Thinking Tools

Creativity by Imitation: How to Steal Others’ Ideas and Innovate

October 22, 2018 By Nagesh Belludi 2 Comments

Emulating others’ ideas is an underappreciated learning tool. Many creative innovators set forth as remarkably astute mimics of others. “Good artists copy, great artists steal,” prods a creator’s maxim often misattributed to Picasso.

Imitation is a leading pathway to business innovation, even if being an imitator is anchored by a sense of derision. Ever more businesses are nicking great ideas wherever they can obtain them—in their own industries or beyond. Hospitals have adapted safety and efficiency procedures from the military and the airline industry. Aircraft manufacturers have adopted the car industry’s lean supply chain management concepts. Ritz-Carlton, the luxury chain of hotels and resorts, runs the Ritz-Carlton Leadership Center that has helped trained its legendary cult of customer service and employee empowerment best practices to managers from companies across industries.

Creativity by Taking Existing Ideas: Applying Them in a New Context

The most prominent example of innovating by imitation is Ford’s development of the automobile assembly line—a system Henry Ford copied (and improved) from the Chicago meat processing business.

Henry Ford’s relentless ambition to build his Model T a high-volume-low-cost automobile, together with his engineering knowledge and manufacturing experience provided the leadership and creative environment that nurtured the development of the moving mechanical assembly line. Today, the moving assembly line is the epitome of manufacturing. Almost everything that is now industrially manufactured—automobiles, aircrafts, toys, furniture, food—passes down assembly lines before landing in our homes and offices.

The genesis of the moving assembly line is in the American agricultural products industry. During the late 18th century, the movement of grains changed from hand labor to belts and later moving hoppers.

Innovation by Imitation: Many Innovations Come from the Outside

By 1873, Chicago’s meat-processing industry adapted belts and hoppers to transform beef and pork production into a standardized, mechanized, and centralized business. After cows and pigs travelled to their fate in train cars from farms throughout the Midwest, they were dropped into hoppers and killed. Conveyor belts then moved carcasses past meat cutters, who progressively removed various sections of the animal, cut them into appropriate sizes, and repackaged and dispatched processed meat across the United States.

The meat processors’ task was disassembly (as opposed to putting together automobile parts in Ford’s plants.) Each worker had a specific, specialized job. Production moved swiftly. The American writer Upton Sinclair famously described this industry’s ghastly working conditions in his acclaimed novel The Jungle and said, “They use everything about the hog except the squeal.”

Chicago Slaughter Houses Were the Pioneers of the Moving Disassembly Line Before Henry Ford Started His Assembly Line

In the early 1900s, when Henry Ford wanted to keep Model T production up with demand and lower the price, Ford’s team explored other industries and found four ideas that could advance their goal: interchangeable parts, continuous flow, division of labor, and cutting wasted effort. Ford’s engineers visited Swift & Company’s Slaughterhouse in Chicago and decided to adopt the “disassembly line” method to build automobiles.

The introduction of the moving assembly line process in 1913 enabled increased production up to 1,000 Model Ts a day and decreased assembly time from 13 hours to 93 minutes. Additional refinement of the process, thanks to reliable precision equipment and standardized shop practices, shortened production time radically: within a few years, a new Model T rolled off the assembly line every 24 seconds. First produced in 1908, the Model T kept the same design until the final one—serial number 15,000,000 rolled off the line in 1927.

Auschwitz-Birkenau and Victims of the Holocaust

Sadly, just as Henry Ford copied the Chicago meat processing and perfected the moving assembly line, the Nazi apparatus copied Ford’s methods of mass production to massacre six million people. While Midwestern butchers processed the livestock carcasses, the Nazis systematically handled corpses of the victims of the Holocaust. Nazi operatives removed victims’ hair, clothing, shoes, gold teeth, hairbrushes, glasses, suitcases, and anything of value to be repurposed for the Reich. The atrocities of this inexpressibly shocking disaster are on display at the train tracks and the museums of Auschwitz-Birkenau, Poland.

Formal Strategic-Benchmarking Programs

Smart businesses have formal strategic-benchmarking programs to achieve significant efficiency improvements: they pinpoint the strategic capabilities that matter most to their businesses, seek out companies or businesses that currently manage those capabilities best, and try to copy and deploy those capabilities as rapidly as possible. But time is of the essence for the success of these undertakings, as the management guru Tom Peters warns,

I hate Benchmarking! Benchmarking is stupid! Why is it stupid? Because we pick the current industry leader and then we launch a five-year program, the goal of which is to be as good as whoever was best five years ago, five years from now. Which to me is not an Olympian aspiration.

