Want to learn more:

  1. Here’s another great blogposts on Mental models (Thanks for sharing: Ed Borsboom)
  2. Start making a list of your favorite mental models in your todo-list. I use Wunderlist. I created a folder “Mental Models” and started the habit to post concepts I use a lot in my thinking. My most recent one is this: “You are the sum of the five people you hang around with”.
  3. Re-read your mental model list regularly. Once you use them to look at challenges or problems, they will always provide you with new ways of looking at the problem and its solutions.

Enjoy Munger while he’s still alive. 🙂
Kind regards,

Tom, Astrid and the SUE | Behavioural Design Team

PS: We had Munger’s mental models in mind when we designed the program of the Behavioural Design Acacademy master classes. Our program is designed to teach you some very powerful and easy to remember mental models for finding human insights and for coming up with smart interventions for behavioural change. #funfact.

A clusterfuck

How to live a meaningful life in a world that is spinning out of control?

By | All, Personal Development

A slightly modified version of this blog was posted on our Behavioural Design Digest Newsletter (subscribe now). 

In this blog I want to share a couple of thoughts on how we can use a better understanding of human decision making to cope with the complicated challenges of our time. I want to make the case for living an anti-fragile life. It’s a bit of a provocative story, but it has a happy ending with some very practical guidelines on how live a great life. So please bear with me.

I’m not going to make silly predictions of what will be big next year. These forecasts are utterly pointless. On the one hand, because these forecasts are not meant to predict the future, but to show off the depth of expertise for the one who’s making them. On the other hand, because the future is becoming increasingly complex and complicated at an accelerating speed. Please allow me to zoom in on these two concepts.

Accelerating Complexity

The future is complex because of exponential technologies. Technological progress is now accelerating so fast that a lot of things that seemed impossible two years ago are already achieved. Just to give you a couple of recent examples that were featured in Peter Diamandis’ amazing newsletter on exponential technologies.

The speed with which radical technological changes are being introduced is so beyond the scope of what we can imagine, that I think it’s just pointless to think about which technology will grow incrementally in 2019.

Accelerating Complications

The second problem with forecasting is that the future is that we have to deal with accelerating complications. Stability is rapidly crumbling on a global scale. The failure of the radicalised free-market to create prosperity and wealth for the many, instead of the few, has set into motion accelerating public anger towards the leading elites. This resulted in a global rise in the demand for radical leaders. This accelerating demand for radical nationalistic leaders has created a critical threshold of leaders that make any coordinated attempt to fight the wicked problems of this time impossible. The Trumps, Putin’s, Orban’s, etc. of this world continuously need to signal their virility to their base. In the world of the alpha male leader, compromises are for pussies.

The big problem of this critical decade is that the demand for strong leadership is only understood by radical demagogues who seize the moment to offer the public what they need –  which is simple explanations and simple answers -, thereby making the complexity of both the problems and the solutions even further out of reach.

Meanwhile, the clock is ticking, An ecosystem collapse is taking place. The bottom of the food pyramid is crumbling. Populations of Insects, birds, bees are rapidly declining. Global warming is spinning out of control, creating rising sea levels and more draught, leading to more refugees, leading to more instability. It’s basically a clusterfuck running out of control.

Human irrationality is making things worse

So we have to deal with accelerating complexity and accelerating complications. To make matters worse: humans have all kinds of mental flaws that make it impossible for us to make rational decisions and judgements to solve these challenges. In an accelerating complex world, we just have to revert to simple shortcuts for decisionmaking to make sense of things. Elites feel more and more entitled to their wealth because they think they earned it. It’s not: It’s the system that decides who gets the opportunities and who’s not. The middle-class is more and more sold for the story that it’s the immigrants and the politicians are responsible for their declining wealth. It’s not: it’s global financial markets and the monopolistic multi-nationals. It’s not too far fetched to think of global capitalism as a virus that turned into cancer, whereby rogue cells are rapidly killing all the healthy cells that keep an organism alive. Local politicians are powerless.

Another bias is the presence bias: we are not able to see changes, because they are not changing our surroundings fast enough. We like to look at the future as a simple continuous line evolving from what we know from the presence and the past. The optimism bias is also related to this: We tend to think the future will be positive and problems will be solved in time.

I hate to say it, but let’s face it: It looks pretty grim, doesn’t it?

