The Jordan Harbinger Show - 906: Shane Parrish | Decoding Decisions Through Clear Thinking

Episode Date: October 5, 2023

Learn how to optimize decision-making, gain competitive advantage, and live more intentionally through clear thinking with Farnam Street's Shane Parrish. What We Discuss with Shane Parrish: Clear thinking equips you to identify transformative moments and adjust your response in the critical space between stimulus and reaction. Despite seeing ourselves as life's main characters, many of us operate on autopilot, guided by ingrained behavioral defaults shaped by biology, evolution, and culture. In our lowest moments, we react without thought, often missing the chance to engage in reasoning. Conversely, at our best, we identify these moments and employ our full capacity for reasoning. Your options are defined by your position in ordinary moments. A good position offers abundant and improved choices, while a bad one confines and diminishes options over time. Learn how you can optimize decision-making, gain competitive advantage, and live a more intentional life through clear thinking. And much more... Full show notes and resources can be found here: jordanharbinger.com/906 This Episode Is Brought To You By Our Fine Sponsors: jordanharbinger.com/deals Sign up for Six-Minute Networking — our free networking and relationship development mini course — at jordanharbinger.com/course! Like this show? Please leave us a review here — even one sentence helps! Consider including your Twitter handle so we can thank you personally!See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Coming up next on the Jordan Harbinger Show. So we're animals, and what do we share in common with all animals? Well, we're instinctual, right? So animals have a biological instinct to be territorial, to be self-preserving, to be hierarchical. The difference between humans and other animals is we can put in a pause between a stimulus and a response. Welcome to the show. I'm Jordan Harbinger. On the Jordan Harbinger Show, we decode the stories, secrets, and skills of the world's most fascinating people, and turn their wisdom into practical advice that you can use to impact your own life.

Our mission is to help you become a better-informed, more critical thinker through long-form conversations with a variety of amazing folks, from spies to CEOs, athletes, authors, thinkers, performers, even the occasional former jihadi, four-star general, Hollywood filmmaker, or Russian spy. And if you're new to the show or you're looking for a handy way to tell your friends about the show, I suggest our episode starter packs. These are a great place to begin. These are where you can find top episodes on Persuasion,

negotiations, psychology, geopolitics, disinformation, cyber warfare, crime and cults, and more. That'll help new listeners get a taste of everything we do here on the show. Just visit jordanharbinger.com slash start or search for us in your Spotify app to get started. Today, my friend Shane Parrish, former intelligence agent in Canada. Yes, they actually have their own up there, and I wonder how much domestic spying it does. I don't know. I'm going to ask them, but I don't expect a real answer. Today we're talking about clearer thinking. It's all about being in the proper position.

If you're in the right position, you have more options, you have better options. If you're in a bad position, your options are limited and get worse as time goes on. And this is a conversation about being in the right position, honing our thinking, creating decision-making frameworks, and getting rid of things that are in our way that no longer serve us. Emotions, ego, inertia, social pressure, and more. Shane's been writing and talking about this stuff for years. This is a great conversation if you're interested in clearer thinking and better decision-making. Here we go with Shane Parrish.

You started at a Canadian intelligence agency in August 2001, auspicious timing, I guess, right before September 11th. And you say in the book, it's a three-letter agency, but I only know about CIS, which is four letters, so that can't be it. Yeah, so Canada has two intelligence agencies. CIS is probably the more widely known one. The one that I went to work for is CSE, which is the communication security establishment. And to put things in context, like we existed since like the 1940s,

But there was like no sign outside the building. There was no like public line in our budgets. You know, we didn't really exist, but we existed. That all changed like September 12th. You show up at the building and now all of a sudden there's like a sign outside and you're like, what's going on here? Jeez. It's like when a business has bad Yelp reviews and they put a banner over their sign

and it's like, new name, grand reopening. And you're like, yeah, I see what you're doing here. Pretty much. So CIS tends to be more like human. intelligence and CSE tends to be more signals intelligence. Got it. So is like the Canadian NSA? Yeah, I think that would be the closest equivalent. Cool. How much spying did you do on fellow Canadians?

Oh, dude, we can't do that. That's illegal. Oh, well, in that case, it's impossible. Well, welcome to the show, man. We've been friends for a long time. I'm happy to have you here or there, but here also. And I love the book. I love the book. And I'm glad I did because sometimes when you read a friend's book, you then are in the position of being like, yeah, it's not a fit for the show. But like, and then you have to go through that whole thing. I didn't have to do that.