Imitation is a Key Characteristic of Highly Creative People: The Case of Steve Jobs Copying from Xerox

One of the key characteristics of highly creative people is their exposure to and experience with working in several related domains. They are very good at crossing domain boundaries, relating their creativeness in new and perhaps unexpected ways, and adapting knowledge into new domains. The following case of one of history’s most famous innovators illustrates this distinguishing characteristic.

Steve Jobs of Apple introduced the revolutionary Lisa computer in 1983. It featured such innovations as the graphical user interface, a mouse, and document-centric computing. Jobs had taken—and refined—all these inventions from Xerox’s PARC research labs and introduced by Xerox on its commercially-unsuccessful Alto and Star computers in 1981. The biographer Walter Isaacson writes in his best-selling Steve Jobs: “The Apple raid on Xerox PARC is sometimes described as one of the biggest heists in the chronicles of industry.” Isaacson cites Jobs: “Picasso had a saying—‘good artists copy, great artists steal’—and we have always been shameless about stealing great ideas… They [Xerox management] were copier-heads who had no clue about what a computer could do… Xerox could have owned the entire computer industry.”

Idea for Impact: Borrow Ideas from Others and Combine Them with Your Own Creativity

Interestingly, many “benchmarking” exercises in the world of business—even academia—do not come “top-down” out of strategy. In other words, innovations by imitation are typically not driven from the top down. Instead, they materialize from everyday operational challenges—those painful experiences that send managers scuttling for solutions in a hurry.

Look outside your industry. To improve your creativity, try spending time researching other smart companies—even those outside of your industry. Learning directly from other companies is a useful, underutilized form of research for finding ways to improve performance.

Attend to developments at your competitors and in other industries. Look for potential opportunities that have been discovered elsewhere. Avoid the “not invented here” syndrome—don’t reject other’s great ideas. Keep an open mind.

Don’t Ignore the Counterevidence

September 14, 2018 By Nagesh Belludi Leave a Comment

Left to themselves, much of our opinions and judgments are subjective, imprecise, incomplete, narrow-minded, or utterly unapprised.

A good critical-thinker deliberates objectively about alternative world-views that may cause him/her to philosophize differently. The English philosopher and economist John Stuart Mill made an unparalleled case for this intellectual obligation in his treatise On Liberty (1859):

If the cultivation of the understanding consists in one thing more than in another, it is surely in learning the grounds of one’s own opinions. Whatever people believe, on subjects on which it is of the first importance to believe rightly, they ought to be able to defend against at least the common objections. … on every subject on which difference of opinion is possible, the truth depends on a balance to be struck between two sets of conflicting reasons. Even in natural philosophy, there is always some other explanation possible of the same facts; some geocentric theory instead of heliocentric, some phlogiston instead of oxygen; and it has to be shown why that other theory cannot be the true one: and until this is shown, and until we know how it is shown, we do not understand the grounds of our opinion. But when we turn to subjects infinitely more complicated, to morals, religion, politics, social relations, and the business of life, three-fourths of the arguments for every disputed opinion consist in dispelling the appearances which favour some opinion different from it. The greatest orator, save one, of antiquity, has left it on record that he always studied his adversary’s case with as great, if not with still greater, intensity than even his own. What Cicero practised as the means of forensic success, requires to be imitated by all who study any subject in order to arrive at the truth. He who knows only his own side of the case, knows little of that. His reasons may be good, and no one may have been able to refute them. But if he is equally unable to refute the reasons on the opposite side; if he does not so much as know what they are, he has no ground for preferring either opinion. The rational position for him would be suspension of judgment, and unless he contents himself with that, he is either led by authority, or adopts, like the generality of the world, the side to which he feels most inclination.

Mill recommends anticipating the potential objections to one’s argument, coming to terms with the merits of opposing points of view, and establishing why the balance of reasons still supports one’s viewpoints:

Ninety-nine in a hundred of what are called educated men are in this condition; even of those who can argue fluently for their opinions. Their conclusion may be true, but it might be false for anything they know: they have never thrown themselves into the mental position of those who think differently from them, and considered what such persons may have to say; and consequently they do not, in any proper sense of the word, know the doctrine which they themselves profess. … So essential is this discipline to a real understanding of moral and human subjects, that if opponents of all important truths do not exist, it is indispensable to imagine them, and supply them with the strongest arguments which the most skilful devil’s advocate can conjure up.