A happy ending

Am I a pessimist? No! Those of you who know me, know I’m a very lighthearted person. But I’m not stupid. And I’m not blind. I know we much rather prefer to turn our head away, but this is the – fascinating – time we’re living in. So we have to put our big boy and girls pants on and face things as they are.

In the context of little positive outlooks, how can you remain optimistic and positive? It definitely helps to be an atheist. The only point in life is to experience love, find passions and explore curiosity. If you are able to design your life around these three principles, then you’re going to live a happy life as long as you live. Because – in case you missed the meeting – we’re all going to die.

A second thing you can do is to practice anti-fragility.  I love the concept of anti-fragility as proposed by Nicolas Nassim Taleb. Anti-fragile systems increase in strength, because of stress, shocks, attacks or failures. The better we get in dealing with randomness, change, bad luck and errors, the stronger we will become. Being an entrepreneur creates a natural context for becoming anti-fragile: you’re always experimenting, tinkering and failing your way forward. Taleb also suggests staying out of debt as fast as you can.  And take a lot of small risks instead of significant risks. You can find more tips on how to live an anti-fragile life here.

I can’t predict what 2019 will look like. The only thing I can wish for is to be prepared for unexpected shocks in the system that follows from accelerating complexity and accelerating complications. And if these shocks won’t come in 2019, then my practicing in anti-fragility will have helped me to have a year as great as 2018. I wish you a lot of anti-fragility in 2019.

Enjoy the holidays!
Tom

Image courtesy: A great metaphor for a clusterfuck.

3 techniques that will supercharge your team’s creativity

By | All, HR & Organisation, Personal Development, SUE Amsterdam & Behavioural Design Academy originals

Brainstorms must die

Before we get to the goods of supercharging your team’s creativity, there’s one thing that needs to be taken care of first: Dead to the brainstorm. Maybe it sounds a bit harsh, but sorry, there’s no pardoning act. Brainstorms should die. The ‘inventor’ of the brainstorm Alex F. Osborn gave birth to brainstorms in 1939. So, it’s about time for a makeover. But let’s not question his intentions. According to Wikipedia Mr. Osborn “Was frustrated by employees’ inability to develop creative ideas individually for ad campaigns, in response, he began hosting group-thinking sessions.” And it still holds true: Solitary creative processes have an entirely different dynamic and output than a process in which great minds collide.

But why, oh why, are we then all still trapped in those everlasting flip-over led sessions that feel like such a waste of time and resources and where great minds tend to collapse instead of connecting?

But why, oh why, are we then all still trapped in those everlasting flip-over led sessions that feel like such a waste of time and resources and where great minds tend to collapse instead of connecting? Looking at brainstorms from a human psychology perspective, there’s a quite simple explanation. When a group engages in a group think process, the leader of the pack prevails. It is just nature. The one who is the loudest is heard the most. And the highest in rank at the table is often followed. The real problem with this is that a group only delivers a fraction of the possible number of ideas in a brainstorm.

 

How to supercharge the creative capital of a group

But there’s an upside to this: Research shows that teams are terrible in coming up with ideas but great in selecting ideas. So, if we fix the ideation part of the process, we can create magic. In fact, three simple behavioural design techniques can have a massive impact on the creative output of a group. They will help you to unlock the creative potential of a group, even of presumed non-creatives.

Research shows that teams are terrible in coming up with ideas but great in selecting ideas.

 

How Might We Questions

The first technique has to do with a human psychology principle that’s called the Framing Effect: How information is presented shapes our opinions about it. In this case, it is the question from which you jump-start your creative thinking. You can drive creative output by designing the problem using these three magic words: “How Might We?” Feel how the “Might” instantly liberates you: It urges you to go ahead and explore, to free your mind, be boundary-less, an explorer or pioneer even. Compared to its tight ass brother ‘Can’ it makes a world of difference. Just feel what it does to you when you frame the question as ‘How Can We?”. The ‘Can’ immediately forces you to think about the possibilities and even worse the impossibilities; practicalities also, harshly limiting the number of ideas already at the start of the process.

 

Brainwriting

When getting to the ideation part of the creative process we’ve to keep a few human psychology principles in mind. The first is social proof: People tend to follow the lead of others. Sometimes this manifest itself in the social bias of Authority: We have a strong tendency to comply with authority figures. Or we adjust our behaviour to reflect positively on how peers see us: The Reputation bias. The job to be done in the ideation phase is to reduce the biases that could potentially reduce the creative output and install a free-flowing non-judgmental exchange and ideation process that sparks everyone’s creative fire.

