Dan Ariely on behavior, honesty, and rationality

Dan is one of the most popular behavioral economists in the world today. His books and research have had huge impact on our understanding of how our minds work. I finally managed to find a slot in Dan’s schedule after a year of trying and was greatly looking forward.

EB and I caught Dan in a very thoughtful and reflective mood. He had just finished speaking to a recent burn survivor and discusses his reflections during the interview. I am very thankful to Dan for all his great work – I’ve learnt a lot from him and it was a privilege to meet him on Skype.

I hope you enjoy the interview as much as we did.

As always, my favorite bits –

“There are a lot of things we do in terms of designing the world around us that if we understood human nature we would do very differently. I think it’s an amazing time for social science to try and help us redesign the world in a better way.”

On government intervention to ‘save us from ourselves’ – “To me, there are two principles that we need to think about. The first one is, is this intervention driven by data or not? And the second thing is to figure out how to weigh human freedom compared to human benefits.”

“I look at the whole world, and then I say, “Is this a place that is the outcome of 7 billion rational people? If everybody was perfectly rational this would have been the best world imaginable. If this world is not the outcome of 7 billion rational people, maybe we can do better. My hope is that as we’re learning more we will improve things.”

“When I get tired of one task, I move to another one. when I get tired of one task, I move to another one.”

“It just amazed me that you can put something out there in the world and people read it and think about it and take it seriously and maybe make a better decision or two. It’s such a tremendous feedback and motivation.”

Full transcript on RealLeaders.tv. Enjoy!

On the Willpower Guide to Weight Loss

This week’s book learning is from Willpower by Roy Baumeister.

After decades of research in the subject of willpower and self control, Roy Baumeister and John Tierney give us a fully scientific approach to weight loss.

1. Never go on diets. Drastic reductions are best never done. As evolution has made sure, our body copes by making sure it binge eats just in case ‘famine’ hits again.

2. Start with pre-commitments.

  • Begin by keeping fattening food out of reach and out of sight – office workers ate a 3rd less candy when it was kept inside a draw.
  • Simple commitment strategy to avoid late night snacking is to brush your teeth right after dinner. This adds resistance and makes snacking seem less attractive.

3. Make implementation intentions. If you are going to a buffet, say to yourself “I will eat only vegetables and lean meat” – this makes following it an automatic process.

4. Keep a food diary/log.

5. Place a bet with a bookmaker or with a friend. Name a realistic goal and put a tough penalty – losing 5-10% of weight is a realistic goal to start with. Losing more than 2 pounds a week is unrealistic.

6. Spend time with fit people. People reinforce behaviors and standards. Obese people cluster together and the same happens with smokers and alcoholics. Peer pressure and culture are why people in Europe weigh less than those in America because social norms don’t allow snacking during the day.

7. Maintain steady supplies of willpower. Eat regularly and get adequate rest so your willpower reserves are steady.

Finally, take your time to reach your goal and don’t let up. Keep up incentives to maintain weight.

clip_image001Maintain steady supplies of willpower for a better life..
Sketch by
EB

I hope you enjoyed the series of learnings from Willpower. In case you ever need a refresher, do check out our learnographic.

A few thoughts on French Polynesia

We took our post-wedding trip to French Polynesia. We chose French Polynesia as it was a far flung destination we would not have gone to otherwise. It took us about 30 hours to get there but boy, was it worth it. French Polynesia is home to gorgeous lagoons i.e. shallow bodies of water separated by reefs. Here is a French Polynesia primer in case you ever plan to take a trip there.

1. French Polynesia is a collection of islands in the South Pacific. It is between New Zealand and South America and south of Hawaii. The best way to get there is via Auckland, Tokyo, or Los Angeles.

2. They boast among the most beautiful beaches in the world but still suffer from relative obscurity. On the one hand, this makes it a lovely tourist destination but on the other hand, the tourism business is still struggling. One reason for that is unstable governance. They’ve had 7 or so government changes in the last decade and that doesn’t help.