Idea for Impact: Consider objections to your viewpoints; Remain open to alternative interpretations.

Suspend your inclinations and commitments and ask whether any of the objections have some force against your argument.

Don’t argue merely from those premises that appear compelling to you; address the premises that appear compelling to your opponent.

As Aristotle counseled, “The fool tells me his reasons; the wise man persuades me with my own.”

Summary of Richard Carlson’s ‘Don’t Sweat The Small Stuff’

September 4, 2018 By Nagesh Belludi 1 Comment

Stress follows a peculiar principle: when life hits us with big crises—the death of a loved one or a job loss—we somehow find the inner strength to endure these upheavals in due course. It’s the little things that drive us insane day after day—traffic congestion, awful service at a restaurant, an overbearing coworker taking credit for your work, meddling in-laws, for example.

It’s all too easy to get caught up in the many irritations of life. We overdramatize and overreact to life’s myriad tribulations. Under the direct influence of anguish, our minds are bewildered and we feel disoriented. This creates stress, which makes the problems more difficult to deal with.

The central thesis of psychotherapist Richard Carlson’s bestselling Don’t Sweat The Small Stuff… And It’s All Small Stuff (1997) is this: to deal with angst or anger, what we need is not some upbeat self-help prescriptions for changing ourselves, but simply a measure of perspective.

Perspective helps us understand that there’s an art to understand what we should let go and what we should concern ourselves with. As I mentioned in my article on the concept of opportunity cost, it is important to focus our efforts on the important stuff, and not waste time on the insignificant and incidental things.

I’ve previously written about my favorite 5-5-5 technique for gaining perspective and guarding myself against anger erupting: I remove myself from the offending environment and contemplate if whatever I’m getting worked up over is of importance. I ask myself, “Will this matter in 5 days? Will this matter in 5 months? Will this matter in 5 years?”

Carlson stresses that there’s always a vantage point from which even the biggest stressor can be effectively dealt with. The challenge is to keep making that shift in perspective. When we achieve that “wise-person-in-me” perspective, our problems seem more controllable and our lives more peaceful.

Carlson’s prescriptions aren’t uncommon—we can learn to be more patient, compassionate, generous, grateful, and kind, all of which will improve the way we feel about ourselves and the way that other people feel when they are around us.

Some of Carlson’s 100 recommendations are trite and banal—for example, “make peace with imperfection,” “think of your problems as potential teachers,” “remember that when you die, your ‘in-basket’ won’t be empty,” and “do one thing at a time.” Others are more edifying:

Let others have the glory
Let others be “right” most of the time
Become aware of your moods and don’t allow yourself to be fooled by the low ones
Look beyond behavior
Every day, tell at least one person something you like, admire, or appreciate about them
Argue for your limitations, and they’re yours
Resist the urge to criticize
Read articles and books with entirely different points of view from your own and try to learn something

Carlson’s succinct insights have hit home with legions of the hurried and the harried. He became a bestselling author and a sought-after motivational speaker. Before his tragic death in 2006 at age 45, Carson followed up “Don’t Sweat The Small Stuff…” with some 20 tacky spinoffs intended particularly for spouses, parents, teenagers, new-weds, employees, and lovers.

Disproven Hypotheses Are Useful Too

June 21, 2018 By Nagesh Belludi Leave a Comment

Hypotheses are conjectures—often merely proposals or intuitions—about what may constitute facts.

A specific hypothesis can be tested for its adequacy and proved correct or incorrect using the scientific method. Sometimes, a hypothesis is accepted for the time being, until further evidence suggests an amendment.

It does not matter if a certain hypothesis is proven incorrect because, in itself, the falsification of a hypothesis can offer precious insight about the “what is not” to enhance the “what is.”

Hypotheses are the bedrock of scholarship. Scientific understanding accrues when many interrelated and tested hypotheses are used to develop theories, and rethink and restructure our knowledge.

The Historian’s Fallacy: People of the Past Had No Knowledge of the Future

June 7, 2018 By Nagesh Belludi Leave a Comment

The practice of picking a thesis and then setting out to establish it is a widespread intellectual pursuit. But biographers and historians sometimes portray their subjects as if the historical participants could recognize what lay ahead of them.