So I appreciate you. You're writing a good book for that specific reason. I'm so glad. I'm a little nervous about this. You know, it feels like taking off all my clothes in front of like a million people. And the only people who've seen me naked so far are like predisposed to kind of like the book, right? They either like me or the publisher or. And, you know, so I'm looking forward to hearing.

from everybody else what they think. But everybody's been like, oh my God, this changed my life. Like page 113. I've never been the same since I read it. Wow. The feedback's been really awesome so far, and it's just a different way of thinking about thinking. I can appreciate that,

and I love different ways of thinking about thinking. You wrote the power of ordinary moments. In most ordinary moments, the situation thinks for us. What does that mean? That's interesting that the situation would think for us. Well, let's back up a little bit here. So if you think about big decisions,

decisions in life, like where to work, who to marry, where to live. Those things are big decisions. We know their decisions, so we tend to think about them. The situation doesn't think for us. We're conscious or sort of rational. We might not get it perfect, but we get it generally correct. Ordinary moments are different than that. They're like going home to your partner or your spouse on a Friday night. They're like showing up to work on a Monday, after Monday, after Monday. And those moments have the power to undo these big decisions. And so if you think about going home to your partner or your spouse and all of a sudden, you know, you're getting into a fight over loading the dishwasher, how you load the dishwasher. This is a common one that people seem to, you know, one partner loads

it very methodically, the other's a little bit more half hazard. You both have a little bit of a bad day. And in that moment, you just start escalating with each other. And if I were to tap you on the shoulder and say, hey, Jordan, you're about to put water or gasoline on the situation, What do you want to do? You'd snap out of it. You'd be like, oh, yeah, I just want to put water on this. Like, this isn't worth it. I don't want to pick this fight.

I don't want to escalate. But we don't do that because we don't know we're making a decision. But that has the power to undo. You can pick the best spouse in the world. But if you don't put the work in and you guys don't connect on a regular basis, you're going to wake up to divorce papers. You can pick the best job or career. And it doesn't matter.

If you don't show up and work your butt off, like none of that really matters. and these ordinary moments we don't think of as decisions. So this situation thinks for us. Another way this situation thinks for us, because that's one way it sort of does. But another way is like you're forced by circumstances to do something you don't want to do because you're not in a good position.

You took out too big of a mortgage and interest rates went up and now all of a sudden, you know, you can't afford your house. So you're forced to sell. And when you're forced to do something by circumstances, you're not thinking. You don't have a lot of options.

And your options go from bad to worse. Yeah, getting out of your skis and business especially is really scary. I've only done that. Well, I've almost done it once, and it was kind of terrifying because you just go, my decisions of scaling or whatever, a marketing spend is working, and then you hit this hiccup that's maybe totally outside your control, like the economy, and you realize that you're kind of, what is it that you find out who's naked when the tide goes out? Isn't that the Buffett quote or whoever?

That's a thing that you would know. Yeah, you only find out who's swimming naked when the tide goes. is it. Right. And this is the thing, right? Like there's a whole bunch of MBAs who've been taught to sort of optimize. Everything's about efficiency. There's no slack in the system. So the slightest hiccup, all of a sudden you've got to close down the plant. It doesn't make a lot of sense, but we rarely think about that in terms of positioning and how we're positioned for the future. And can we accommodate multiple possible futures? So if you optimize on one particular thing, you're really making a conscious bet that the future looks exactly like today. And the minute

it doesn't, you're fragile to that. So you're predicting something, but it's much easier to position yourself for multiple possible futures than actually nail the prediction of the future. And you brought up Buffett. Perfect example. I think as of today, he's got like $160 billion in cash on the balance sheet. So think of the position he's in. The stock market goes up, he wins. Stock market stays the same, he wins. Stock market crashes, he wins. He's in a position that every conceivable, realistic scenario results in him winning. And this is one thing that I discovered by studying sort of like the titans of decision making is that they're always just putting themselves in positions where

every option is good. For a lot of folks, it seems like magic doing that. So some of the strategies we'll talk about today involve putting yourself in that position. In certain situations, we don't stop to think we just give in to our basic impulses. And this is sort of the focus of the beginning of the book. You tell the story of the CEO's yelling at somebody and then you find out that the person he's yelling at is somebody who's reporting a serious problem. And that same CEO would get mad at anybody who challenged his ego or brought him bad news, which is the question of how somebody like that becomes the leader in the first place is, I guess, a different book. But when we give into our impulses, we then have to spend a lot of time correcting these

unforced errors, as you put it. For example, rebuilding trust in a team, rebuilding trust, maybe with people even in our own family and spending energy on that instead of moving towards our goals, it's a waste of time. It's really a waste of time because it's avoidable in the first place. Your thesis here that I took away

from the beginning of the book is that the person who thinks clearly spends more time driving towards their goals instead of fixing these issues and problems that they've created by giving into those impulses, they have a massive advantage. If we're looking at a visual representation, right,

you've got the shortest distance between two points is that, obviously, that straight line. But if you're making detours all the time or doubling back because you've got to correct a mistake, you're losing any race you're in, which is bad if you're in business. And if you're a family, you're at least wasting resources on the way to your destination.

