The Power of Thinking Differently

Hello and welcome to the Curiosity Chronicle, a weekly podcast where I provide actionable ideas to help you build a high performing, healthy, wealthy life. Today's podcast is brought to you by AG1 by Athletic Greens, my all in one daily supplement. Seriously, I've been taking this stuff every single day since 2011 for a reason. To find out why, go to drinkag1.comsahil and take advantage of a limited time offer. Now onto today's the Power of thinking differently in 2009, a Stanford business professor named Tina Selig split her class into groups and gave everyone a challenge. Each group would have $5 and two hours to make the highest possible return on the initial money. At the end of the challenge, each group would give a short presentation to the class on their approach and results. The results of the challenge were fascinating. Most of the groups took a linear, logical approach. Use the $5 to buy a few items, barter with those items, resell or trade them for items of higher value. Repeat sell the final items for something, hopefully more than $5. These groups made a modest return on their initial five. A few groups ignored the $5 and instead thought up ways to make money in the two hours of allotted time. Made and sold reservations at hot restaurants in town Refilled bike tires in the center of campus for a dollar each. These groups made a better return on their initial five. The winning group also ignored the $5 but took an entirely different approach. They realized that the most valuable asset was not the $5 or the two hours of time for the challenge, but the presentation time in front of a class of Stanford students. Realizing the value of this asset, they sold the presentation time to a company looking to recruit Stanford students for $6, netting a monstrous return on the initial $5 of capital. The losing groups thought in linear logical terms and achieved a linear logical outcome. The winning group thought differently. Three Steps to Think Differently There are two types of challenges we face. Low stakes lower potential linear rewards decisions are easily reversible or 2 high stakes higher potential asymmetric rewards decisions are not easily reversible with low stakes challenges. Given the reward potential is low and the decisions are easily reversible, we can use shortcuts and heuristics to choose our path. We can take a logical linear approach with high stakes challenges. However, the high asymmetric reward potential means we need to think differently. We need to take a creative, nonlinear approach. Let's generalize the learnings from the Stanford business class story and adapt three steps for thinking differently in these high stakes situations. Step one avoid the distraction in the challenge the $5 was the trap. Most of the groups immediately anchored their thinking around the $5 because it was positioned as the asset that the groups needed to focus on leveraging to make a return. In reality, it was nothing more than a distraction. It was entirely possible that the best solution may have involved the $5. But by narrowing the entire field of solutions to those that were centered around the $5, the groups had limited their field of vision significantly. When faced with a challenge with the potential for outsized rewards, the first thing to do is make sure to avoid the distraction. There will always be an obvious solution that is simple, clear, and entirely wrong. Before you select it, make sure you complete step 2. Step 2 Ask foundational questions Socratic questioning or the Socratic method, is a simple process of asking and answering questions that stimulate critical thinking to expose and vet underlying assumptions and logic to put it into action. Follow this general structure. Start with open ended questions. Propose ideas based on those questions. Probe these ideas with progressive questioning and repeat until the best ideas are developed. Here's a process of how you might apply Socratic questioning. Start asking questions what's the problem you are trying to solve? We often waste time and energy trying to solve the wrong problem. Identify the right problem before you try to solve it. Propose your current thinking on the problem. What is your hypothesis? What are the origins of that thinking? Open the floor for targeted questioning. Why do you think this? Is the thinking too vague? What is it based upon? Challenge the assumptions underlying the original thinking. Why do you believe this to be true? How do you know it's true? How would you know if you were wrong? Identify the sources of belief on a problem. Be ruthless in evaluating their integrity and validity. Evaluate the evidence used to support the thinking. What concrete evidence do I have? How credible is it? What hidden evidence may exist? Understand the consequences of being wrong. Can an error be quickly fixed? How costly is this mistake? Always understand the stakes. Evaluate potential alternatives. What alternative beliefs or viewpoints might exist? Why might they be superior? Why do others believe them to be true? What do they know that I don't? Evaluate them on their merits and ask these same fundamental questions about them. After zooming in, zoom out. What was my original thinking? Was it correct? If not, where did I err? What conclusions can I draw from the process about systemic errors in my thinking? Socratic questioning takes time. It shouldn't be used on low cost, easily reversible decisions. But when you encounter a high stakes decision with the potential for asymmetric rewards in your business, career or life, it's worth engaging in the exercise. Step 3 Select the leveraged Approach Once you've avoided the distraction and leveraged Socratic questioning to expose flawed assumptions and ground yourself in the appropriate ones, you are ready to make a decision on the optimal path forward. The winning group selected the path of selling the presentation time as the path with the highest leverage and likelihood of success. You can do the same. Slow down and select the path most likely to generate the asymmetric risk adjusted returns. How to Think Differently when faced with an important challenge with the potential for nonlinear Rewards, follow these three steps. 1. Avoid the distractions. There's always an approach that seems obvious and simple but may be entirely wrong. Avoid falling for the trap. 2. Ask foundational questions. Strip away flawed assumptions and ground yourself in foundational ones. Use Socratic questioning to unpack the problem and 3 select the leveraged approach. Select the highest leverage approach with the highest likelihood of success. Slow down and identify the true assets and points of leverage in the system. Use them to your advantage. Remember, creative nonlinear asymmetric thinking generates creative nonlinear asymmetric outcomes. That's all for today's piece. I hope you enjoyed it. I hope you learned something and I hope you'll share it with others. As always, until next time, stay curious friends.