Assuming that people of the past pondered over the events of their day from the same perspective as we do in the present is committing The Historian’s Fallacy.

The notion of the historian’s fallacy was first presented by the British literary critic Matthew Arnold (1822–88) in The Study of Poetry (1880.) In questioning how historical backgrounds were portrayed in the development of literary styles, Arnold called attention to the frequent logical error of using hindsight to assign a sense of causality and foresight of significant historical events to the people who lived through them. In reality, those historical participants may not have had wide-ranging perspective that we assume in interpreting the context, conventions and limitations of their time. Arnold wrote,

The course of development of a nation’s language, thought, and poetry, is profoundly interesting; and by regarding a poet’s work as a stage in this course of development we may easily bring ourselves to make it of more importance as poetry than in itself it really is, we may come to use a language of quite exaggerated praise in criticising it; in short, to overrate it. So arises in our poetic judgments the fallacy caused by the estimate which we may call historic. … Our personal affinities, likings and circumstances, have great power to sway our estimate of this or that poet’s work, and to make us attach more importance to it as poetry than in itself it really possesses, because to us it is, or has been, of high importance.

The American historian David Hackett Fischer, who coined the phrase “historian’s fallacy,” cited the claim that the United States should have anticipated Japan’s surprise attack on Pearl Harbor because of the many warning signs that an attack was in the cards. Fischer argues those signs seem obvious only in hindsight—to the World War II military leaders, many of those signs suggested possible attacks on many positions other than Pearl Harbor.

A good historian strives for objectivity by ignoring his own knowledge of consequent events and employing only what the historic individuals would have known in the context of their own time.

A related fallacy is Presentism—a manner of historical analysis wherein the past is interpreted by means of present-day attitudes. Presentism often fosters moral self-righteousness. Employing present-day moral standards to reflect on the Founding Fathers’ ownership of slaves, David Hume’s racism, or Gandhi’s opposition to modernity and technology should not be tainted by our stance of temporal condescension.

What Airline Disasters Teach About Cognitive Impairment and Decision-Making Under Stress

February 27, 2018 By Nagesh Belludi Leave a Comment

Airline disasters often make great case studies on how a series of insignificant errors can build up into catastrophes.

As the following two case studies will illuminate, unanticipated pressures can force your mind to quickly shift to a panic-like state. As it searches frenetically for a way out of a problem, your mind can disrupt your ability to take account of all accessible evidence and attend rationally to the situation in its entirety.

Stress Can Blind You and Limit Your Ability to See the Bigger Picture: A Case Study on Eastern Airlines Flight 401

Eastern Airlines Flight 401 crashed on December 29, 1972, killing 101 people.

As Flight 401 began its approach into the Miami International Airport, first officer Albert Stockstill lowered the landing gear. But the landing gear indicator, a green light to verify that the nose gear was correctly locked in the “down” position, did not switch on. (This was later verified to be caused by a burned-out light bulb. Regardless of the indicator, the landing gear could have been manually lowered and verified.)

The flight deck got thrown into a disarray. The flight’s captain, Bob Loft, sent flight engineer Don Repo to the avionics bay underneath the flight deck to verify through a small porthole if the landing gear was actually down. Loft simultaneously directed Stockstill to put the aircraft on autopilot. Then, when Loft unintentionally leaned against the aircraft’s yoke to speak to Repo, the autopilot mistakably switched to a wrong setting that did not hold the aircraft’s altitude.

The aircraft began to descend so gradually that it could not be perceived by the crew. With the flight engineer down in the avionics bay, the captain and the first officer were so preoccupied with the malfunction of the landing gear indicator that they failed to pay attention to the altitude-warning signal from the engineer’s instrument panel.

Additionally, given that the aircraft was flying over the dark terrain of the Everglades in nighttime, no ground lights or other visual cues signaled that the aircraft was gradually descending. When Stockstill eventually became aware of the aircraft’s altitude, it was too late to recover the aircraft from crashing.

In summary, the cause of the Flight 401’s crash was not the nose landing gear, but the crew’s negligence and inattention to a bigger problem triggered by a false alarm.

Stress Can Blind You into Focusing Just on What You Think is Happening: A Case Study on United Airlines Flight 173

United Airlines Flight 173 crashed on December 28, 1978, in comparable circumstances.

