Seeking Wisdom

by Peter Bevelin

  Keep in mind

  Evaluate the truth of a statement on the basis of its underlying facts, without regard to the authority's personal qualities or social status.

  Anyone can call themselves an expert. Separate between real and false experts.

  An authority may have an interest in persuading you to believe something that

  90

  is in their interest. Always consider reliability, credibility, sensibility and bias. To insure their trustworthiness, authorities often mention weaknesses before strengths and provide information that seems contrary to their interests. This technique is often used by salesmen and negotiators.

  SENSEMAKING

  "We understand life backwards but live it forwards. "

  Soren Aabye Kierkegaard (Danish philosopher and theologian, 1813-1855)

  "There has to be a reason!"

  The 19th Century playwright and poet Oscar Wilde said: "The public have an insatiable curiosity to know everything, except what is worth knowing."

  We don't like uncertainty. We have a need to understand and make sense of events. We refuse to accept the unknown. We don't like unpredictability and meaninglessness. We therefore seek explanations for why things happen. Especially if they are novel, puzzling or frightening. By finding patterns and causal relationships we get comfort and learn for the future

  TransCorp hired a team of people to find out why the new product failed.

  What did we do wrong in this case? There is a difference between: "Why did it happen?" and "What can cause this to happen?" The team looked for the specific factors that caused their new product to fail. They may learn more from asking: Why do new products fail? What general reasons are there? What key factors influence product failures?

  "It is easy to be wise after the event, "says Sherlock Holmes in The Problem of Thor Bridge. We read the present into the past. After an event, we know how things turned out. When trying to make sense of what has happened, we construct a plausible story or explanation that fits the outcome. But there are many ways an event or behavior can later be understood. There may be many contributing factors that fit the outcome, chance may be involved, or our guessed causes may also be consistent with other outcomes, including the opposite or prevention of the outcome. Ask: Could our explanation of the event help us predict future similar events?

  This is the danger of relying on case-based stories. Stories may be selected to prove something and may give us a delusional sense of clarity. Knowledge about outcomes may also cast some doubt on reconstructions of historical events (given that the historian was not there). History is often composed of various events all coming together.

  91

  History is also explained by what has survived into the historian's present. Not all sources survive. Not everything gets recorded, memories are unreliable, evidence may be destroyed or deliberately ignored, and some things may be too embarrassing to mention. When Oliver Cromwell's portrait was painted, he told the artist. "Remark all these roughnesses, pimples, warts, and everything as you see me, otherwise I will never pay a farthing for it."

  We also seem to have a tendency for romanticizing past achievements. John Waller, Lecturer in the History of Medicine at the University of Melbourne, says on scientific discoveries in Einstein's Luck: "Many biographies seem to have been written to glorify idols, ancestors, disciplines, or even the nations in which the scientists lived and worked."

  "Why was he so stupid? How could hehavedone that? It was obvious it would happen. " The 19th Century Russian writer Fyodor Dostoevsky said: "Everything seems stupid when it fails." In hindsight, everything seems obvious. But we should look at earlier decisions in the context of their own time. Perhaps the actions made sense at the time. We don't know what uncertainties, conditions, or situational factors faced the decision-maker. Good decision-making can lead to bad outcomes and vice versa. If we believe that we predicted the past better than we did, we may also believe that we can predict the future better than we can. The Romanian dramatist Eugene Ionesco said: "You can only predict things after they've happened."

  "The oil price will stabilize at $60."

  How do they know that? In the Cato journal Distinguished Professor Deirdre McCloskey said: "If you desire a ride to Baghdad, here is a magic carpet; if you desire your enemy dead, here is a magic doll; if you desire unlimited riches, here is a forecast of interest rates." We like it when people tell us what the future will look like. It reduces uncertainty. It doesn't matter that no once can predict the future, we willingly pay for the existence of future-tellers.

  Charles Munger says: ''Around here I would say that if our predictions have been a little better than other people's, it's because we've tried to make fewer of them."

  '1t couldn't have happened by chance. There must be a reason. "

  We see faces in inkblots and patterns in the movements of stocks. We find meaning in coincidences. We underestimate the influence of chance. We want to find reasons for all kind of events - random or not. And if we don't find any, we construct them. We then choose the things that fit an intended pattern and

  92

  ignore the rest. Studies show that we even try to figure out a pattern when we are told a process is random.

  In one experiment, two lights were set up and flashed in a random sequence. Before each trial, research subjects tried to guess which of the two lights would appear. The studies showed that they tried to match the frequency of previous occurrences in their guesses. Similar studies showed that rats or pigeons instead chose

  the alternative that came up most frequently. If we assume that a red light occurs

  with a frequency of 80% and a green light with a frequency of 20%, we should bet on the most likely outcome every time: red. We then guess right 80% of the time. Trying to match the frequency only gave the right answer 68% of the time.

