Books

Thinking, fast and slow

I have read several thought provoking books but this one by Nobel prize winner Daniel Kahneman gives insights into our very own thought process itself. We keep hearing about stepping back to rethink and are encouraged to “think through” before acting – this book explains why they are required.

All my life, I was under the impression that intuition is a talent and a gift. After reading this book, I realized that we should be careful about our intuition and that common sense typically produces ordinary results!

My biggest learning from this book is that there are two systems that help us think and make decisions:

  • System 1 – the fast paced “automatic operation” or “intuitive thought” driven by amygdala, a primitive part of our brain.
  • System 2 – relatively slow paced “controlled operation” or “deliberate thought” driven by neo-cortex, the most distinctively human feature of our brain.

While invoking system 2 for any decision will ensure thorough analysis and reduce mistakes, we may not always have the luxury of time and energy required for it. So, we will have to rely on intuition for a number of day to day decisions. And this is where understanding the two types of intuition comes in handy.

  • Expert intuition: Thousands of hours of practice leads to expertise – Malcom Gladwell’s “Outliers” explains this well through the 10,000 hour rule. While this rule is contested by some, it is still a good framework for understanding expertise. Now, any situation where we need to make a decision will invariably provide a cue that an expert will sub-consciously detect. This cue gives the expert access to information stored in memory and the information provides the answer. Expert intuition is just recognition!
  • Heuristic intuition: When faced with a difficult question, we often substitute the original question with an easier one without noticing the substitution. The resulting easier question will be one for which we readily have an answer, which will invariably be based on our biases. I have observed many leaders form “perceptions” about people and now I understand it should be because of their heuristic intuition!

Whenever I have an intuition or gut feel nowadays, I ask myself if this is due to expert intuition or if this is influenced by heuristics or biases. Expert intuition is good – in fact, what is the point of earning expertise through hard practice if we are not going to use it! But heuristic intuition is bad, leading to bad decisions that leaders in particular should avoid as it can adversely impact their people! So, the healthy alternate is switch to slower, more deliberate and effortful form of thinking whenever we suspect heuristic intuition.

This book is a beauty and took more than a couple of months for a slow reader like me to complete. It will be a long blog post and will take several hours for me to write about everything I learnt. So, I will summarize with some quick pointers to key concepts:

  • Law of least effort – if there are several ways of achieving the same goal, we will eventually gravitate to the least demanding course of action. Laziness is built deep into out nature.
  • Cognitive Ease – when we are in a good mood, we are likely to be casual and superficial in our thinking. Don’t get “carried away”!
  • Jumping to conclusions is efficient if the conclusions are likely to be correct and the costs of an occasional mistake is acceptable, and if the jump saves much time and effort. It is risky when the situation is unfamiliar and the stakes are high.
  • The law of small numbers – statistics can help when the sample size is large enough and comprehensively representative. Conclusions made based on small numbers will not be prudent as they assume a simpler world than reality and ignore that many facts are due to “chance”.
  • Regression to the mean – whenever someone produces extraordinary and outstanding results, an element of chance is likely to be one of the reasons. Over a period of time, the results will converge towards the average.
  • Illusion of understanding – hindsight information is often misunderstood as prophetic knowledge. A number of books that analyze past events and postulate a recipe for future success have fallen flat over a period of time. A classic example will be “Build to last” – the gap in corporate profitability and stock returns between the outstanding and the less successful firms studied in this book shrank to almost nothing subsequently! How about this? – the CEO of a successful company is likely to be called flexible, methodical and decisive. If the firm slips the next year, the same executive will be called confused, rigid and authoritarian! The same actions can be conveniently depicted in positive or negative terms creating an illusion of profound understanding of the presenter!
  • Prospect theory, loss aversion & the endowment effect – These are profound concepts:
    • Reference points exist – A specific amount of money does not have the same value for everyone. A person earning $1000 a month will be a lot more excited about $100 than someone who earns $10,000 a month. This explains why hikes are measured in % rather than absolute amounts!
    • Losses loom larger than gains – we give up on gains more readily than incur losses. A reason why people cling on to losing propositions for long and end of losing even more rather than exit early to cut losses!
    • A luxury becomes a necessity over a period of time as we get used to it.

There is a lot more to read and learn from this book, which is currently #1 best seller under Cognitive Psychology eTextbooks in Amazon. I have just provided an appetizer here and the book will be the main course. And I promise the main course will be much better than the appetizer. Go for it!

Sapiens & Home Deus: Amazing duo

The first book I read on anthropology was Guns, Germs & Steel, way back in 2005. While I enjoyed the insights and talked about it for a long time, it was not yet time for me to develop my reading habit. So, it took half a dozen years before I started on the next anthropology book – Collapse, incidentally by the same author Jared Diamond. By this time I was quite deep into reading non-fiction and a steady stream of great books enriched my knowledge across history and anthropology. Special mention among them would go to The Naked Ape and Origin of Species for being focused on anthropology.