You’ll be amazed by the number and diversity of ideas you as a group will come up with in such limited time. From everyone. The bold and the timid. The upper rankers and the climbing uppers. The creatives and the presumed non-creatives.

A technique to do so is Brainwriting. Instead of coming up with ideas as a group, you start by thinking about ideas as an individual. The method is simple. Determine a ‘How Might We Question’. Give every person a stack of post-its. Set a timer for a brief period, somewhere between 5 and 10 minutes, and then as an individual write down as many ideas as possible, no talking, just go wild by yourself. Write down every idea that pops into your mind on a separate post-it. After time’s up, everyone shares his/her ideas with the group. Stick them on a large piece of paper. Describe them if necessary. But don’t comment on each other’s ideas just yet. All you do is grouping the ideas that seem similar. You’ll be amazed by the number and diversity of ideas you as a group will come up with in such limited time. From everyone. The bold and the timid. The upper rankers and the climbing uppers. The creatives and the presumed non-creatives. Then use the third technique to select the ideas.

 

Dotmocracy

A fundamental concept in behavioural psychology is making target behaviour easier to do. A well-known psychological phenomenon in groups is social compliance. It’s very challenging for an individual to go against the norm, breaking the rules, to think differently. Social deviance is a hard behaviour to show, as it triggers another psychological principle: Loss Aversion. Humans prefer eliminating the risks of loss over increasing the odds of winning. And the most significant loss in a group process is rubbing against the hairs of the highest ranked person in the group and dealing with the personal retributions. But it’s precisely that kind of social deviance of going up against the top-ranked person in the group that helps to select the best ideas. A simple technique to eliminate this pressure and to fight compliance is called dotmocracy.

Loss aversion: Humans prefer eliminating the risks of loss over increasing the odds of winning.

 

The technique is simple: Everyone gets two same colored dots. Everyone groups around the paper with all ideas and at the same moment, you stick a dot on your two favorite ideas. Could be two dots at the same idea, could be dots on your ideas, could be dots on two different ideas. Just pick the ideas that you think have the most potential. Nobody can follow the lead of others, and you instantly get a clear overview of the best ideas. Usually, as a group, you discuss the selected ideas with two dots or more where people are asked to elaborate on the reason for picking the idea. After the explanation, the second round of dotmocracy should be done, placing dots on the ideas that came out as best in the first round. Although sometimes sticking dots at the same time is sometimes impossible (the best group size is therefore 5/6 people), the process shows people authority is not an issue. Everyone’s vote has the same weight. There are no larger dots. No different colored dots. No order of placing the dots.

 

If you only have 30 seconds of reading time, this is what you have to know:

  • Three behavioural psychology techniques can help you to boost the quality and diversity of your creative output;
  • It can help you make your creative output more qualitative as you can involve stakeholders from very different backgrounds, making your ideas more multi-layered and distinct;
  • It offers you a method to come up with ideas on your own without being distracted or disturbed, but at the same time the process involves interaction with others to make ideas better;
  • Instead of working for days on ideas, you come up with ideas fast, and you already get feedback after 15 minutes. Enabling you to make your ideas better or to kill the ideas that appeared not to be as good as you thought at first;
  • It offers new established multidisciplinary teams, such as scrum teams, easy to apply techniques to come up with creative output.

 


You might also like to read:

How to create change by design

 


Astrid is the founder of SUE Amsterdam and The Behavioural Design Academy. Our mission is to unlock the power of behavioural psychology to nudge people into making positive choices in work, life, and play.

In two days of high-end master classes, we train people as certified behavioural change directors. We teach them to unlock the powerful principles of behavioural psychology and use The Behavioural Design Method™ to translate this knowledge into actionable skills to influence personal behaviour or the behaviour of customers, employees, family members or the general public.

Cover image by BntOman ♥ Ƹ̵̡Ӝ̵̨̄Ʒ✿ under Creative Commons license.

