SPEED-READ #3: Thinking, Fast and Slow

Today we look at "Thinking, Fast and Slow" by Daniel Kahneman

SPEED-READ #3: Thinking, Fast and Slow

Every month we like to share with you one ‘speedread’… we all feel time poor these days, for some that means not reading at all but for others it means not wasting time on a book that’s not right for you. Have a scan below and see what you can pick up – it may tip you over to Amazon and get this book in the post!

Thinking, Fast and Slow is a best-selling book published in 2011 by Nobel Memorial Prize in Economic Sciences laureate Daniel Kahneman. The author focuses on a separation between two modes of thought:

"System 1" is fast, instinctive and emotional;

"System 2" is slower, more deliberative, and more logical.

He then continues to explain their impacts on daily decisions and why we value human judgement so highly. It’s very interesting to look at why we think the way we do, why we make decisions the way we do and why humans struggle in our own heads. Sounds familiar? Read on...

The Systems: 1 & 2

Basically we always form thoughts in two different ways: Fast and Slow.

The author conducts a series of experiments to show how differently the two systems perform given the same input. Thanks to these two systems and his experiments, he explains how decisions are made, why we all make mistakes and how we can improve ourselves.

What does this really mean for you today?

-        Our mind is lazy and will lead us to errors and affect our intelligence

Let’s take the bat and ball problem: If a baseball and a bat cost $1.10 together, and the bat costs $1.00 more than the ball, how much does the ball cost?

Most of us probably just answered $0.10, right?

Well it’s the wrong answer. The correct answer is $0.05. What happened was that your impulsive System 1 took control and automatically answered by relying on intuition. But it answered too fast. Usually, when faced with a situation it can’t comprehend, System 1 calls on System 2 to work out the problem, but in this specific problem, System 1 is tricked. It perceives the problem as simpler than it is, and incorrectly assumes it can handle it on its own. This shows our innate mental laziness. When we use our brain, we tend to use the minimum amount of energy possible for each task. This is known as the law of least effort. Because checking the answer with System 2 would use more energy, our mind won’t do it when it thinks it can just get by with System 1 .

- The mind makes quick choices, even when it lacks enough information to make a rational decision

This is particularly interesting to understand customer behavior perception as a Brand Ambassador.

Let’s imagine that we’re all going to a party. There you meet Brian, who we find very easy to talk to. Later, someone asks if you know anybody who might want to contribute to their charity. You think of Brian, even though the only thing you know about him is that he is easy to talk to. In other words, you liked one aspect of Brian’s character, and so you assumed you would like everything else about him. We often approve or disapprove of a person even when we know little about them.

Our brains often tend to oversimplify situations for which it doesn’t have enough information. This is known as the Halo effect: positive feelings about Brian’s approachability cause us to place a halo on Brian, even though we know very little about him.

Have you used the ‘Halo effect’ to positively pre- judge a customer? Or flip it on its head, have you prejudged someone negatively on little basis?

If you want to learn more on how your brain works, try this quick test based on the book: https://www.vanityfair.com/news/2011/12/kahneman-quiz-201112 and let us know what you think #speedreadba #alwayslearning.