Bias for action. Gets things done. Go-getter. Traits companies big and small look for. And for good reason, you're being hired to do things! However, action is a secondary step that often overshadows the primary step, direction. Clear direction is the foundation that enables our actions to takeoff. Without it, we're stuck in the mud. Striving for clarity is an underrated skill. Having the courage to ask ( seemingly ) obvious questions, and to check in, making sure we're all on the same page. "O bvious " questions are a low risk, high reward way to add value. At worst, you'll add confidence to our actions. At best, you discover a misalignment that saves us from a dead-end. The more people, the more clear we need to be. The bigger the initiative, the bigger the risk of reaching the finish line, only to realize expectations were off. Success is always uncertain. But we can be certain about what we want and what everyone's job is. Things that can be clea
In 1951, psychologist Solomon Asch conducted a series of studies to test the impact social pressure has on our decision making.
The study involved presenting groups with two cards. Card 1 had a single line, Card 2 had three.
The group was asked to choose the line on Card 2 that matched the line on Card 1.
Simple enough, but there has to be a twist, right? Yup! Would be a pretty boring study otherwise. Each group was filled with actors, with only one true test subject.
The experiment would begin with a few rounds where everyone would answer correctly. The answer was always obvious. As the test progressed, the actors would start choosing an incorrect option. For example, with lines above, the actors would choose A when the answer was clearly C.
Asch found that social pressure would cause test subjects to conform and select an answer that was obviously wrong. The likelihood to conform being greater the larger the number of actors.
There's been a number of studies demonstrating our tendency to "herd".
One study had actors stand on a street corner looking up at the sky, at literally nothing. When it was only one actor, a few passerby pedestrians would join in on the sky-gazing. Similar to the line experiment, when the number of actors grew, so did the number of conformers.
Our bias to trust the masses can negatively impact our financial decisions. There's a lot of noise out there. People telling us that you'll get rich by buying certain stocks, or that real estate is best investment. It's easy to default to the wisdom of the crowd, it's especially enticing when others have done well.
Investors blindly following the crowd is what creates bubbles. It happened in 2000, when investors dove into internet stocks, it happened in 2017 with Bitcoin. It never ends well.
The input from others should only be one data point. Everyone has a unique situation, different goals, different tolerances for risk. What everyone else is doing might not be right for you. Definitely learn from others but don't forget, you're an individual and your milage might vary.
There's been a number of studies demonstrating our tendency to "herd".
One study had actors stand on a street corner looking up at the sky, at literally nothing. When it was only one actor, a few passerby pedestrians would join in on the sky-gazing. Similar to the line experiment, when the number of actors grew, so did the number of conformers.
Our bias to trust the masses can negatively impact our financial decisions. There's a lot of noise out there. People telling us that you'll get rich by buying certain stocks, or that real estate is best investment. It's easy to default to the wisdom of the crowd, it's especially enticing when others have done well.
Investors blindly following the crowd is what creates bubbles. It happened in 2000, when investors dove into internet stocks, it happened in 2017 with Bitcoin. It never ends well.
The input from others should only be one data point. Everyone has a unique situation, different goals, different tolerances for risk. What everyone else is doing might not be right for you. Definitely learn from others but don't forget, you're an individual and your milage might vary.
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