425. Decisions Over Decimals: Insights from Christopher Frank

Welcome to episode 425 of the Brainy Business Understanding the Psychology of why People Buy. In today's episode, I'm excited to introduce you to Christopher Frank, Chief Client Officer at PSB Insights. Ready? Let's get started.

You are listening to the Brainy Business Podcast where we dig into the psychology of why people buy and help you incorporate behavioral economics into your business, making it more brain friendly. Now, here's your host, Melina Palmer.

Hello.

Hello everyone.

My name is Melina Palmer and I want to welcome you to the Brainy Business Podcast. In today's conversation, I'm joined by Christopher Frank. Christopher brings frontline experience from 25 years at American Express and Microsoft before joining the PSB Insights team. In his current role as Chief Client Officer, he is renowned for crafting innovative research strategies that leverage consumer insights to achieve competitive advantage in high growth environments. Chris has been featured in Harvard Business Review, Fast Company, Forbes Inc. Fortune, and TedX. A two time author of the acclaimed books Drinking from the Fire Hose and Decisions Over Decimals. His most recent book has been highlighted in Malcolm Gladwell and Dan Pink's Next Big Idea Club. Recognized as a thought leader in building critical thinking skills, Christopher is highly regarded as a lecturer on decision science. He's actively shaping the next generation of leaders as the Co Director of Columbia Business School's Leading in a Data Driven World Developing Quantitative Intuition program and serves as an adjunct professor at Columbia University. We're digging in on Decisions over decimals today in a conversation I know you're going to love and learn a lot from really quickly. Before we get into it, I want to be sure you know that there are links in the show, notes for my top related past episodes and books, ways to get in touch with Christopher and more. It's all within the app you're listening to and@the brainybusiness.com 425 now let's jump right in. Christopher Frank, welcome to the Brainy Business Podcast.

Hi there. I am actually so excited to be here. Looking forward to this conversation.

Oh same. I absolutely loved your book. It was so fun to read.

It made my flight seem so short.

As I was just enthralled in it. We'll get into that soon. But for everyone who doesn't yet know you, can you share a little bit about yourself, your background and the work that you do?

Sure. Happy to. So I've been in data analytics for about 25 years, really been fortunate to work with some of the best in the business at Microsoft and American Express and recently joined PSB Insights as the.

Chief client officer, when you say you've worked in data, right? So as far as data analytics, what.

Does that mean to you?

What aspects of data and for people.

That are saying, hey, I thought we.

Were talking about human behavior, like what.

Are we talking about data for?

Right. Where's the crossover?

Yeah, so where the intersection is around decision making and how do you lead in a data driven world? Both from my education background, my academic background, and also working for these iconic companies, there's a lot of data, there's a lot of information and people are always striving to make the best decision. What my role is, was to play the connector or translator, as I like to think about it, between data and making a better, smarter business decision. I lead off, it's about data. And what we really care about is how do we make faster decisions, smarter decisions, better decisions. Regardless of the industry, whether technology, financial services, or my current role actually partnering with our clients, that constant thread through everything is that consumer behavior or customer behavior or B2B behavior, which is around. I'm striving to make the best decision in a world that is just moving faster and faster.

Yeah, definitely. And I love that in your book we start with questions. That's where I love to start too. And really understanding the problem. Can you give an example of some questions that you like to ask? The value of helping to understand the problem. I always too love a story. If we have anything where people were sure that the problem was A and then we found out it was actually Z in some way.