  An example of our tendency to see patterns that aren't there is when we use unreliable tests for evaluating people. A test is reliable if it gives about the same result when repeated assuming the test measures a characteristic that is stable over time. A test is valid if it accurately measures what it claims to measure. Take the Rorschach inkblot test as an example. One problem is that the test classifies a large percentage of normal individuals as psychologically disordered. Can we evaluate personality by studying how an individual perceives a series of inkblots? Interviewers can read into it whatever they wish to see. This test is still used today although research has shown that it allows for countless interpretations and has no predictive value.

  "Once upon a time in the land of .. "

  We are quick to draw conclusions. Author and entrepreneur Seth Godin tells a true story in his bookAllMarketersAre Liars. In the 1980s, some businessmen bought some branded stereo speakers and packed them into a truck. They parked the truck behind a dorm at Harvard and started whispering "Pssst... Hey! You wanna buy some speakers?" They never said that the speakers were stolen but passersby assumed they were. They therefore had to be a bargain. The businessmen sold out in no time. Even if the speakers cost a little more than they did in the local store.

  We love stories and story-telling. Good stories and drama get our attention. They give meaning to events. We rationalize decisions and justify choices by telling ourselves comforting stories. We use stories to understand, remember and make sense of events. But sometimes we have a hard time separating a true story from a false one. After an event a story is created so that the event makes sense. Remember that a story can have many possible beginnings (and endings).

  Keep in mind

  Look for alternative explanations and what normally happens. Think about general reasons.

  93

  Consider how other possible outcomes might have happened. Don't underestimate chance.

  In hindsight, everything seems obvious. If we look forward, there are many

  possible outcomes.

  REASON-RESPECTING

  "Please would you tell me," said Alice, a little timidly,
"why your cat grins like that?" "It's a Cheshire Cat,"said the Duchess, "and that's why. "

  Lewis Carroll (British mathematician and writer, 1832-1898, from Through the Looking Glass)

  Our need for making sense makes us even believe in nonsense.

  In one experiment a social psychologist asked people standing in line to use a copying machine if she could go in front of them, "Excuse me, I have 5 pages. May I use the Xerox machine because I have to make some copies?"Nearly all agreed.

  When people ask us for a favor we are more likely to comply if they give us a reason - even if we don't understand the reason or it is wrong. Often it isn't the reason itself that is important, but the way the reason is phrased. Sometimes the word "because," without a sensible reason, is all that matters. We want explanations and the word "because" imply an explanation.

  Carl Braun, the creator of CF Braun Engineering Company, understood the importance of telling people "why." Charles Munger tells us the story:

  His rule for all the Braun Company's communications was called the five W's - you had to tell who was going to do what, where, when and why. And if you wrote a letter or directive in the Braun Company telling somebody to do something, and you didn't tell him why, you could get fired. In fact, you would get fired if you did it twice.

  You might ask why that is so important? Well, again that's a rule of psychology. Just as you think better if you array knowledge on a bunch of models that are basically answers to the question, why, why, why, if you always tell people why, they'll understand it better, they'll consider it more important, and they'll be more likely to comply. Even if they don't understand your reason, they'll be more likely to comply.

  So there's an iron rule that just as you want to start getting worldly wisdom by asking why, why, why in communicating with other people about everything, you want to include why, why, why.

  "Why should we do this? Why should we do it this way?" ''Because this is how we always have done it. "

  94

  We should not only give people reasons for what to do but should also encourage flexibility. Ask them to question procedures and whether what appear to be self evident truths are really good for the business. Ask why, ask why, and ask why again. The third why often gets down to the real issue.

  "How can I use what I don't understand?"

  Understanding reasons is an important factor in learning. To learn, remember, organize, and use ideas, we must understand the "why" and "how." There's no use memorizing what we don't understand. If we don't understand the meaning of an idea, we don't use it. What we don't use, we forget. We also need to be motivated to learn. And we can't be motivated if we don't understand why we need to learn something. We need to see its practical use.

  Understanding is about the ability of seeing patterns - how ideas and things relate and hang together. Knowledge that can be used in a variety of situations.

  Our brains favor the concrete and practical over the abstract and theoretical. We are especially good at remembering images and spatial information. We therefore learn better if the use of ideas and patterns are illustrated through pictures and simple, clear and vivid real-life stories. Stories on what works and what doesn't work increase our ability to retain what we've learned.

