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Availability Heuristic: Our Preference for the Familiar

May 27, 2023 By Nagesh Belludi Leave a Comment

The availability heuristic is a cognitive bias that can lead people to rely on readily available information or emotionally charged and inherently interesting examples when making decisions or judgments. Essentially, individuals tend to overestimate the probability of events that are easy to recall or that they’ve personally experienced, while underestimating the likelihood of less memorable or less frequent events.

In other words, the ease of retrieval of a misleading cue may make people rely on evidence not because it is dependable but because it is memorable or striking and thus psychologically available to them. They may do so even if the evidence is not logically acceptable or does not logically support their decision.

Doctors often depend on recalling their past dramatic cases and mistakenly apply them to the current situation. People may overestimate the crime rate in their community based on news coverage, even though crime rates may be relatively low. People may dismiss the reality of climate change if they’ve recently experienced a cold winter or heard of a cold snap in a particular region, even though global warming is a long-term trend. Individuals are more likely to purchase insurance after experiencing a natural disaster than before it occurs. In each of these scenarios, the vivid and emotional evidence feels more persuasive rather than it being the most accurate or reliable information.

The availability heuristic can also shape people’s perceptions of air travel safety and lead them to believe that flying is more dangerous than it really is. Airplane accidents are often sensationalized and highly publicized by the media, making them more memorable and more prominent in people’s minds. This can cause individuals to perceive the risk of flying much higher than it actually is, leading them to avoid air travel even though it is statistically one of the safest forms of transportation. In reality, many less vivid and less memorable (i.e., psychologically unavailable) things are much more dangerous than air travel, such as falling down stairs, drowning, choking, and accidental poisoning.

Avoid falling prey to the availability heuristic and making serious misjudgments about the risks associated with different situations. Acknowledge that personal experiences and recent events may not accurately reflect the overall reality of the situation.

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  4. Many Hard Leadership Lessons in the Boeing 737 MAX Debacle
  5. Protect the Downside with Pre-mortems

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Aviation, Biases, Decision-Making, Mental Models, Problem Solving, Psychology, Risk, Thinking Tools

Maximize Your Chance Possibilities & Get Lucky

April 27, 2023 By Nagesh Belludi 1 Comment

'Luck Factor' by Richard Wiseman (ISBN 0786869143) British psychologist Richard Wiseman’s Luck Factor (2003) explores what makes some people lucky and others unlucky.

Being lucky is a mindset to bring to life. Lucky people maximize their chances of creating and noticing a lucky opportunity. They listen to their intuition when they get an opportunistic hunch.

The book’s core premise is whether you’re generally lucky or unlucky depends on your attitude—an optimistic mindset is a self-fulfilling prophecy, indeed. Lucky people expect good fortune; they expect good things to happen in their life. When they do have a run of bad luck, they adopt a resilient attitude and somehow turn that into good luck.

Idea for Impact: Lucky people aren’t lucky by sheer accident. To maximize your chances of getting lucky, get more opportunities and feel luckier. Get out there more often, produce more work, and talk to more people. Be open to the world and ready for new opportunities.

Wondering what to read next?

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Filed Under: Mental Models, Sharpening Your Skills Tagged With: Attitudes, Biases, Books for Impact, Creativity, Luck, Risk, Thinking Tools

The Problem with Positive Thinking

April 18, 2023 By Nagesh Belludi Leave a Comment

When positive thinking is seeing bad situations in a favorable light, you can look for the good and make the best of life’s terrible blows. That’s OK.

The problem with positive thinking is the implication that if things don’t go right, you’ve failed yourself. That you’ve not believed in yourself enough. That you should blame yourself because there’s nowhere else to go.

Positive thinking so isn’t a temperament that works when things aren’t going well—that’s the real test as to whether a mindset holds up.

What you need is an attitude that radically embraces reality. It allows you to face the possibilities of negative encounters and not shun away from them. It lets you honestly appraise your circumstances.