Yeah, that happens more than not. So I appreciate the, you know, you're starting with let's talk about questions because I think that is so fundamental to making, you know, better decisions. The smartest person in the room is not the one with an answer. It is the person that asks questions. And I know there's a bit of irony in that because as we are taught from education and then when we start out in our careers, people always say, what's the answer? What's the strategy? What's the decision? They're looking for that answer. And when I talk about the smartest person in the room, ask questions, it is really around. Are you demonstrating that you are really engaged? Are you demonstrating that natural curiosity that I think exists in all of us? The power of asking questions is it opens up the dialogue. It really starts to make sure, as you just talked about, are we solving A or are we solving C? By asking questions up front, you start to use that as almost a governor or a regulator on what Are we solving for and what information do we need? Some of my favorite questions that I use on a daily basis and it should almost come with a caveat or an asterisk. They are deceptively simple questions, but some of them include help me understand you may want to consider or my absolutely favorite one. It is three words. It is what surprised you. You are looking to change the dialogue. If you are looking to learn something new and truly, you know, identify those risks that you're not aware about of or identify some of those issues that, you know, I may be thinking about Z and you're thinking about a. Asking the question what surprised you creates a safe learning environment to say, tell me what was unexpected, tell me what I don't know and help me then navigate through that, or let's discuss it. I think that is probably one of the most powerful questions you could ask and start to build into your toolkit. The nice thing is it works across industries, it works across teams, and it works across geographies. You talked about an example. I do an exercise with my working team. If we're tackling an initiative or we have to, you know, we're working on a project together before we, when we get into the room and someone typically, you know, plugs in their laptop and they've done all the data analytics and you know, they want to show us a 60 page PowerPoint with, you know, eight point font. Eight point font does exist. I've used it early on in my career, early on. But the exercise I do is I ask them to Write down in 10 words or less. Why are we here? What is the problem you think we're solving? And then no one puts their name on it and we kind of throw it in the middle of the table. And if I get a 50% response, you know, overlap between that, those are some good meetings. But, you know, I often. And now you'll have different flavors of it. People won't use those same words. But typically, and I'm talking for a larger initiative, not a, you know, something that is well defined. If we're looking to make a big strategic decision around should we open a store in this location? What product innovation should we build in? What should our pricing be? What should our strategic brief or creative strategy go? Using that simple exercise is a very effective way to actually start to frame the problem. And then you follow up with tell me what would surprise you about how we define the problem or tell me what would surprise you as a potential decision. And again, it's all about creating that safe learning environment and you try to minimize any external biases that naturally exist.

Definitely. I loved that. Thank you for that great explanation and for giving some sample questions for people. I think that's always really helpful. And I too, in reading the book, I really like that. What surprised you as a, as a question also to kind of help people get out of their own way of feeling and looking smart. Right. And showing the things that we do know. Right. So we can go look that up later on something here. But if we, it's, it's, it's a nice tiny little like the foot in the door to that vulnerability loop and trust of asking, hey, what was surprising here in a way that feels very safe to be able to answer. Like you said, regardless of, of tenure or location or any other aspect of background, like, hey, what stood out? Because what I love about it, it actually helps someone to look smart because of the connection points, right. To say, well, I, because of all of my extensive knowledge and background, I was surprised by this thing. Right. Or you can be, there's actually value in admitting to something that you didn't know. It's kind of this like roundabout way without putting someone on the spot in a way that, you know, a more pointed question could do. So yeah, I just really love that.

Right. And you know, when we're talking about, you know, understanding individuals behavior and giving tools and developing techniques that people could easily adopt to enable people to engage differently, one of the things about surprises could be profitable regardless of, we talked about industry or tenure. Whether it's a for profit company, a small business, a medium sized business, or even nonprofit. One of the essential questions that I think we are all constantly asking all ourselves or is implied is how do I grow? How do I grow personally? How do I grow this business? You know, if you're a nonprofit, how do I have greater impact? But there's, you know, there's some flavor. How do I grow? And surprises can be profitable. Surprises are the unexpected. You could call them disruptors depending on your industry, but surprises can be profitable when you talk about data analytics. Because regardless of your background, we are all faced with a fire hose of information today. Whether you're in marketing, whether you're on product, you're in supply chain, you're a small business owner, you're dealing with information. So we're not going to get away from that. But when we have unexpected data points, we call them outliers. And what do we do with outliers? Where do you typically find an outlier?