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Lose weight using behavioural design

By | All, Food, Health & Fitness, Personal Development, SUE Amsterdam & Behavioural Design Academy originals

Lose weight using behavioural design

One of my favorite authors – Nir Eyal – once said: “Never trust a behavioural designer who’s out of shape.” The reason is that being (or getting) in shape or losing weight is all about showing (or stopping) a particular behaviour. And the secret weapon to successfully losing some extra weight is applying some behavioural design principles on yourself. So, if you want to light up your life and shed some extra you, you simply need to unlock the power of behavioural psychology.

Did I say simply? Yes, I did! The uplifting news is: You can quickly learn how to lose weight by using some simple behavioural design tricks, which you can use to effectively influence your behaviour (and I’m going to share The Golden Tip with you in a moment). Doesn’t that lift some weight off your shoulders already? Or, your bum. Or your belly. Or your second chin. Wherever you’d like. I’m all for it.

The Golden Tip

Okay, I understand you are hungry for The Golden Tip now. I can appreciate this appetite for knowledge. I need to make one more pun about eating before I move on, or are am I overfeeding you with puns already? I get it, so here you go. The Golden Rule is:

Ability eats Motivation for Breakfast

Let me explain what this means and what kind of substantial impact it can have on you realizing your goal to shed some weight. According to BJ Fogg – a Stanford professor who has studied human behaviour for years – there are two dimensions of behaviour: Motivation and Ability. For years we all only used motivation in trying to nudge our behaviour. But, most of the times it is much more effective to work on the ability axis. In plain English, making the desired behaviour easier or the undesired behaviour harder to do.

Let me give you an example. You can be very motivated to lose some weight. Most of us truly do. But most of us also don’t. It often takes the perseverance of a top athlete to stay focused and determined on that goal. Now, I ain’t no Olympic qualifier just yet, and my guess is most of you aren’t either. So, my motivation often goes down the drain, and I often switch to unwanted behaviour, like eating that bag of crisps that happens to be lying there. Or, drink that one (okay four) glasses of wine if you’re with friends. Or heating up that microwave meal after working late. No judgment here, we’ve all been there.

You can’t help your motivation from dropping now and then. But if it happens, ability is your secret weapon to success.

The secret weapon to success

But the key to successfully sticking to your weight loss plan lies exactly here. You can’t help your motivation from dropping now and then. But if it happens, ability is your secret weapon to success. By making your unwanted behaviour hard to do or your wanted behaviour easier to do, you’ll succeed. That’s behavioural design.

It may seem like an open door now, but the best ability intervention is not buying the unhealthy stuff: Don’t have any (not any) in your house, so if your motivation breaks you simply can’t eat something bad for you (making the undesired behaviour harder). Another intervention: Do food prepping. Make a healthy snack staple that will last a week, let’s say a healthy banana cake. If you get the 4 o’clock craving, you have that banana cake ready (making the desired behaviour easier). Bye, bye crisps. Something else: Put a toothbrush and toothpaste on your desk. If you get a snack attack, brush your teeth. See if you like to destroy your sweet minty breezy breath with some sugar or fat now. You won’t (making the undesired behaviour less enjoying aka harder).

These are just some examples of behavioural design by making behaviour harder or examples of making it easier. But I hope you get my point. Motivation is excellent, but the number one secret weapon for losing weight is ability.

Maybe you can come up with some more smart ability ideas yourself. I’d honestly love to hear them. Please post them on our Facebook page so that everyone can take advantage of them. I’ll put a healthy banana cake recipe on there too. To get you started.

How you can start right away

To wrap it up, the things you could do right away:

– Remove all unhealthy food from your house
– Make that banana cake or have someone make it for you
– Get yourself a toothbrush and toothpaste to put on your desk
– Analyse your behaviour: When does your motivation crack and where. And try to come up with some ability interventions for those moments (and please share them with us, ’cause we’re fellow crackers, you’re not alone in this)

Good luck!

Astrid

PS If you know someone who’s struggling to lose some weight, please share this article with him or her.

Astrid is the founder of SUE Amsterdam and The Behavioural Design Academy. Our mission is to unlock the power of behavioural psychology to nudge people into making positive choices in work, life, and play.

In two days of high-end master classes, we train people in unlocking the powerful principles of behavioural psychology and teach them our Behavioural Design Method™ that translates this knowledge into actionable skills to influence personal behaviour or the behaviour of customers, employees, family members or the general public.

Cover photo by Steve Rotman under creative commons license.

Want free training, tools, and tips in your inbox?

Join 2500+ others. Sign up right here, right now for free.