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  5. When Optimism Feels Hollow

Filed Under: Living the Good Life, Mental Models Tagged With: Attitudes, Emotions, Mindfulness, Resilience, Thinking Tools

The Upsides of Slowing Down

April 17, 2023 By Nagesh Belludi Leave a Comment

'Wait Art and Science of Delay' by Frank Partnoy (ISBN 1610390040) Making faster and faster decisions can look like the proper response in a culture obsessed with speediness and efficiency that bleeds into the reckless and hasty. But as investment banker turned-law educator Frank Partnoy’s Wait: The Art and Science of Delay (2012) argues, while fast thinking—like fast food—hits the spot on occasion, too much speed can, however, be counterproductive.

Today we jump faster and more frequently to firm conclusions. We like to believe there is wisdom in our snap decisions, and sometimes there is. But true wisdom and judgment come from understanding our limitations when it comes to thinking about the future. This is why it is so important for us to think about the relevant time period of our decisions and then ask what is the maximum amount of time we can take within that period to observe and process information about possible outcomes. … The amount of time we take to reflect on decisions will define who we are. … Our ability to think about delay is a gift, a tool we can use to examine our lives. Life might be a race against time, but it is enriched when we rise above our instincts and stop the clock to process and understand what we are doing and why. A wise decision requires reflection, and reflection requires pause.

Time pressure, high stakes, and emotionally charged situations make it more likely that we will deviate from rational decisions and fall back on heuristics—caveman thinking indeed. Mental shortcuts may have their place for helping us to navigate quotidian risks like crossing the road or boiling a kettle. However, for every decision that can be made in a moment, there are many others where a considered and judicious approach may save you from calamity.

Idea for Impact: The next time you feel pressured to make a quick decision in the face of the unexpected, try to slow down, take a breath, and ask yourself whether your natural desire to get on with it needs to be tempered with caution.

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  5. Accidents Can Happen When You Least Expect Them: The Overconfidence Effect

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Biases, Critical Thinking, Decision-Making, Stress, Thinking Tools, Thought Process

Three Rules That Will Decide If You Should Automate a Task

March 6, 2023 By Nagesh Belludi 1 Comment

To check if a process or a workstream is a good candidate for being automated, see if it meets all three of these criteria:

  1. The process must be a well-oiled machine. The requirements and outcomes are well established. Is the process stable enough to be automated?
  2. The process doesn’t need someone to engage with it each time. It doesn’t need manual intervention, oversight, excessive customization, or finesse. It runs in the backdrop; it’s boring and doesn’t require ‘higher-order’ thinking. Are there decision points within the process that require human intervention?
  3. The process is time-consuming. By automating it, will you save at least 4x what you’ll invest in automating it?

If the manual process is broken or doesn’t exist, then automating it before it’s a “well-oiled machine” may lead to mistakes and unnecessary rework. Establish success with the manual workflow before attempting to automate it.

Idea for Impact: Picking which processes to automate isn’t easy; yet, the closer you observe the workflow deeply, the sooner you can understand both the happy path to automation and the exceptions.

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  4. Empower Your Problem-Solving with the Initial Hypothesis Method
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Filed Under: Mental Models, Project Management, Sharpening Your Skills Tagged With: Artists, Creativity, Critical Thinking, Mental Models, Problem Solving, Productivity, Thinking Tools, Time Management

Be Smart by Not Being Stupid

December 12, 2022 By Nagesh Belludi Leave a Comment

No superhuman ability is usually required to dodge the many foolish choices to which we’re prone. A few basic rules are all that’s needed to shield you, if not from all errors, from silly errors.

Charlie Munger often emphasizes that minimizing mistakes may be one of the least appreciated tricks in successful investing. He has reputedly credited much of Berkshire Hathaway’s success to consistently avoiding stupidity. “It is remarkable how much long-term advantage we have gotten by trying to be consistently not stupid instead of trying to be very intelligent.” And, “I think part of the popularity of Berkshire Hathaway is that we look like people who have found a trick. It’s not brilliance. It’s just avoiding stupidity.” They’ve avoided investing in situations they don’t understand or summon experience.

As a policy, avoiding stupidity in investing shouldn’t mean avoiding risk wholly; instead, it’s taking on risk only when there’s a fair chance that you’ll be adequately rewarded for assuming that risk.