When Flight 173’s pilots lowered the landing gear upon approach to the Portland International Airport, the aircraft experienced an abnormal vibration and yaw motion. In addition, the pilots observed that an indicator light did not show that the landing gear was lowered successfully. In reality, the landing gear was down and locked in position.

With the intention of troubleshooting the landing gear problem, the pilots entered a holding pattern. For the next hour, they tried to diagnose the landing gear glitch and prepare for a probable emergency landing. During this time, however, none of the pilots monitored the fuel levels.

When the landing gear problem was first suspected, the aircraft had abundant reserve fuel—even for a diversion or other contingencies. But, all through the hour-long holding procedure, the landing gear was down and the flaps were set to 15 degrees in anticipation of a landing. This significantly increased the aircraft’s fuel burn rate. With fuel exhaustion to all four engines, the aircraft crashed.

To sum up, Flight 173’s crew got preoccupied with the landing gear’s malfunction and harried preparations for an emergency landing. As a result of their inattention, the pilots failed to keep tabs on the fuel state and crashed the aircraft.

Stress Can Derail Your Train of Thought

Under pressure, your mind will digress from its rational model of thinking.

The emotional excitement from fear, anxiety, time-pressure, and stress can lead to a phenomenon known as “narrowing of the cognitive map.” This tunnel vision can restrict your field of mindful attention and impair your ability for adequate discernment.

Situational close-mindedness can constrict your across-the-board awareness of the situation and force you overlook alternative lines of thought.

Idea for Impact: To combat cognitive impairment under stress, use checklists and standard operating procedures, as well as increased training on situational awareness, crisis communication, and emergency management, as the aviation industry did in response to the aforementioned incidents.

Turning a Minus Into a Plus … Constraints are Catalysts for Innovation

November 29, 2017 By Nagesh Belludi Leave a Comment

Creativity Thrives Best When Constrained

“Art consists in limitation,” as the English writer G. K. Chesterton remarked. Constraints are the sine qua non of creativity.

One of the great ironies of creative thinking is that it seems to benefit from constraints. At first blush, inventive thinking may seem to require a great degree of freedom and a lack of restrictions, but the reality of the creative process is that it is frequently entwined with many challenging constraints and intractable requirements. In the right light, demanding constraints can truly be blessings in disguise as the French poet Paul Valery observed, “A person is a poet if his imagination is stimulated by the difficulties inherent in his art and not if his imagination is dulled by them.”

Constraints can shape and focus problems and provide clear challenges to overcome. Constraints stimulate creativity because they not only invigorate inventive thinking but also reduce the complexity of the problem at hand. That is to say, constraints can make a problem more controllable, and possibly even more appealing.

Constraints and Challenge Can Actually Be Assets to the Creative Process

When you explore inventions that are creative, you’ll discover that the creators often exploited some core constraints that had characterized their domain in the past. Here are six examples of creativity that exploited a constraint to great advantage.