In a presentation, in a footnote, Somewhere on the cutting room floor.

There you go. You want to know why? Because you're spot on. Because people cannot explain. Goes to that comfort level that you just talked about. And by asking what surprised you, hey, was there anything unexpected? You know, you are, you know that what's on that cutting room floor could actually be magic. You know, for someone else that hears that, you may not understand it as the analyst or as a functional expert, but someone else hears about that. I'll give you a very quick example. I ran a global satisfaction program. And you know, on a regular basis, we looked at our customer satisfaction. The US was broken up and divided into, I believe it was 42 districts at that time. And since we did a quarterly review, I was working directly with the GM of the US and we went through all the results. They were all in line. We were up on average about 3 to 4 points on satisfaction. And I called the virtual high fives. Emails go around, hey, we're up, we're green. So we had a few minutes left. And he said, chris, anything unexpected in the data? It was some flavor of what surprised you? And I believe it was eight of the districts. Out of the 42, there were eight that did not follow the pattern. In fact, they were up double digits. So as an analyst, I'm looking at the 42, I'm looking at the whole country. I did some regional breakdowns, all those numbers, I did all the math behind the scenes of probability. And was this a meaningful change? All that mattered. But in eight out of the 42, there were double digit increases, but they were not concentrated. There was one on the west coast, two in the southwest, couple in the northeast, one in the Midwest. And you know, I called them outliers. They were anomalies. So he said to me, could you read off those eight districts? And as I read them off, of course I went, you know, deep, deep back into the appendix equivalent to the cutting room floor. And as I read them out, he leaned over to his chief of staff and I saw them doing check marks. And now, because this was a quarterly review and he was headed up the overall US market, his direct reports were there, Their direct reports were there. And literally you felt the entire room just lean in. They're like, what's going on here? And as I'm calling off these districts, they're doing these check marks. And he's like, huh, that is fascinating. And everyone. And now they're looking at me like, what's fascinating? What does he care about? He's like, we did not tell anyone. I invested in a pilot program that we committed to delivering on site support within four hours of you calling. And we wanted to see if that would have any impact or even be senior followers. He's like, and it matched one for one, the eight districts. And we purposely divided it across the country. It matched one for one those districts where there were outliers. And then he used that data, he funded a major investment and program and on site support and it was a great success. But the key to the story is if you didn't miss it was I called them outliers and I put them in the appendix. And those outliers was some of the richest learning from that study. So outliers could be profitable. And you know, I didn't have the perspective. No one did. I mean the individual district managers, they were just happy, hey, we're up double digits, you're up only 5%, I'm up 12. And you know, it's not like they even do anything. But it took a question like that to unlock a really sharp insight.

Absolutely.

I love that story. Well, and it's so good to like you said, investigate those outliers, ask some questions and look at that, you know, the data and go, I wonder why that is, right? Like what, what might be happening here? Is there something underlying that we're not aware of yet? I always remember having a financial institution background myself. I remember being in a meeting where they were talking about it had to do with getting people to opt into something in the branch. Right. And so I'm pretty sure I think it was overdraft protection. But in this case, and it was saying it's like really hard, it's a difficult sell. And you managers and things, oh, it's, it's so hard to get people to want to opt into this thing. And so all the numbers were fairly low on this except the online branch. So overwhelmingly where it would be like you know, 20% in branch and it was like 80% online that people were opting in for this thing. To which you say, well, there's clearly something that you're all saying and doing that's making people not want to opt in. If when they're on their own, they're, they're doing it right, they're, they're getting the thing. And so looking at the different like cuts and segments of the data, but then people feel it, having that confidence to say, okay, people actually do want this thing and then it can reframe the way they're going to talk about it and think about it. We don't have to redesign the program or anything else. It's just helping them to, to see the, that reframed value in the way that they can talk about it. And then we saw significant lift.

