Ep 442 | Where Are You Consistently Wrong?

Thank you for joining me today. It's Brian Gubernick, and welcome to the No Days Off podcast, where we believe that every single day brings a new opportunity to get better. I was recently listening to a podcast done by Shane Parrish. Shane, if you don't know him, is an entrepreneur, an investor. He's the founder of Farnam Street. Which is this platform that's dedicated to personal development and specifically decision-making. He also has a great podcast, it's called The Knowledge Project. It's one to definitely check out in addition to, of course, the No Days Off podcast. And he interviews— Shane interviews lots of experts across a number of different fields with the idea being to uncover insights on how to think better and more clearly and, and just improve your living. Shane is one that I've talked about quite a bit in the past because he is the author of the book The Great Mental Models, or the series actually, The Great Mental Models. And we've gone through a number of mental models that Shane describes in that series, and he describes in his book Clear Thinking. And I was recently, as I mentioned, listening to a podcast he did, an interview he did, with, um, Jim Collins, the individual that wrote Good to Great and a whole handful of other books. And in that interview, I heard Shane talk around this question that he asks himself and asks others. And the question is, where are you consistently wrong? Or if you're asking yourself, where am I consistently wrong? Where am I consistently wrong? And I, I heard that question, and for the next 10-15 minutes after listening to it, I got to thinking about myself and the areas where I'm consistently wrong, because identifying these areas is really a crucial step towards personal growth, towards professional growth. Now, in that process, once you identify kind of where are you consistently wrong I think that if you were talking to Shane, and when you listen to this interview, what he begins to do, of course, is advocate for leveraging specific mental models to address and correct these recurring area errors, these, these areas where you're consistently wrong. I want to go through some of those mental models for you to consider, but first, remember, I want you to ask yourself, look in the mirror and say, where am I consistently wrong? If you are an entrepreneur, for example, maybe you're consistently making poor hires. Maybe, uh, you are consistently mispricing your product. Maybe you are consistently wrong in your analysis of the market. Maybe you are consistently wrong in the, in the specific sales script that you choose to use. Maybe you're not being received as well as you believe you should. You can start asking these questions: where am I consistently wrong? Where am I showing up less than I desire? Now, what are the mental models we should be thinking around? The first mental model that Shane would tell you to use in analyzing these recurring errors is the first principles thinking model. First principles thinking. So in first principles thinking, you're gonna break down a problem into its most basic elements to rebuild understanding from the ground up. So here's, here's how this works. I'll give you an example. Let's say a company is consistently wrong about its product pricing. It's always its strategy around product pricing has shown to be consistently wrong. Now, if we're going to use first principles thinking, what I'm— what you're going to do is you're going to deconstruct the costs of that product, the materials, the labor, the distribution. You're going to deconstruct the cost and the customer value perception instead of just simply relying on competitor pricing. Now, in deconstructing the cost and understanding the customer value perception, what you end up doing is discovering that maybe reducing unnecessary features can lower costs. And when you lower the cost, you can make pricing more competitive. This would be first principles thinking. So one mental model to consider is first principles thinking, breaking down the problem into its most basic elements, and then rebuilding this understanding from the ground up. The next mental model that you have to consider, it's our favorite here at No Days Off, is inversion. What is inversion? Approaching problems by considering the opposite perspective or the opposite outcome. So, a business example, let's say a marketing team struggles to boost customer retention. If we're to use inversion, the, the marketing team should ask, what would drive customers away? Not what would attract customers, but what would drive them away. And what they would answer is that maybe poor customer service and long response times are key risks. So they address these issues, maybe it's through training of staff or improving response times, and they directly improve retention. So if a marketing team is always struggling with retention, if that's a place they're consistently wrong, inversion Simply asking what would drive customers away in this example may help them solve for what they're consistently doing wrong. Another mental model, confirmation bias awareness. What is confirmation bias awareness? This is the tendency to seek information that confirms existing beliefs. In a business example case, let's say, say a CEO believes that expanding into new markets is the only way to grow. Now, to counter confirmation bias, what they would do is gather data on their current market opportunities and talk with the skeptics of the outside market opportunities or the outside market strategy. What this does is create a balanced approach and reveals these untapped local market opportunities. This leads to a more informed growth plan. So In this confirmation bias awareness example, where we're consistently wrong happens to be in this belief that we've got to leave our market to grow. And confirmation bias may be a model— confirmation bias awareness may be a model to evaluate, to counter this, to, to counter these biases that we have. Make sense? Another area to dive into, another mental model to dive into as we're evaluating where we're consistently wrong, we would use the mental model, uh, known as Circle of Competence. In other words, recognize the boundaries of your knowledge and your expertise. So the example I would give here, let's say a tech startup is consistently failing at building a sales team. Like a tech startup, what's great with technology is trying to build a sales force but consistently is making errors with respect to that sales team. The founder, using Circle of Competence, may suddenly realize that sales just happens to fall outside of his or her circle of competence. So instead of continuing to make hiring mistakes, what they would do is maybe bring in a sales consultant to set up systems and hire the right talent. And so they could stay focused on their technical strengths. One more mental model I'll give you, uh, if you want to counter the regular occurrence of errors: probabilistic, prob— probabilistic thinking. What is probabilistic thinking? This is when you're assessing situations in terms of probabilities rather than certainty. So a business example, let's say a company launches new products that fail to meet sales expectations. So new products fail to meet sales expectations. This is some— a place where the company just may be consistently wrong. They've been— it's, it's been proven or determined that new product launches just are not going the right direction, at least as consistently as they should. So if we're going to apply probabilistic thinking The company is going to assess the risks and the probabilities of success for each new product idea. So they're going to focus on the projects with the highest probability of success based on market data, which reduces the frequency of these failures. So they're going to run the math, the probabilities around it, rather than banking on these supposed certainties. So in summary, these examples are really going to demonstrate how the mental models help businesses and individuals kind of identify root causes of consistent errors. And in turn, we will refine our decision-making process and improve outcomes. So leverage these tools and in doing so, create a more resilient and a more adaptive organization. But it all starts with that self-awareness. It all starts with looking in the mirror and saying, where am I consistently wrong? And then figuring out, okay, I'm tired of being consistently wrong. What mental models can I apply here so as to lower that frequency? First principles thinking, inversion, confirmation bias awareness, circle of competence, and probabilistic thinking. Those are what, 5 mental models? There's a lot of other ones, but those are some of my favorites. That's all I have for you today. The No Days Off Podcast. Thank you so much for listening. And remember, every single day brings a new opportunity to get better. So let's get after it.