By the end of 2017, I became a believer of science and encountered two enlightening books by Yuval Noah Harari that took my understanding to the next level. Sapiens gave concrete shape to the vague idea I had around how humans came to rule the world. And its sequel Home Deus painted a plausible picture of what future holds for us! It was sheer awesomeness to realize that the beginning of history was only 70,000 years ago with cognitive revolution. And how lucky we are to have gotten the accidental genetic mutations that changed inner wiring of our brains! It is difficult to comprehend that before cognitive revolution, history was just biology, with human life following predetermined pattern like any other animal – dictated by instructions encoded in their DNA!

One should read the book to appreciate the profoundness. The insights at the end of the book are compelling, comparing conventional thinking with contemporary science.

Conventional Thinking Data Science
I am an individual Organisms (including us) are algorithms
My authentic self is completely free My decisions are shaped by genes and environmental pressures
I know things about myself that no one else can discover An external algorithm can theoretically know me better than I know myself

Now that I am wiser, what next? Time to embrace the prophecy and prepare for the future! I started learning TensorFlow and instantly understood that the future of programming is in machine learning. As I started appreciating science, I also realized that Mathematics enables science. Math skills are becoming increasingly key to success in computer science and programming.  And Math skills are fundamental to machine learning! Lot more to learn and that keeps life interesting!!!

Books 2017

As I wrote the blog on books I enjoyed in 2016, the realization stuck that I had slipped from reading habit during the previous year and a half. After finishing more than two dozen books each in 2013 and 2014, I had read only a couple of them in 2015. While I thought it was primarily due to extensive time spent during the weekends for cycling / running / recovery time, it also coincided with my taking up a new job towards the end of 2014. It took another year to sense knowledge debt building up again as my effectiveness as a speaker and motivator for my teams diminished a bit. When I read a book on leadership or anthropology, I immediately relate it to events around me and apply some of the learnings. This happens sub-consciously and I realized it only when while introspecting on recently diminished effectiveness.

In April 2017, I made efforts to restart my reading habit and made one of the best investments in recent times when I bought Kindle Paperwhite. I would later know from “The Everything Store” on strategic thought process from Jeff Bezos and Amazon that went in building an eBook Reader that would be affordable with a comprehensive book store behind it. I can vouch for it after using it for about ten months. You can pretty much find any English book ever published  and at a price that is most competitive! With backlight, I can now read without disturbing the rest of my family and e-ink technology lets Kindle run for days together on a single charge! I might sound like an Amazon marketer, but really admire the value Kindle brings with it!!!

I started with “Great by Choice”, a book by Jim Collins whose “Good to Great” was one of the books that got me interested in non-fiction. It was on familiar Jim Collins style and I could relate to some of the principles that I always followed in my life. No wonder I am great! – just kidding. It was just reassuring to know that some of my principles are good for long-term success. The quote from Roald Amundsen, the first man to The South Pole will always be etched in my memory: “Victory awaits him who has everything in order – luck people call it. Defeat is certain for him who has neglected to take the necessary precaution in time; this is called bad luck”.

From “Great by  Choice”, I got reference to another couple of fantastic books that demonstrated Jim Collin’s theory about the best leaders being more disciplined, more empirical and more paranoid. They were the next books I read – “Scott And Amundsen: The Last Place on Earth” and “Into Thin Air: A Personal Account of the Everest Disaster”.

It was then time for “Losing the Signal: The Untold Story Behind the Extraordinary Rise and Spectacular Fall of BlackBerry”. I got this from reading recommendations given by one of the senior leaders in my organization.

After my Europe trip, I wanted to know more about the history of Europe and particularly on what happened to Roman Civilization. It took almost four months to complete all the six volumes of “The Decline and Fall of the Roman Empire” written by Edward Gibbon in 1770. A true classic like “The Origin of Species” by Charles Darwin and worth the effort.

After immersing in history for several months, I wanted to read about some contemporary achievements and went back to the reading recommendations. I read books on two of the modern great companies on Technology space – “The Everything Store: Jeff Bezos and the Age of Amazon” and “The Google Story”. In between, I also finished “Hit Refresh: The Quest to Rediscover Microsoft’s Soul and Imagine a Better Future for Everyone” within a few weeks of Satya Nadella releasing it. All of them reinforced the need for discipline, work ethic and team work – there is no short cut to success! That rounded up 2017, a fulfilling year for reading good books. As I write this, I already finished reading “The Great Convergence” that I got referred from Hit Refresh. More about that when I write about by 2018 experience.

My reading list from 2017:

Hit Refresh: The Quest to Rediscover Microsoft’s Soul and Imagine a Better Future for Everyone Satya Nadella
The Google Story David A. Vise
The Decline and Fall of the Roman Empire (Edited and Abridged): Abridged Edition Edward Gibbon
The Everything Store: Jeff Bezos and the Age of Amazon Brad Stone
Losing the Signal: The Untold Story Behind the Extraordinary Rise and Spectacular Fall of BlackBerry Jacquie McNish
Sean Silcoff
Into Thin Air: A Personal Account of the Everest Disaster Jon Krakauer
Scott And Amundsen: The Last Place on Earth Roland Huntford
Great by Choice: Uncertainty, Chaos and Luck – Why Some Thrive Despite Them All Jim Collins