3. French Polynesia has 4 groups of islands and the “Society” group are the most popular of the lot. Tahiti, Mo’orea, Taha’a, and Bora Bora form the tourist circuit.

4. Thanks to the large number of reefs, they are really great for diving enthusiasts. They are great for snorkelling too and you get treated to all sorts of marine life including large lemon sharks – a real life experience.

5. French Polynesia can range from mid-budget to extremely expensive. Since the economy is more or less built on tourism and since it is located so far away from civilization, it isn’t cheap by any standard but it isn’t helped by the fact that most tourism advertising is done by the big resort chains. There are many places for cheap/mid range accommodation and it is worthwhile thanks to the huge number of marine activities and the gorgeous views.

6. The locals are lovely island folk. They are typically engaged in fishing, farming, or tourism and are all friendly, warm and fun loving. Most of the pensions (i.e. cheap/mid-range accommodation) are owned by French settlers. French is the common tongue but most are familiar with English. Their dances, music, and love for coconuts had lots of similarities with South Indian customs.

7. Air travel between the islands is a lot of fun. All the airports are old air force bases and have cats walking around. There is no security check whatsoever and you are free to carry whatever you want into the plane. And of course, no need to switch of devices when you take off and land!

8. So, when should you plan a trip to French Polynesia? Any time really! Since it’s a huge distance away from most places except the West Coast of the US, Australia, New Zealand, and parts of South America, it makes sense to look for landmarks. There were tons of honeymooners, many celebrating their 10th, 15th, 25th wedding anniversaries with their families, among others.

Planning a trip to French Polynesia is not an easy task since information is scarce. We had a lot of help from a friend and my primary motive in writing this post is to offer help to you if you ever need it. Please just send me a note and I’ll be more than happy to help.

It’s a great place for celebration and just as a taster, I’d like to leave you with a few pictures. I only wish they did justice to the real thing..

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View from the Magic Mountain in Mo’orea

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Vahine Island – a small island off Taha’a

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Bora Bora’s lagoon from the plane. Bora Bora is the most picturesque island.

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Stingrays in very shallow lagoon water (4 feet)

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Sudden dip in depth of lagoon water in Bora Bora

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A better photographer would have converted this into a desktop wallpaper

Who is buying and who is selling

The assumption when a candidate goes into a job interview is that the candidate is selling and the interviewer is buying. It’s similar when a prospective tenant is viewing a home – the tenant is the default buyer while the owner’s letting agent is the seller.

But, let’s consider the following situation – the candidate has 2 great job offers while the interviewer has been desperately trying to fill that particular position for many months. Similarly, the home is one that “rents itself” while the tenant is at a point of desperation in his search for homes.

As a wiser friend pointed out, when you walk into a buyer-seller situation today, keep an eye out for the real dynamics of the situation. Ask yourself – who is buying and who is selling? It is ideal to be the buyer but circumstances often force us to be sellers. If we’re to be sellers, let’s acknowledge our role but be self aware enough to sell with panache and enthusiasm, and not appear desperate. Appearing desperate is a put off.

Besides, in a negotiation, you are at your best position when you are willing to walk away..

Ditching the final exam lens

We spend the first quarter of our life in schools preparing for final exams. Final exams are, as their name suggests, big and important. The more important ones determine which high schools and colleges we attend and have a sizeable impact on our life.

Real life is very different though. There are no final exams – only a never ending series of class tests. Some class tests are more important than others but, in the final analysis, it remains just a class test. There are a couple of nice advantages to this.

First, class tests allow for endless iteration. Yes, doing badly on a more important test can close a door but our progress in the long run will be determined by our persistence, tenacity, and the rate at which we learn from our successes and failures.

Second, our best selves don’t matter nearly as much as our average selves or who we are most of the time. In the long run, we make a difference when we raise our average performance level and ensure our lows aren’t damaging. Balance in our mental state isn’t overrated.

Finally, a never ending series of class tests means we can never cite lack of motivation or inspiration as an excuse. Every time we feel a lack of internal energy, we must stop and repeat – “I am the master of my fate. I am the captain of my soul.”