Idea for Impact: Tune out stupidity. Becoming successful in life isn’t always about what you do but what you don’t do. In other words, improving decision quality is often more about decreasing your chances of failure than increasing your chances of success.

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  3. Making Tough Decisions with Scant Data
  4. Defect Seeding: Strengthen Systems, Boost Confidence
  5. How to Solve a Problem By Standing It on Its Head

Filed Under: MBA in a Nutshell, Mental Models, Sharpening Your Skills Tagged With: Biases, Critical Thinking, Decision-Making, Problem Solving, Risk, Thinking Tools, Thought Process, Wisdom

3 Ways to … Avoid Overthinking

October 17, 2022 By Nagesh Belludi Leave a Comment

Overthinking and over-analyzing the causes and meaning of your thoughts can be tamed through greater self-awareness and mental disengagement.

  1. Set a time limit for your “thinking time,” then make yourself move on to something else or force your decision. Vent your worries to the world, but there’s a risk that you’ll end up even more confused if you keep asking everyone’s opinion. Most of the time, things aren’t as complicated as you perceive them.
  2. Pause and take a step back. Interrupt the thinking process or distract yourself by diverting your attention to something very different. Focused distraction can calm your mind and help you have a coherent view of the whole situation.
  3. Accept that uncertainty is part of this life, and you’ll never have all the facts or know what’s further down the road. Studies suggest we fear an unknown outcome more than a known bad one. Not everything you plan will work out, and that’s ok. It’s often better to set a clear course today and tackle problems that arise tomorrow.

Idea for Impact: Right-size your expectations. Overthinking comes from trying to control what you can’t control.

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  2. The “Ashtray in the Sky” Mental Model: Idiot-Proofing by Design
  3. Smart Folks are Most Susceptible to Overanalyzing and Overthinking
  4. Accidents Can Happen When You Least Expect Them: The Overconfidence Effect
  5. Situational Blindness, Fatal Consequences: Lessons from American Airlines 5342

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Assertiveness, Confidence, Conviction, Critical Thinking, Decision-Making, Thinking Tools, Wisdom

Why People are Afraid to Think

August 26, 2022 By Nagesh Belludi Leave a Comment


Men fear thought as they fear nothing else on earth—more than ruin, more even than death. Thought is subversive and revolutionary, destructive and terrible; thought is merciless to privilege, established institutions, and comfortable habits; thought is anarchic and lawless, indifferent to authority, careless of the well-tried wisdom of the ages. Thought looks into the pit of hell and is not afraid. (Bertrand Russell, Why Men Fight: A Method of Abolishing the International Duel (1916,) pp. 178–179)

Laziness and inability usually coerce people to reject thinking. But, as Russell contends, fear is a non-obvious inhibitor of thought. Not just because meticulous reasoning is demanding but because thinking may occasion an undermining—even revaluation—of our long-held convictions about all sorts of matters—notably religion and ethics.

People reject thinking because we fear it may challenge our equilibrium—how we make sense of the world. We’ll be coerced to see the world anew. As I’ve emphasized previously, once a belief is added to our corpus of viewpoints, we indulge in “intellectual censorship.” We cling to our ideas rather than objectively reassessing and questioning them.

Idea for Impact: Life should alter you. Through conscientious thinking, your worldview can—and should—reflect that growth.

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Filed Under: Mental Models, Sharpening Your Skills Tagged With: Bertrand Russell, Conviction, Critical Thinking, Persuasion, Philosophy, Thinking Tools, Wisdom

What if Something Can’t Be Measured

July 4, 2022 By Nagesh Belludi Leave a Comment

During a September-2021 Airlines Confidential podcast (via Gary Leff’s View from the Wing,) former Spirit Airlines CEO Ben Baldanza told an exciting story about the airline industry’s systematic approach to reckon if potential new routes are economically feasible:

For the most part, airlines rely on data—required and reported by the Bureau of Transportation Statistics—on ticket purchases that show the number of people flying a given route and what price. For example, New Orleans, which is home to one of the largest Honduran populations in the U.S., has not had direct service to Honduras. Spirit Airlines will therefore analyze data from Sabre Market Intelligence for 2019 showing O&D (Origin and Destination) traffic between New Orleans and Honduras.

