A good collection of mental models extracted from various disciplines, which if applied properly, can help broaden one’s perspective. Very similar to Charlie Munger’s emphasis on breadth of knowledge and when magic happens when a confluence of factors across a broad spectrum manifest themselves in a lollapalooza effect.
A few mental models that stood out:
1. Argue from first principles - go back to basics and figure out what are we really trying to solve
2. Be aware that your views are being framed by people around you e.g. first impressions, media
3. To avoid personal biases or framed perspective, walk a mile in their shoes, try to see from their point of view as impartially as possible using a third person’s view. How are we being perceived by the observer?
4. Learned selflessness - people stop trying when they believe their efforts just don’t cut it anymore or it’s just not worth it anymore. Results in active disengagement
5. Thinking gray - the world is not black and white. Truly effective leaders are able to see shades of gray inherent in a situation and make wise decisions on how to proceed
6. Tragedy of the commons / free riders - stems back to human nature to be selfish and greedy. Especially if the specific action does not come with any negative consequences (financial, social, civic etc). Rules and regulations need to be set to draw the line & they need to be enforced or else another negative norm is set which will make it harder to unwind. Good example on the preschool imposition of preschool late pick up fines that made it okay to ‘pay’ for the teachers’ extra time leading to more late pick ups. When the fine was removed, the numbers didn’t recover because a new norm has been set
7. Asymmetric information e.g. Real Estate agent vs buyer
8. Goodhart’s law - when a measure becomes a target, it ceases to be a good measure
9. Technical debt - in programming, most coders tend to prioritise short term code fixes over long term, well designed ones. Over time the debts accumulate to make the code clunky and someone in the future will have to fix the mess. Short termism
10. Path dependence. Sometimes the outcome was decided by a path taken earlier. Trick is to recognize points of no return
11. Paradox of choice - over abundance of choice lead to fear of making suboptimal choices & unhappiness. Improve design by limiting choice where possible
12. The top idea in your mind - most people have one or two and their thoughts will drift toward when they’re allowed to. Normally these are things that excite them because they are impactful. However, not many organisations allow time for people to have their minds drift freely into these top ideas and put them into actions. These are the ideas that can move the needle and generate passion amongst people e.g. Google
13. Deep work - allow people to spend time on tackling the really tough things undisturbed. Most people will want to solve problems they know how to solve. These are the B+ problems at best. In the long run, the company will be a B+ company. The A+ problems are hard by definition and require deep unobstructed work and to be a truly top organisation, deep work on top of best people are needed to solve the really tough problems
14. What is important is seldom urgent and what is urgent is seldom important - Dwight Eisenhower
15. Parkinson’s law - work expands so as to fill the time available for its completion
15. Reframe the problem to help look at it from different angles. The shortcuts can normally be found e.g. hackers reframe the problem from ‘How can we best guess your password’ to ‘how can we best get your password’
16. It’s not the most intellectual or strongest of species that survives but the one that is best to adapt to the changing environment
17. Don’t fight with nature - inertia requires significant amount of activation energy. Make sure you have that first
18. Shirky principle - institutions will try to preserve the problem which they are the solution. Reminds me of Ronald Reagan’s autobiography where he shared his encounter with unemployment offices discouraging people to take up jobs but to receive their handouts instead; bureaucracy’s number one objective is to preserve the bureaucracy
19. Flywheel - a rotating disk that is used to store energy to create momentum
20. Homeostasis - organism regulates itself around a certain condition similar to organisations regulating itself around a certain metrics or values
21. Technology adoption cycle - innovators (2.5%), early adopters (13.5%), early majority (34%), late majority (34%), laggards (16%)
22. Metcalfe’s law - non linear growth in network value when nodes are connected to one another
23. Accept that we are surrounded by chaotic system and adaptability is the key success factor. Don’t be lulled into a sense of stability and put effort into creating a perfect system in the stable system that does not exist in the first places. It’s okay to plan ahead, just be aware that all it takes is a flap of the butterfly’s wings to undo the plans
24. Luck surface area - lucky people are not lucky. They tend to spread themselves that covers a wide surface area such that when an opportunity arises, they are there
25. For any issues, you can find people on both sides with ‘numbers’ to back up their position