Enjoy today’s tests and trial. It’s the infinite game – let’s have some fun!

Rockstar Analyst Series – Powerful IFS (SUMIFS, COUNTIFS)

The updated spreadsheet for today’s post is here. Please head over to the “IFS” tab to understand the power and potential application of SUMIFS and COUNTIFS.

Understanding SUMIF and COUNTIF

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The first table is a simple summary of the distributor’s net sales and number of transactions to achieve the net sales. This can be achieved by simply using a SUMIF or COUNTIF function. But, for the sake of simplicity, I am going to stick with SUMIFS and COUNTIFS since they work for all scenarios. So, the formula structure for SUMIFS is

SUMIFS(Data you want to sum i.e. Net Sales, Data you want to filter i.e. Distributors list, Criteria for filter i.e. Distributor name)

Similar application for for COUNTIFS, AVERAGEIFS. I haven’t shown AVERAGEIFS here as I haven’t used it all that much in practice but it’s just an extension of SUMIFS and COUNTIFS.

Power of SUMIFS

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The real power of the SUMIFS function is illustrated in the above table. You have now taken the data dump in the “Base” sheet and converted it into a heat map to understand which distributor-valve combinations generate the most revenue within 3 minutes.

There are many ways of cutting this data and it really depends on what you are trying to do. No matter how you plan to summarize it, SUMIFS/COUNTIFS/AVERAGEIFS can usually help. For example, you could just as easily focus on which distributor-valve combinations aren’t giving you enough sales.

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Next week, we’ll take a look at how to set up absolute and relative references in such analysis before diving into conditional formatting and other ways to use this data.


Series introduction, Part 1 (Set up), Part 2 (Shortcuts)

Do we learn more from success or failure?

A ton of research over the past years has pointed us in the direction of learning from bright spots or successes. So, do we learn from failure? And do we learn more from success or failure?

I believe we learn from both. That shouldn’t be too much of a surprise coming from someone who writes under the banner of a blog called “a learning a day.” That said, I do believe learning from success is more powerful.

Out of every 100 projects we attempt, it is likely we have about 80 failures and 20 successes. So, failures are a huge part of our life and learning from them is essential. That said, their primary function is to teach us that something doesn’t work. However, for every 10 ways that work, there are a 100 ways that don’t and thus, successes are few and far between.

So, we should learn from failure. That’s how we grow up, become wiser, and stay humble. But, we must focus our energy on learning from success. Luckily, we don’t have to restrict ourselves to our successful experiences – learning is an equal opportunity employer. When you see something working, copy it.. and then develop your own style. I have my eye on learning from Ben Franklin’s Junto at the moment..

The tools only help after the threshold

Give a beginner guitarist who normally practices with a $100 beginners guitar a Fender original worth thousands of dollars and you won’t see any difference. The sounds will still be coarse and he’ll still have trouble making basic chords.

Give the same Fender original to a guitarist who has been learning for a year and you’ll begin to sense the difference. The sounds will be sweeter and the music more powerful. Give it to a seasoned pro and you will feel the difference.

There are 3 lessons here –

1. Our tools are only good after we cross the threshold level of competence. We could have the best golf clubs in the world but if we haven’t deliberately practiced golf and raised our skill levels, it doesn’t matter. So before you invest in the next great tool in a bid to raise your performance level, take a moment to ask yourself if you can bring out the best in the tool.

2. In the old world, access to great tools was scarce. Hence, there was a high cost to attempt just about anything. Starting a business required computers which cost millions of dollars. Today, the cost of tools has gone down to 0 in many cases and it’s easier than ever to build something meaningful. So, we need a really high focus on skills because the chances are high that the tools we need are available pretty easy.

3. Finally, skill building will require us to develop a collection of top notch habits. We have an unlimited number of options available – it will take more discipline and willpower than ever before to focus on what we’d like to achieve and to put in consistent effort to build something meaningful.

Bed-rock of habits first. Skills focus next. Tools focus last.