In 1986, British Airways ran a “Go for it, America!” marketing campaign to give away 5,200 free seats—all seats on its scheduled flights between USA and UK on June 10, 1986. In response, the upstart Virgin Atlantic ran its own newspaper advertisements that declared, “It has always been Virgin’s policy to encourage you to fly to London for as little as possible. So on June 10 we encourage you to fly British Airways.” And in smaller type, the ad read, “As for the rest of the year, we look forward to seeing you aboard Virgin Atlantic. For the best service possible. At the lowest possible fare.” The British Airways giveaway generated a lot of publicity, but most of the news coverage also mentioned Virgin’s unexpected, witty response.
In October 1984, during the second presidential debate with challenger Walter Mondale, Henry Trewhitt of the Baltimore Sun questioned President Ronald Reagan about his age: “You already are the oldest President in history, and some of your staff say you were tired after your most recent encounter with Mr. Mondale. I recall, yes, that President Kennedy, who had to go for days on end with very little sleep during the Cuba missile crisis. Is there any doubt in your mind that you would be able to function in such circumstances?” Reagan famously replied, “Not at all, Mr. Trewhitt and I want you to know that also I will not make age an issue of this campaign. I am not going to exploit for political purposes my opponent’s youth and inexperience.” Tyrwhitt responded, “Mr. President, I’d like to head for the fence and try to catch that one before it goes over.” Mondale lost and Reagan got elected for his second term as President. [See YouTube clip of this debate.]
An determined young woman I knew was embarking on a career as a new architect. She had set her sights on a job with a prominent architectural firm, but her professors and career councilors urged her to gain experience at a smaller employer first, as no prestigious firm would take on an inexperienced, new graduate. Undeterred, the young woman applied to the firm she had set her sights for. When asked about her experience, she declared slickly, “I have no experience at all. You see, I want to learn this business at a top quality firm. Employ me and mentor me to suit your design practices. This way, I’ll not have to unlearn any of the second-rate skills I’d have learned in another place.” She got the job.
When YouTube launched in 2005, many of its upstart competitors examined each uploaded video for copyright infringement. However, unlike its competitors, YouTube calculatedly let users upload any content and waited for copyright owners to complain before taking down noncompliant videos. By choosing to put their business model at risk, YouTube rapidly grew in content and viewers. Its early rivals faded out, and YouTube got acquired by Google and went on to became the world’s leading video-sharing platform.
Legend has it that one day, the Spanish painter Pablo Picasso (1881–1973) had only blue paint to work with. When he started toying with the effects of painting with one color, he discovered the potential to produce interesting paintings that conveyed a sense of melancholy. Picasso had just relocated to Paris and was deeply affected by a close friend and fellow artist’s suicide. Art historians believe this event marked the onset of Picasso’s Blue Period (1901–1904,) during which he produced many stoic and sentimental paintings in mostly monochromatic shades of blue and blue-green. In what would become the hallmark of this greatest artist of the 20th century, Picasso leveraged an apparent constraint into an unintended creative outcome.
When American sculptor Janet Echelman’s art supplies never arrived to South India on a Fulbright scholarship trip, Echelman altered her plans and started working with bronze casts inspired by the local materials and culture of Mahabalipuram, fishing village famous for sculpture. However, she soon found the material too heavy and expensive for her Fulbright budget. While examining fishermen bundling their nets one evening, Echelman began speculating if nets could be a new approach to sculpture. However, the delicate surfaces of the fishnets revealed every ripple of wind. Echelman hoisted the fishnets onto poles and created sturdy volumetric forms without heavy, solid materials. Echelman’s building-sized constructed net art structures are now featured in many cities around the world. [See Janet Echelman’s TED talk.]

In each situation, the inventor reframed elements of his/her world that he/she couldn’t control.

When faced with an element of the situation that they cannot ignore or overcome, instead of tackling those problems head-on, creative folks tend to leverage their constraints in a creative way and reframe them into an exceptionally powerful problem-solving technique.

Idea for Impact: Constraints often stimulate creativity rather than suppress it.

The heart of many a problem lies in what seems to be a single, intractable element. When that’s the case, instead of asking, “how can I minimize this liability?” explore “how can I make the most of it?”

Fight Ignorance, Not Each Other

November 24, 2017 By Nagesh Belludi Leave a Comment

We live in a era of hyper-polarization and hyper-politicization. Studies suggest that we Americans have mostly devolved to two political groups that fervently believe that all wisdom resides in their particular standpoints and therefore care less and less to empathize with the other side.

People loathe the “other” ideological group with such visceral obsession that their hate pollutes their minds. Thanks partly to social media, self-organized tribes are isolating themselves into geographic, religious, ideological, educational, ethnic, and media bubbles of like-minded crusaders.

As I wrote previously, studies have shown that hanging around a group of likeminded folks can make people even more scornful of differing viewpoints, than they are as individuals. They demonize anyone who disagrees with them. They neither account for the case against their positions, nor find middle ground.

In the wake of the 2011 Tucson shooting (where perpetrator Jared Loughner shot and killed six individuals, and injured 14 others at a political gathering,) meditation teacher James Baraz of wrote a Huffington Post essay underscoring the ignorance that brings about the aforesaid demonization:

The real villain is in this story is not Jared Loughner. It’s not the media. And it’s not the gun rights advocates. The real villain is ignorance. Because of ignorance, people project their fear and turn those who are different into enemies—both in their minds and in actuality. Once you demonize the “other” they become less than human and you can inflict pain on them without guilt or shame.

How to Guard Against Anything You May Inadvertently Overlook

October 23, 2017 By Nagesh Belludi Leave a Comment

The World is More Inundated with Uncertainties and Errors Than Ever Before

Checklists can help you learn about prospective oversights and mistakes, recognize them in context, and sharpen your decisions.