I love that word you just used was reframed. Because I think that is so essential when you're trying to understand behaviors and use information to make a better decision. I'll give you a quick example. In a lot of the work I do at PSB and then even previously in technology and financial services, we wanted to how do you reframe and truly understand that experience? And there is something called Moments of Truth. And there was a great book came out many years ago, I want to say over 15, 20 years ago called Moments of Truth. It is what matters to consumers and how they demonstrate that behavior. You know, often companies talk about they're proud of. You know, in technology they call it speeds and feeds for features and functions. And a lot of companies and brands and products and stores lead with, you know, speeds and feeds. What really matters is observing their behaviors. What are those moments of truth that really are going to shift their consumer journey, their customer journey, for example, in airlines and again, I'm not in airlines, but when I read this book a number of years ago, it was how quickly can you get on the plane and how quickly can you get settled and is there room for, for your bag so you don't have to check? Those are moments of truth that people will, you know, and then obviously did they not lose your bag? Those are the moments of truth that matter for that industry at the time. Now, you know, if you to ask on surveys and just a traditional kind of linear view, people care about safety. So you know, do you care about a safe flight? No surprise, it's off the charts. But it's important to understand when you're talking about behavior and how do you grow profitably and make the right decisions. Really looking at the nuance of what is happening in the behavior. I mean, to your example about overdraft protection, what do they do when you're not there? How are they acting naturally? You know, and I think that is so essential to, you know, I can tell you when we advise our clients, you know, we take really a multi channel input. It's not just quantitative data, it's qualitative, it's ethnography. And then I think the real secret sauce is sitting down to synthesize that. And that is what we spent an enormous amount of time doing for our clients is synthesis. And you may have read this in the book I talk about summary versus synthesis.

Yay. I was going to ask you this one, so I'm glad we're just naturally getting there. I love it. So you talk about summary versus synthesis. Tell us about that.

So summary is data and data is important. Synthesis is data plus judgment. And that is critical to real. And that judgment is critical to making better decisions, more informed strategy, and developing the insights that everyone craves. Here's another interesting thing about research and analytics. You know, there's the saying, what gets measured gets done. Today, everything can be measured. Everything is tracked, coded, and everything is measured. But I think people feel like less and less is getting done. So when you think about just summary data, yes, data is essential. But that judgment, that synthesis is critical. The other thing that I would highlight that kind of builds on synthesis is putting data in context. There's something I call the context triangle and that we work very hard when we talk to our clients, we just don't give them a number. The context triangle is whenever someone gives you a data point, you want to look at every data point from three perspectives. One, look at it in absolute. Two, look at it over time if you have data over time. And three, look at it relative to some benchmark. So depending on your industry, your business, if you get a number and let's say sales are up 5%, that may or may not be good in absolute. 5% for a small company, small business may be fantastic. 5% for a company that over time is used to 25% return is not great. I really want to stress two things. One, the power of asking questions and two, the importance of putting data in context. When you do that, that's when you're really going to be able to bring really smart judgment and thinking and come out with some sharp learning that's going to enable you to be a better data decision maker.

Yeah, absolutely. And I, I love this is rolling into I. The another question that was really key for me that I wanted to make sure we talked about for the conversation today for people who would not be naturally saying they're math people, right, that they are maybe shy away from, from numbers and calculations and things and say there's a reason that they didn't go into. Into data per se. You know, what do you say to people when they say, like, I'm not good at math, I don't get the numbers. If it doesn't feel intuitive to them, how could they be triggering some of. I love the. That y' all in the book call it the quantitative intuition. Like what Is what does that mean and how can we be honing that for people that say it's not their jam?