On Tasty Desserts and Never versus Later

This week’s book learning is from Willpower by Roy Baumeister.

Researchers looked at different kinds of self denial. Subjects were shown pictures of a tasty and appetizing dessert.

Group 1 imagined eating it.
Group 2 imagined passing up dessert by deciding not to eat any at all.
Group 2 imagined passing up dessert by denying for now but told themselves they would eat at some later time.

Then, they measured how often they were distracted by yearning for desserts in a later activity as unfinished tasks tend to intrude in our thought process.

It turns out the “Not now” group were less troubled than both groups – even those who had imagined eating it! This is because our mind marks “I’ll do it later” as a “completed” task.

The mind never takes no for an answer and even indulging it fuels a craving for more. The best solution is to just say “later.”

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Sketch by EB

As Mark Twain put it ‘To promise not to do a thing is the surest way in the world to make a body go do that very thing.’ So, every time we face a tough food choice this week, let’s never say never and always say “later!”

A few thoughts on organizing a dream wedding

I got married 2 weeks back in Chennai. We were fortunate that our wedding turned out to be everything we hoped for and I thought I’d share my lessons with a focus on what went well. As the chances are high that you will be involved in organizing a wedding in some capacity – as a groom/bride, parent, sibling family member, or friend, I’m hopeful the lessons will be useful to you.

Context: We had 6 months to plan our wedding as I got down on my knees in January and we decided the date would be in July. Additionally, we had 2 days of pre-wedding celebrations with friends and family before a small wedding day and then a large reception – a mix of Indian and Western traditions. It wasn’t conventional and that meant we went back and forth on the kind of wedding we wanted. Additionally, our parents played a big role in our wedding as per the norm in Indian weddings – this context will be reflected in my thoughts below.

6 months before/ when you start planning
1. Bride/Groom – Sit down to understand: REALLY understand what you want. Ask yourself what you visualize when you think of the day(s) and make sure you have a picture that is aligned. We always described our wedding with 3 words – small, intimate, and celebration. That helped.

2. Bride/Groom + Families. Have an open conversation on the type of wedding you want. We had long discussions upfront to get this sorted and we eventually narrowed down on a plan for the 4 days that we all could live with..

A caveat here – It’s vital to be sensitive to everyone’s needs and requirements. We did our best (as bride and groom) not to bulldoze our parent’s suggestions and sensitivies while being firm. (It helped that our parents were wonderful throughout the process, of course!) After a bit of back and forth, we managed to find very good middle ground.

3. Set up governance. Organizing a wedding is just like managing a project. My recommendation would be to make the bride the CEO – no decision goes through without her approval. In our case, we had our parents take charge of different aspects and this was a HUGE step in making sure planning moved forward.

4. Sort out venues. This is driven by the type of wedding you want – so those discussions need to come first. As soon as these are done, get our pre-invites to all close friends so they can sort our vacation and flights as necessary.

3-5 months before.

4. Work hard on guest lists. This is tough if you are Indian and want a small wedding. I’d wager it’s tough in most cases. There’s no running away from it. We had many many long conversations and we kept going back to our keywords – small, intimate, and celebration.

5. Dig deep into costs. Weddings are expensive affairs and the cost of many small things add up quickly. Luckily, there are tons of levers to cut costs. For example, we were all aligned that we wanted excellent food all through but were more than willing to cut down on other little things like –
– We did e-invites instead of traditional invites and that helped a great deal as stationery costs add up
– We pre-bought all our alcohol in the 3 months before the wedding as charges across venues are really steep! So, we had all friends coming in from abroad bring duty free alcohol..
– We kept guest lists small :)
– As we got closer to the event, we went through every cost item line by line and removed tons of unnecessary items
– We worked with one logistics provider. This was more expensive but helped a lot with convenience and saved a lot of time as we had one point of contact for the most part.

6. Involve everyone who wants to be involved. We were fortunate to have friends and family who wanted to be involved. My recommendation would be to get everyone involved as much as possible.. their support becomes invaluable as you get closer to the day.