Sometimes, though, there’s no data on historical demand on a route, such as when Spirit Airlines was considering service to Armenia, Colombia. There hadn’t ever been a U.S. carrier flying into the airport, so there wasn’t available traffic data Spirit could access. Instead, Spirit looked at telephone data and migrant remittance statistics to get a sense of ties between the U.S. and the Latin American city. Spirit studied the frequency with which people were calling friends and relatives and how much money and how frequently money was being remitted as a reliable metric to determine if the new route was viable.

Spirit Airlines relies heavily on leisure bookings, especially visiting friends and relatives (VFR) traffic. In the absence of historical yield data for a route being considered, Spirit used fund transfers to Latin America as a stand-in variable.

A surrogate metric or proxy metric is exactly that—a substitute used in place of a variable of interest when that variable can’t be measured directly or is difficult to measure. For example, per-capita GDP is often a proxy for the standard of living, and the value of a house is a stand-in for the household’s wealth. Freight tonnage is often a proxy for economic activity.

Idea for Impact: Relying on intuition for sound decision-making isn’t sustainable, so folks need a systematic approach to making those decisions. Use meaningful proxy and surrogate metrics in your decisions to help overcome inherent biases with what can’t be measured.

Wondering what to read next?

  1. The Data Never “Says”
  2. Question the Now, Imagine the Next
  3. Making Tough Decisions with Scant Data
  4. Be Smart by Not Being Stupid
  5. The “Ashtray in the Sky” Mental Model: Idiot-Proofing by Design

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Biases, Critical Thinking, Decision-Making, Persuasion, Problem Solving, Thinking Tools, Thought Process

The Best Advice Tony Blair Ever Got: Finding the Time to Think Strategically

June 28, 2022 By Nagesh Belludi Leave a Comment

Former British Prime Minister Tony Blair reminisced, at a 2012 event at the Stanford Graduate School of Business, how easy it is to get so absorbed by the pressures of doing that you rarely ever disentangle yourself from the chock-full of activities and the clutter that can choke strategic thinking.

As the leader of the Opposition, when I went to see him in 1996 at the White House, he explained that one of the hardest things when you get into the government is finding the time to think strategically. It’s being able to create the space so that you’re focused on what you really know counts because otherwise, he said, the system will take you over. You’ll be in meetings from 8:00 in the morning till 10:00 at night, and you think you’re immensely busy, but the tactics and the strategy have all got mixed.

What happens in leadership is that things come at you the whole time. If you’re not careful, you’ll spend your time dealing with one situation after another. You lose your strategic grip on what’ll determine if you’re a successful government. Many of these crises are real, and you must deal with them. But when you judge your government in history, no one will remember any of them. You’ve got to create the space to be thinking strategically all the time to change the world.

Idea for Impact: It’s your strategic thinking, more than any other single activity, that can influence what you’ll achieve as a leader. Find ways to create more “head time” amid the busyness.

Wondering what to read next?

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  2. Three Rules That Will Decide If You Should Automate a Task
  3. Creativity by Imitation: How to Steal Others’ Ideas and Innovate
  4. Question the Now, Imagine the Next
  5. Finding Potential Problems & Risk Analysis: A Case Study on ‘The Three Faces of Eve’

Filed Under: Leadership, Mental Models, Sharpening Your Skills Tagged With: Creativity, Critical Thinking, Leadership Lessons, Thinking Tools, Time Management

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About: Nagesh Belludi [hire] is a St. Petersburg, Florida-based freethinker, investor, and leadership coach. He specializes in helping executives and companies ensure that the overall quality of their decision-making benefits isn’t compromised by a lack of a big-picture understanding.

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Unless otherwise stated in the individual document, the works above are © Nagesh Belludi under a Creative Commons BY-NC-ND license. You may quote, copy and share them freely, as long as you link back to RightAttitudes.com, don't make money with them, and don't modify the content. Enjoy!