  Aristotle said: "For the things we have to learn before we can do them, we learn by doing them." This means we need to practice what we have learnt in various situations.

  We also need an organizing framework in order to better retrieve and use knowledge. Charles Munger adds: "You can't really know anything if you just remember isolated facts and try and bang 'em back. If the facts don't hang together on a latticework of theory, you don't have them in a usable form."

  Keep in mind

  People can't be persuaded by what they don't understand. We underestimate the importance of giving people a reason. It is often easier to get people to change with a well-explained reason backed by solid evidence. Tell them so they understand why a specific action is needed, what the expected objective is, and why you think the action is right.

  Of course, this doesn't work in every case. Sometimes you don't change people's opinions by showering them with logic. In Jonathan Swift's words: "You cannot reason a person out of a position he did not reason himself into in the first place." Aristotle adds: "For argument based on knowledge implies instruction, and there are people whom one cannot instruct." Sometimes it is

  95

  better to appeal to emotions than to reason since people are more moved by what they feel than by what they understand.

  BELIEVE FIRST AND DOUBT LATER

  "Our new product is very good for you for the following reasons. .. "

  We start assuming that the product is good for us and look for evidence that confirms it. We believe people when they give us reasons. We believe that people are telling us the truth, even when they are not.

  We are not natural skeptics. We find it easy to believe, but difficult to doubt. Doubting is active and takes effort. Bertrand Russell said: "Believing seems the most mental thing we do." Why? Because we have to believe in order to understand.

  Studies show that in order to understand some information we must first accept it as true. The 17th Century philosopher Benedictus de Spinoza argued that understanding and believing are simply two different words for the same mental process. We first believe all information we understand and only afterwards and with effort do we evaluate, and if necessary, un-believe it. Studies show that Spinoza was right. We automatically and effortlessly believe what we see and hear and only afterwards (sometimes) with effort do we doubt and ask questions. Psychology Professor Daniel Gilbert says in his study How Mentals Systems Believe: "Having comprehended and accepted an idea, Spinoza considered persons entirely free either to unaccept or to certify it."

  Studies also show that the more distracted or pressured we are (and therefore prevented from thinking things through), the more likely we believe in something we normally would find dubious. Whether we think things through or not depends on our motivation and ability.

  Believing something that is false may sometimes come with a benefit. For example, studies show that if students are told they are above average on a subject, they will do better.

  How successful are people at deceiving us?

  Can we catch a liar? We don't seem to be good at telling a truth from a lie. Studies show that people - even professionals - are slightly better than chance at distinguishing truths from lies. We seem to be better at judging when people are telling the truth than when they are telling a lie. Michel de Montaigne said: "If falsehood, like truth, had only one face, we would be in better shape. For we would take as certain the opposite of what the liar said. But the reverse of truth has a hundred thousand shapes and a limitless field."

  96

  Keep in mind‌

  When dealing with important issues think things through and avoid distraction.

  MEMORY LIMITATIONS

  Everyone complains of his memory, and no one complains of his judgment.

  Francois Due de la Rochefoucauld

  Our memory is selective. We remember certain things and distort or forget others. Every time we recall an event, we reconstruct our memories. We only remember fragments of our real past experiences. Fragments influenced by what we have learned, our experiences, beliefs, mood, expectations, stress, and biases. Certain experiences create strong feelings and are therefore more memorable than others. Dramatic or fearful experiences or events stick in our memories. Emotional events are better remembered than unemotional ones. That is why we learn better if information is tied to a vivid story. Learning is also tied to mood.

  We learn better in a positive mood. That is why teaching should be performed in a way that creates powerful positive emotions among students.

  Psychology Professor Daniel Schacter, proposes in The Seven Sins of Memory

  that our memory's malfunctions can be divided into seven "sins."

  (1) Our memory weakens and we l
ose memory over time. (2) We are preoccupied with distracting issues and don't focus attention on what we need to remember. (3) We search for information that we may be desperately trying to retrieve - something we know that we know - but are blocked. (4) We assign memory to the wrong source. (5) Memories are implanted as a result of leading questions, comments, or suggestions when we try to call up a past experience. (6) Our present knowledge influences how we remember our pasts. We often edit or entirely rewrite our previous experiences. (7) We recall disturbing events that we would prefer to eliminate from our minds altogether: remembering what we cannot forget, even though we wish that we could.

  Individuals remember the same things differently. We remember events that never happened or assign what happened to the wrong place, time or person. Studies show that memories of emotional experiences are often different from what actually happened. We misinterpret what we saw. That is why there are variations in eyewitness accounts. Many cases show that eyewitness identification evidence has been a significant cause of wrongful convictions. Especially the accuracy of eyewitness identification of strangers.