Overconfidence | Information Overload | Prioritization
Every week we curate 3 ultra-focused ideas to reduce life complexity. On Saturday we share them with you via email.
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The overconfidence bias
Reality has a surprising amount of detail John Salvatier
Consider a humble can opener. Try to explain exactly how it works. Try to draw all its parts. You'll probably end up with an approximation that barely resembles the original.
Psychologists call this the "overconfidence bias": most people feel they understand the world with far greater depth than they really do.
Ignoring the workings of a can opener won't have severe consequences on your life (I imagine). But the overconfidence bias applied to critical decisions leads to costly mistakes.
As individuals and as a society we deal every day with complex systems: the environment, relationships, our body... We need approximations to be able to decide. Considering every single detail, every single interaction within the systems, would paralyze us.
But we usually end up oversimplifying. So our decisions have unintended and often bad consequences.
Overconfidence bias can't be eliminated. But we can manage it in three ways:
embracing meta-rationality, that is knowing when to defer to experts or admitting that no one can know the answer,
acquiring the "fingertip feeling", which means studying enough to develop a deep intuition about the subject,
using a margin of safety.
The margin of safety takes different forms depending on the decision. When planning for a complex project, for example, you should double the time you think it will take. Then ask yourself if it is still worth it. This takes into account our habit to underestimate how long tasks can take.
Social media, the corporate environment and our own instincts are feeding our overconfindence bias daily. Overcoming it takes long and hard work, but will lead to better decisions and far less errors.
Information vs Time
...research published in the Journal of Experimental Psychology shows that the less time a person has to spend comprehending a story, the less likely they are to be skeptical of a false story.
This is scary.
You know how tiny is attention span today. The news cycle struggles to keep important topics in focus for more than a few days. Fake news is everywhere.
It's a recipe for disaster.
Information without meaning can't help your decisions. Or it can take you to the worst mistakes.
The solution is simple but not easy: you need more time to find the right sources, gather information, make sense of what you learned.
So, first of all, find the most thoughtful and well-documented sources. Then, change your news consumption habits. Don't chase last-minute updates when they are not necessary for your survival.
Consider and compare opposing viewpoints. Take time to reflect. Question what you hear and look for additional sources when something isn't convincing.
It will take effort and courage. But it will guarantee less stress and better decisions.
What would you hate not doing the most?
You can do anything but you can't do anything. It's especially true in our time.
Your basic necessities are probably satisfied every day. You have thousands of opportunities at your fingertips. This is why deciding where to invest your precious resources (time, money, and energy) is so damn hard.
Should you follow your passions? Should you follow the money? Should you avoid upsetting your relatives and friends?
Derek Sivers is a master simplifier. His time is dedicated to what excites him. Doing so he was able to turn from professional musician to digital entrepreneur and sell his first business, CDBaby, for millions of dollars.
His decision-making approach frequently goes against the norm.
Often, when we have to choose among projects or about major changes in life, we ask ourselves "how will I get the most benefits?" or "how do I limit the downside?".
He suggests a reverse approach. Ask yourself instead: "What would I hate not doing the most?”
It's a brilliant solution. In your day-to-day, you surely found some activities that gave you joy, put you in the flow state, gave you energy despite the required effort. If you had to give them up you'll feel depressed, useless.
What are these activities? Maybe your past choices took you away from them?
Choose the option that will maximize the time and energy you devote to those activities. You will generate a virtuous cycle that will give you more energy, bring you satisfaction, and even make you more money.
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Until next week,
Samuele & Alberto
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