I am a big fan of Harvard surgeon and columnist Atul Gawande’s The Checklist Manifesto (2009.) His bestseller is an engaging reminder of how the world has become so complex.

The use of the humble checklist can help you manage the myriad of complexities that underlie most contemporary professional (and personal) undertakings—where what you must do is too complex to carry out reliably from memory alone. Checklists “provide a kind of a cognitive net. They catch mental flaws inherent in all of us—flaws of memory and attention and thoroughness.”

Gawande begins The Checklist Manifesto with an examination of the characteristics of errors from ignorance (mistakes you make because you don’t know enough—“much of the world and universe is—and will remain—outside our understanding and control”), and errors of ineptitude (mistakes you make because you don’t apply correctly what you know.) Most human and organizational failures involve the latter.

The philosophy is that you push the power of decision making out to the periphery and away from the center. You give people the room to adapt, based on their experience and expertise. All you ask is that they talk to one another and take responsibility. That is what works.

The surgery room, Gawande’s own profession, is the principal setting for many of the book’s illustrative examples of how the introduction of checklists dramatically reduced the rate of complications from surgery. He also provides handy stories from other realms of human endeavor—aviation, structural engineering, and Wall Street-investing.

Getting Things Right, Every Time

Checklists are particularly valuable in situations where the stakes are high enough, but your impulsive thought process could lead to suboptimal decisions.

The benefits of checklists also feature prominently in the thought-provoking Think Twice: Harnessing the Power of Counterintuition (2012.) The author, Credit Suisse Investment analyst and polymath Michael J. Mauboussin, argues that checklists are more effective in certain domains than in others:

A checklist’s applicability is largely a function of a domain’s stability. In stable environments, where cause and effect is pretty clear and things don’t change much, checklists are great. But in rapidly changing environments that are heavily circumstantial, creating a checklist is a lot more difficult. In those environments, checklists can help with certain aspects of the decision. For instance, an investor evaluating a stock may use a checklist to make sure that she builds her financial model properly.

A good checklist balances two opposing objectives. It should be general enough to allow for varying conditions, yet specific enough to guide action. Finding this balance means a checklist should not be too long; ideally, you should be able to fit it on one or two pages.

If you have yet to create a checklist, try it and see which issues surface. Concentrate on steps or procedures, and ask where decisions have gone off track before. And recognize that errors are often the result of neglecting a step, not from executing the other steps poorly.

In addition to creating checklists that are specific enough to guide action but general enough to handle changing circumstances, Mauboussin recommends keeping a journal to gather feedback from past decisions and performing “premortems” by envisioning that a imminent decision has already been proven wrong, and then identifying probable reasons for the failure.

No Matter How Proficient You May Be, Well-designed Checklists Can Immeasurably Improve the Outcomes

The notion of making and using checklists is so plainly obvious that it seems impracticable that they could have so vast an effect.

Investor Charlie Munger, the well-respected beacon of wisdom and multi-disciplinary thinking, has said, “No wise pilot, no matter how great his talent and experience, fails to use his checklist.” And, “I’m a great believer in solving hard problems by using a checklist. You need to get all the likely and unlikely answers before you; otherwise it’s easy to miss something important.”

Idea for Impact: Checklists can prevent many things that could go wrong in the hands of human beings, given our many well-documented biases and foibles. Well-designed checklists not only make sure that all the can-be-relied upon elements are in place in complex decision-making, but also provide for flexibility and room for ad hoc judgment.

Gambler’s Fallacy is the Failure to Realize How Randomness Rules Our World

September 27, 2017 By Nagesh Belludi Leave a Comment

The Gambler’s Fallacy is the misleading belief that the probability of a specific occurrence in a random sequence is dependent on preceding events—that its probability will increase with each successive occasion on which it fails to occur.

Suppose that you roll a fair die 14 times and don’t get a six even once. According to the Gambler’s Fallacy, a six is “long overdue.” Thus, it must be a good wager for the 15th roll of the dice. This conjecture is irrational; the probability of a six is the same as for every other roll of the dice: that is, 1/6.