1-3 months before

7. Get inviting and help people coming from afar with logistics. This is an arduous process but is a big step in building the momentum. Send our your invites and then help all friends taking the trip across continents with logistics – booking flight tickets, etc.

8. Use Whatsapp. We experimented a fair bit with various pieces of technology and came to the conclusion that Whatsapp is the best event organization app. We had a huge centralized Whatsapp group for our friends and numerous sub groups for various pieces of the puzzle. This was invaluable and also helped build excitement and momentum.

1-4 weeks before

9. Speak to close family every day. This is crunch time and the stress levels go up. Be of help by keeping in close touch with close family (assuming close family is helping out :))

10. Very important – Transition “control center” to framily. The worst mistake you can make is to be the control centre  close to the wedding. My recommendation would be that the bride, groom, and both sets of parents absolve themselves of all organization responsibility one week before the wedding. I’m hopeful you will have close family members or friends who will take over. If you don’t, I’d suggest you go make some close friends NOW.

In all seriousness, the week leading up to a wedding in the family is very chaotic and you want to make sure you aren’t the stressed out bottleneck. We were incredibly fortunate to have some super capable friends and family take over the entire organizational piece – i.e. one big rocks manager (food, venues, etc.), one events manager (i.e. all the small details), and one person in-charge of the various small pieces of the puzzle . We literally just focused on what only we could do – show up, get married, smile, and have fun.

This learning didn’t come easy as I pushed the ‘ask for help’ part until I was completely overwhelmed. Please avoid my stupidity.

11. Do a complete event flow call – from first minute to last minute – with new framily event managers. We did a marathon 5 hour Skype call with everyone involved and walked through every single detail a week before the big day. That was the day we transitioned responsibility over to friends.

12. Define clear roles for all friends. As mentioned above, we also defined roles for the members of framily who were going to help with the wedding and had people in-charge of photo, video, technology, music, etc. This was really helpful amidst the chaos.

13. For the ladies – if you have more than 1 function, pack separate bags with everything required beforehand. Pro tip from the wife.

During D-days

14. Ask for lots of help. It’s amazing how many of your framily will want to help. You’ll be making them happy by asking them for help. So, do lots of that!

15. Always smile and be in a good mood. If the bride and groom are tensed, everyone is tensed. Let it be a real celebration! And if you are the bride/groom, it’s your day.. take advice with a pinch of salt and do what you need to do to have fun.

After

16. Follow up with thank you’s. To individuals, groups – as necessary. 

Other tips at random

Take some time to get to know each others’ families in advance. It’s nice to surprise relatives by already knowing their names! We didn’t have that issue with friends since most of our friends were common having been together 6 years.

Calling in-laws ‘Mom’ and ‘Dad’. This is not for everyone but we decided a few months before the wedding that we’d replace ‘Uncle’ and ‘Aunty’ with Dad and Mom i.e. A uncle became A Dad. It was a huge mental shift for us but helped..

Things will go wrong. That’s just normal. Shrug and move on. Make the most of the limited time you have with your favorite people.

Work in some surprises. We had a bunch of surprises planned that different groups were privy to and this added the sense of fun and anticipation.

Make sure the wedding reflects YOU. We didn’t have a traditional bachelor/bachelorette party as that’s not our style. Instead, we got our closer friends and family together at a beach house 2 days before our wedding and had a blast. We also had lots of music, some dance, lots of conversation and many laughs – i.e. our style.

Never forget that it is a celebration. Never ever ever forget this. Organizing a wedding can get very stressful.. remember to remind yourself from time to time that it is just a celebration and the most important thing is to have fun.

Our wedding was very very special. Save for a couple of super special people who couldn’t make it thanks to travel issues, we had almost all of the most important people in our lives together for 2 incredible days. I would happily do it all over again to relive all those great memories. Now that I’ve played the groom’s role in a wedding, I’m looking forward to helping out in the many that will follow..

I’m sure I’ve missed out a few tips but I’ve hopefully got most of what worked for us covered. Look forward to your additions in the comments.. and of course, I hope it helps!