The book's premise is really built on and I think it's in the forward. You don't need to go to math camp to make better decisions with data. In fact, and I also teach an executive ed program at Columbia, it's all about using both the left and right hand side of the brain. The model is called quantitative intuition, which you know, for the shorthand it's called qi and it seems like an oxymoron. First of all, quantitative numbers, math, and then intuition. And I have seen over nine years of teaching, of teaching thousands of executives and their comfort level with math and statistics range, as you can imagine widely that you need to have both and both are extremely valuable to make a better decision. So quantitative could be as simple as knowing the right questions to ask and interrogate data. We already talked about a couple on this podcast already putting data in context. Tell me what surprised you. Oh, that's an outlier. You don't need to know statistics and probabilities and that. So there's even some fundamental questions that if you don't go to math camp that you could become a fierce interrogator of data. The intuition part is fascinating because I always receive the question, can you teach intuition? And the answer is yes. Intuition is we are all intuitive at some level. What we all not great at is listening to that intuition or trusting that intuition. Trust your gut. If we really stop and think, a lot of times we say to ourselves, I knew what that answer should be, I just felt it. That is your intuition. And when you think around intuition, you can define intuition along two dimensions. One is confidence, you know how good are you are at something and the other one is confidence. So when you think through these dimensions, when you start out at the lowest level, you don't know what you don't know. You're not confident and you're not confident. Think about when a baby starts to learn to walk. They start surfing along the couch, but they're stumbling. They're not confident and they're not confident. As you move up, you start increasing confidence and competence to the point where you start to do things just intuitively. You don't think about walking. Now think about even. I think another analogy that people may identify with is think about maybe when you started to drive and right after you got your driver's license, you know, you put your hands or they used to teach it at least, you know, 10 and 2 and you know your, you would hold that wheel and you would almost be white knuckled. You're becoming increasingly confident. Then at some point later in life, you drive somewhere, you pull into your apartment, your home, your parking lot, some store you go to, and you're like, oh my God, how did I get here? Which is a little scary. But setting that aside, you know what, that's, you know, you do something for so long for so well, and that is intuition. And I think, you know, listening to that and putting these both halves together, quantitative intuition, using questions to become a fierce interrogator, not necessarily running statistics and then listening to your experience. And I've seen this movie before, putting those together is where that magic of quantitative intuition comes together and that intersection to enable you to start to make better decisions.

Absolutely. I thank you for that. And I actually use the driving example all the time too. And it's one that I think really resonates with people. And I always like to say, if you don't remember it, if you had to teach someone to drive recently, know, sorry about that experience because it's so stressful. Right. But I think that's such a key piece even when we think about changing behaviors in the workplace and we're trying to, you know, so going through a process now where people are saying, okay, I want to do better with understanding the data. I want this to become intuitive for my team and to know it's not like you just sit in the car and you're like ready to drive now. Right. You have to go through the sort of painful learning process of turning it into the habit. Right. Of the system 2 to system 1, that conscious to the subconscious, we have to really put that focused effort to help it to become something intuitive. And that's why we can't do everything all at once. Because if we're spread too thin, you're not going to make that progress. But if we say we want to make this change, this matters for us, we care about better understanding our data and understanding behavior and problems. And so like our team's going to start flexing those muscles and we're going to be doing the work until it becomes more intuitive. And then once this is done, we can move on to the next thing. Right. How we're going to use it better. So yeah, that understanding of the brain is really important as we think about behavior change for sure. And for customers facing of course as well.

And you know, you talk about, you just mentioned the word team. I think what is also that kind of sparks to think around how do you build the right culture? You know, whether you have five employees or 50 or 5,000. And how do you build the culture that really starts to, you know, take the time to understand the behaviors? You actually, you know, challenge them to see the world differently and to start to observe, you know, things that necessarily may not be on the spreadsheet, you know, so I think building this culture is so essential to. Or building a culture is so essential for organizations to succeed and thrive and grow. And some of the techniques we talked about, just introduce one or two of them. Culture is rocket fuel to growth. And if you try to introduce a new framework or a framework period, The organization, you know, could reject it. So, you know, I love where you talked about, you know, how do you start to build this team? Start to just take one or two lessons, you know, from, from the book. And obviously you wrote and published a number of books on this topic, but, you know, start to just apply one or two of these lessons and you start to understand, you know, whether, you know, what you wrote about, you know, what's the truth about pricing or how do you make better decisions. And I think that is when you start to take initial steps to build a culture that is really poised to grow and show up differently.