Chance Events Don’t Have Memories

In practical terms, the Gambler’s Fallacy is the hunch that if you play long enough, you will eventually win. For example, if you toss a fair coin and flip heads five times in a row, the Gambler’s Fallacy suggests that the next toss may well flip a tail because it is “due.” In actuality, the results of previous coin flips have no bearing on future coin flips. Therefore, it is poor reasoning to assume that the probability of flipping tails on the next coin-toss is better than one-half.

A classic example of the Gambler’s Fallacy is when parents who’ve had children of the same sex anticipate that their next child ought to be of the opposite sex. The French mathematician Pierre-Simon Laplace (1749–1827) was the first to document the Gambler’s Fallacy. In Philosophical Essay on Probabilities (1796,) Laplace identified an instance of expectant fathers trying to predict the probability of having sons. These men assumed that the ratio of boys to girls born must be fifty-fifty. If adjacent villages had high male birth rates in the recent past, they could predict more birth of girls in their own village.

There Isn’t a Lady Luck or an “Invisible Hand” in Charge of Your Game

The Gambler’s Fallacy is what makes gambling so addictive. Gamblers normally think that gambling is an intrinsically fair-minded system in which any losses they’ll incur will eventually be corrected by a winning streak.

In buying lottery tickets, as in gambling, perseverance will not pay. However, human nature is such that gamblers have an irrational hunch that if they keep playing, they will eventually win, even if the odds of winning a lottery are remote. However, the odds of winning the jackpot remain unchanged … every time people buy lottery tickets. Playing week after week doesn’t change their chances. What’s more, the odds remain the same even for people who have previously won the lottery.

Gambler’s Fallacy Coaxed People to Lose Millions in Monte Carlo in 1913

The Gambler’s Fallacy is also called the Monte Carlo Fallacy because of an extraordinary event that happened in the renowned Monte Carlo Casino in the Principality of Monaco.

On 18-August-1913, black fell 26 times in a row at a roulette table. Seeing that that the roulette ball had fallen on black for quite some time, gamblers kept pushing more money onto the table assuming that, after the sequence of blacks, a red was “due” at each subsequent spin of the roulette wheel. The sequence of blacks that occurred that night is an unusual statistical occurrence, but it is still among the possibilities, as is any other sequence of red or black. As you may guess, gamblers at that roulette table lost millions of francs that night.

Gambler’s Fallacy is The False Assumption That Probability is Affected by Past Events

The Gambler’s Fallacy is frequently in force in casual judgments, casinos, sporting events, and, alas, in everyday business and personal decision-making. This common fallacy is manifest by the belief that a random event is more likely to occur because it has not happened for a time (or a random event is less likely to occur because it recently happened.)

While growing up in India, I often heard farmers discuss rainwater observing that, if the season’s rainfall was below average, they worry about protecting their crops during imminent protracted rains because the rainfall needs to “catch-up to a seasonal average.”
In soccer / football, kickers and goalkeepers are frequently prone to the Gambler’s Fallacy during penalty shootouts. For instance, after a series of three kicks in the same direction, goalkeepers are more likely to dive in the opposite direction at the fourth kick.
In the episode “Stress Relief” of the fifth season of the American TV series The Office, when the character Jim Halpert learns that his fiancee Pam Beesley’s parents are divorcing, he quotes the common statistic that 50% of marriages wind up in divorce. Halpert then comments that, because his parents are not divorced, it is only reasonable that Pam’s parents are getting divorced.

The Gambler’s Fallacy is a Powerful and Seductive Illusion of Control Over Events That are Not Controllable

Don’t be misled by the Gambler’s Fallacy. Be aware of the certainty of statistical independence. The occurrence of one random event has no statistical bearing upon the occurrence of the other random event. In other words, the probability of the occurrence of a random event is never influenced by a previous, or series of previous, arbitrary events.

Idea for Impact: Be skeptical of most judgments about probabilities. Never rely exclusively on your intuitive sense in evaluating probable events. In general, relying exclusively on your gut feeling or your hunches in assessing probabilities is usually not a reason to trust the assessment, but to distrust it.

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Chance Events Don’t Have Memories

There Isn’t a Lady Luck or an “Invisible Hand” in Charge of Your Game

Gambler’s Fallacy Coaxed People to Lose Millions in Monte Carlo in 1913

Gambler’s Fallacy is The False Assumption That Probability is Affected by Past Events

The Gambler’s Fallacy is a Powerful and Seductive Illusion of Control Over Events That are Not Controllable

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