26. Survivorship bias - surveys are filled by people who care enough to response. E.g. surviving WW2 planes were analysed and reinforced based on where they were hit the most but realised that these were the planes that survived and the places most hit are the ones that need the least reinforcements because Pilots can survive even when those areas are hit hard
27. Bayesian - starting from a prior (intuition) and converge toward the truth. Faster but prone to local optimum. Frequentist - starting from scratch based on cold hard numbers. More accurate only if there big enough and diversified sample size
28. Hysteresis - system’s current state can depend on its history e.g. T cells that help power our immune system, upon activation, would require lower threshold to reactivate
29. Knowns and unknowns (2x2 matrix). Objective is to move as many things it known knowns as possible. Known unknowns (get help from others who know), unknown knowns (get some experience), unknown unknowns (thought experiments, scenario analysis to minimise blind spots)
30. Beware of groupthink. Typically associated to person with the highest demonstration of confidence able to get their bandwagons going with followers jumping on quickly creating a convergent thinking environment
31. Social norms is more powerful than market norms. E.g. one is less likely to want to be paid by neighbours to babysit their kid vs doing them a favour
32. Distributive justice vs procedural justice - equity vs equality
33. Strawman - opponent misrepresent the issue by associating your argument to something else that’s easy to attack and incite emotions
34. Loss leader strategy - one product is priced low to increase the demand for complementary products
35. Sometimes the only winning move is not to play. Not all conflicts need to be tackled head on or resolved. Need to be selective, else it is going to severely drain your resources
36. Generals always fight the last war. Successful people / leaders are where they are because of their past victories and modus operandi which helped them leapfrog the then status quo. Until when they become the status quo
37. Organisations hardly ever have perfect resources nor can they always afford to wait until they have better ones before moving forward. Great people are unlikely to be concentrated in a single organisation. Successful organisations are successful because right people are led in the right way
38. 10x teams or 10x employees. Right confluence of factors to lead to superior performance. However, the output may not be replicated when they switch roles or projects
39. Creating a 10x team requires a leader to understand the difference and nuances. It goes way beyond just putting a body on the job but having the right skills, attitude, personalities within the team. More often than not large organisations have the tendency to trust their processes too much that people feel like they’re just a cog in the machine and hence feel disengaged, instead of creating a 10x team, a 0.1x team was created
40. Three types of people required in different phases of organisation / project life cycles - commando (speed, no rules, create a beachhead), army (large numbers to build systems and infrastructures to extend advantage), police (enforce rules, build stability for growth). Having the wrong group at the wrong time can hurt you a lot more than helps
41. The fox knows many things but the hedgehog knows one big thing. Successful businesses were started by hedgehogs having a singular focus to be good at one core idea. However for the successful company to survive in the long term, they need foxes. Hedgehogs tend to have a focused world view whereas foxes tend to be more cautious and pragmatic
42. When giving feedbacks with radical candour - Being vague and abstract is much easier because it avoids the hard work of identifying specific examples and the psychological stress of debating the nuances around those specifics. If you care enough for the person, gotta put in the hard work
43. Dunning-Kruger effect - early part of the learning curve is exciting. But it is quickly followed by the reality on how much more do you have to learn before you become the expert and finally the satisfying feeling when the expertise is obtained. Key is to not give up after the initial euphoria. Applies to many things in life, people tend to be happier in their youth and old age
44. Self serving bias - you’re more likely to say that your mistakes could not have been predicted and more likely to apply hindsight bias to be critical of others
45. Being explicit about the cultural norms in a company is one of the most high leverage activities you can do as a leader
46. Manager’s schedule vs. maker’s schedule
47. The only way to generate outstanding returns is to be right and contrarian. Just being right is not enough but don’t be a contrarian for the sake of being a contrarian - that’s more dangerous
48. Vision without action is a daydream. Action without vision is a nightmare - Japanese proverb
49. OODA loop - observe, orient, decide, act. Air Force Pilots are trained to go through OODA loops quickly during dogfights where there’s no time for analysis
50. Pivoting is difficult because it cuts against organisational inertia, involves openly admitting failures and requires finding a better solution all at the same time
51. Only the paranoid survive