Absolutely.

Well, thank you for all of those points and that wonderful summary and so excited for the book.

Is there one question that you wish.

I would have asked as we go to wrap up the show here?

That's a great question. You know, there is. So I, you know, what new skills or what skills should people really focus on growing and developing? And that is, you know, I think, an essential question, because people that are continuous learners, people that really want to challenge their organizations to show up differently, challenge the status quo in the best way, they constantly have to be building a core set of skills and building the toolkit. That's a question I get often, regardless of experience, everything from, from the new graduate that may just starting out early in their career, early tenure, all the way up to. And I work with a lot of CXOs, so what are the skills that I need to be developing? And I would say, and I'm going to go back to be a great questioner, and I'm going to. We talked about that earlier, but now I only want to put it in context of AI. Everyone is talking about AI. No one knows where AI is going. But one of the essential skills you could develop, whether you're in the boardroom, whether you're on a project team, whether you're early in your career or seasoned in your career, working with the latest technology, working with data, or working on something creative is the ability to question and within AI, it's called prompt engineering, which is another fancy way of saying how do I interrogate, how do I ask questions that's going to give me and solicit the information I need. So there's one thing that I would recommend as continue to build your skill is within AI. Really focus your time and energy on developing that muscle around prompt engineering. If you're not working with AI but you're in a meeting or doing a deck review, or presenting or meeting with clients or trying to help clients develop a better strategy, really ask questions and learn the science around asking smarter questions because it is what is going to lead you to a better strategy and those surprises and more profitable outcomes that will help you grow.

Wonderful.

Well, definitely puts a bow on the conversation. So thank you so much for all of those thoughts and insights. For everyone who is so excited to go get their copies of Decisions Over Decimals and to learn more about you, we will of course have links in the show notes including to connect with you on LinkedIn and whatnot. Thank you again Christopher for joining me on the show. It was delightful to chat with you.

Today, so it was terrific. Thank you for having me. Take care.

Thank you again to Christopher Frank for joining me on the show today. What got your brain buzzing in today's conversation? For me, I really enjoyed reading this book because there's a ton of overlap for me with the same concepts and studies I would consider my own go tos. But in many ways Christopher and his co authors talk about them in a completely different way than I often do. It's really eye opening to be reminded that the way I see or share something isn't the only way something you hear me talk about a lot. So I love to see how others connect the dots with the same mix of information. It's like if all the same slips of paper with ideas and concepts and research studies were put into a hat and we each pulled them out one by one. The story was created differently and they can both be right, which is super cool. This really ties into the insights and conversation I'm having with Nobel Prize winner Bob Lefkowitz. On next week's episode, he has a story from early in his career where he was asked to use the same data to tell a different story and talks about how formative that was for him and his work. I won't share all the details now, of course, because you definitely want to hear him tell about it. If you aren't already subscribed to the Brainy Business podcast, now is a great time to do so to ensure you don't miss that episode or any others when they come out. As we close out the show, don't forget about those show notes, which include links to my top related past episodes and books including decisions over decimals, ways to get into touch with Chris and myself, and more. It's all waiting for you in the app you're listening to and atthebrainybusiness.com 425. And thank you again to Christopher Frank for joining me on the show today. It was a delight to chat with and learn from you. Join me Tuesday for another Brainy episode of the Brainy Business Podcast. It's going to be a lot of fun. You don't to want want to miss it. Until then, thanks again for listening and learning with me and remember to be thoughtful.

Thank you for listening to the Brainy Business Podcast. Melina offers virtual strategy sessions, workshops and other services to help businesses be more brain friendly. For more free resources, visit thebrainybusiness.com.