Thinking in Models

In The Personal MBA Josh Kaufman writes that:

Correcting your mental models can help you think about what you’re doing more clearly, which will help you make better decisions.

To make sense of the world we create models of it. Models are abstractions that help us think. No model is perfect. The only perfect model is the universe itself. So we don’t have to worry about our models being perfect, all models are wrong, but some models are more useful than others. That is the power of models – they can always be improved. And when we make them better, our thinking improves. Models can do a lot of work for us.

Kaufman continues quoting Charles T Munger:

I think it is undeniably true that the human brain works in models. The trick is to have your brain work better than the other person’s brain because it understands the most fundamental models-the ones that do the most work.

What you need is a latticework of mental models in your head. And, with that system, things gradually fit together in a way that enhances cognition.

I remember Clayton Christensen saying that when someone asks him a question he does not answer the question directly, instead, he looks for a theory or model that can be applied to the question. He then sees how the question holds up. (I recall this from memory, so if I have this wrong, please let me know.)

I’m experimenting with this approach. Often when presented with a question, looking for an answer is not the best approach. Applying a model to the question may produce a better question. When I can’t find a suitable model I’ll try to sketch one out on paper. I’ll evolve the model by showing it to people, iterating until it starts to simplify and communicate the situation better. In this way shifting the burden of work onto the model. My work then becomes to continually grow the latticework of models in my head and to practise them whenever I can.

The Inside View and The Outside View

Projects are filled with thinking traps. Daniel Kahneman‘s inside and outside view, from Thinking Fast and Slow is a useful model when thinking about projects.

At the start of a project we’re optimistic about our chances of success. We overestimate how much we can do, and we underestimate the time and effort it will take to do it. Kahneman calls this the planning fallacy. Without the planning fallacy we probably would never attempt anything. But it has a downside: Focusing on the end goal blinds us to a lot of useful information when we become trapped in the inside view.

The traps of the inside view:

  • Competition neglect. We fail to take note of what competitors are doing.
  • Above average effect. We ignore the skills of others that are doing the same things, thinking that we are better than everyone else.
  • Sunk cost fallacy. Having invested in a project it is hard to let go, even when chances of success are evidently slim, leading to irrational perserverance where we give up rationality rather than the enterprise.

We become trapped in the inside view because we tend to ignore statistical information that is:

incompatible with one’s personal impressions of a case.

To remedy the effects of the inside view we can increase our chances of success by:

consulting the statistics of similar cases.

Taking the outside view and looking at how others have faired when attempting similar projects can help us make better decisions ourselves.

The Road to Johannesburg

I am on the eve of working in Johannesburg. I’m joining McKinsey&Company, or McKinsey Digital Labs to be precise.

Once upon a time I was a designer. During the last five years I became a consultant. Not by design, it just sort of happened. The transition was easy, so it feels right. But I didn’t plan it. Which is why this Joseph Cambell quote gave me a jolt:

We must be willing to let go of the life we have planned, so as to have the life that is waiting for us.

Leading up to McKinsey I worked at Capgemini and Deloitte Digital. When I started out I had a vision of being a freelance designer working on my own. How I ended up working at these iconic companies is still a mystery to me. But there is a significance here that I need to understand and respect. Because now I’m joining the most iconic Firm of them all.

The trick is to stay in charge of your own destiny, and based on my experience at big consulting firms, if you wait for things to happen then you’re not going to get far, you must take action to make things happen. For an inward looking designer like me this has been the hardest transition to make.

If we cut loose old baggage new opportunities await us–I have no proof that this is not so. I’m excited when I think about what could happen next. But there are new things I must learn. Most importantly I must relearn what design is all about so that I can become a better designer. And I need to understand and internalise what consulting means for a designer in 2016: A good designer is someone who can improve a situation, and a good consultant is someone who thinks more about a client’s problem than the client themselves, the result of which helps the client to make improvements.

A long time ago when I was a working holiday maker in London I worked as a cycle courier for a time. It is the most extreme work I’ve ever done. But what I learnt was that no matter how bad a day was, when the next day started at 8 am there was a clean slate before me. Yesterday was forgotten. It’s a new day and anything could happen. And it usually did.

A Systems View of Innovation

How might we describe innovation as a system as apposed to a process? Thinking in systems about innovation is not new, innovation hubs and ideas around biomimicry take a systems view.

In a systems view of innovation events happen simultaneously, and for the most part uncoordinated. A systems view of innovation ups the odds for chance and luck to play its part in the emergence of new ideas and solutions. Thinkers like Nassim Taleb and Daniel Kahneman ascribe more agency to luck and randomness than to individual decision making and skill in stories of success. A healthy innovation system needs to spark randomness, building on a solid skills bedrock, to increase the likelihood of lucky events.

A first stab at an innovation systems model could look something like this. It all hinges around a sense of opportunity that attracts people. Next, buildings provide physical space for people to interact. But more importantly, buildings and location give context that inspire people to take action. People bring skills and new opportunities. All these components need the right proximity to each other – if the friction becomes too great the system will fail. If the proximity is optimal it becomes a virtuous cycle.

We need new skeletons

New systems can be conceptualised as new skeletons, with the aim of attracting new cells to eventually grow new muscles. Our current skeletons are outmoded remnants from the industrial age. Our aim should not be to change them, we need to create new ones while slowly disinvesting in the old ones. The purpose of innovation hubs is to create new skeletons. 1

A systems view of innovation.

In this model no single entity can own innovation, players choose where to participate and what to contribute without certainty of outcome or payback.

Organisations eager to join the innovation game need to make radical culture and mental model shifts, because they’ll need to become more open and outward focused. For big companies this means more risk. But without risk there can be no chance or luck, and no innovation.

  1. The skeleton analogy is from a workshop I attended by Elizabeth Dostal

Thinking about emotions and relationships when working in big teams

The working title for this piece was Working with difficult stakeholders. But I changed my mind, for three reasons: Firstly, I once referred to a stakeholder as ‘difficult’, but a colleague on the same project had a different experience. Secondly, when asked in a job interview how I’d deal with difficult stakeholders I realised that up to that point I hadn’t really given it much thought. And thirdly, ‘difficult stakeholders’ has a faceless ring to it and it sets the scene for othering.

On the back of a recent project I made a list to help me next time I work with a big group that hold divergent and often apposing views:

  1. Draw a map of all the people on the project.
  2. Make the interrelationships between them visible.
  3. Identify everyone that will be impacted positively.
  4. Identify everyone who will be impacted negatively.
  5. Identify what people need form the project, and understand why.
  6. Ask yourself: What am I not seeing?
  7. Start with your own emotions. Look at your feelings and take ownership of them.
  8. Acknowledge that change is emotional for people about to gain, or loose something.
  9. Back up observations and recommendations with evidence.
  10. Talk is work – be on the lookout for opportunities to start conversations.

Another way of looking at it is that the interrelationships between people on a project is the project. A project will fail to reach its potential if working effectively with others is not seen as a key deliverable.