I love the way that you put that, right? Think about driving from your house to, you know, someplace a couple hours from now. Every time you sort of get caught up in these impulses or social defaults or sort of ego or hierarchy or anything like this, then you're just taking a wrong turn. and you have to course correct. And we've all done this.

You can imagine sort of like, oh, you get off one exit too early or one exit too late. We've all missed a turn at some point. And we're instantly like, oh, now I've got to spend like 15 minutes getting back to just where I was. And all of that time

could have brought me closer to my destination. Tell me about these emotional, these dangerous instincts that no longer serve us. You've got these defaults, right? The emotion default, the ego default, the social default, and the inertia default. I'd love to go through these and talk about these. And it's funny because when I was reading this, I was texting you and I was like,

it sounds like the godfather. And then the next chapter, it's like, and this is the Sunny versus Vito and the godfather. So I guess great minds watch the same movies, if not think alike, I suppose. Because I didn't come up with this after watching that, but it certainly reminded me of Vito Corleone. And I love this because the reason he was the boss was because he had self-mastery over these four defaults, right? So let's back up a little bit. So we're animals and what do we share in common with all animals? Well, we're instinctual, right?

So animals have a biological instinct to be territorial, to be self-preserving, to be hierarchical. And we share these instincts with everybody else. The difference between humans and other animals is we can put in a pause between a stimulus and a response. Animals can't do that. They're not thinking sort of beings like we are. And so I categorize this broadly speaking. And I'm thinking about what situations cause us not to think and just to react.

And those situations put us in a worse position because it's like that detour we were talking about. And I came up with the four defaults. So we're emotional. Alcoholics Anonymous talks about halt, which is hungry, angry, lonely, tired. We don't make good decisions when any of that's true. For humans, we're all like that. When we're angry, we don't make good decisions. When we're lonely, we don't make good decisions.

When we're sad, we don't make good decisions. And so when emotion takes control of us, we're not making good decisions. decisions. And then there's ego. We're all egotistical. You can say you have no ego, but everybody has an ego. And ego is what propels us forward. Oh, yeah. I mean, the show is called the Jordan Harbinger show. People are always like, you talk too much. I'm like, man, it's on the label. This is what you get. You're signing up for it, right? Yeah, you signed up for this. I think Ryan Holiday wrote the book, Ego is your enemy, but ego is also your friend. But like, you have to recognize, like, when it's serving you, when it's not, because ego can blind you, right? When you think your

solution is correct. And I talk about this in the book, I call it the wrong side of right, when you think you're right, you immediately put these blinders on, and you stop receiving information that's counter to that, and you try to prove yourself correct. There is no motor in the world more powerful than when somebody is trying to prove themselves correct. Like, they just go. The social, right? You know, we follow best practices. We do these things. But what we don't recognize is that when we do the same things that everybody else does, we're going to get the same results that everybody else does. So if you want different results, by definition, you have to do something different. And yet we gravitate towards things like best practices, which by definition are

basically table stakes. Everybody's doing best practices. So if you want better performance than that, that's a shortcut to get reasonably competent at something quickly. But you have to know when to deviate away from them. And you have to know when they're just pulling you forward and you've stopped getting better and you've stopped innovating. And inertia, our habits sort of like carry us through. Right. We start doing something and it serves us well. And then all of a sudden it doesn't, but we keep doing it just because we've always done it that way. I'm going to have you dive into each one of these a little bit more because each instinct on its own, the inertia default, the social default, the ego default, the emotion default. Each one is powerful. But when they're combined, it's like Voltron, right?

It's just you have now a superhuman or captain planet, I guess, depending on your generation and cartoon style. You have a captain planet of bad decisions. or at least bad thinking that can lead to bad decisions. And it's unstoppable at that point, right? You just can't do much about it when all of these are running unchecked as a background process in your brain. Starting with emotion,

when you're captured by the emotions of the moment, all the reasoning, all the tools in the world don't really help you. How can we tell if we are in the emotion default? Do I have to be angry or hungry? Because when I'm fuming and I'm angry, even if I know that's what's happening, It's still hard for me to be like, well, everyone, I'm actually kind of hangary right now, so I don't want to continue talking about this because I'm going to make a bad decision.

That's really hard and really rare, even though I've been hangary more days than not. It still gets me. It still gets the best of me a lot of days. So one strategy is to recognize when you're in that moment and do something about it. Like pause before you speak to recognize that you're in that situation. And we talk about that in the book. Every book talks about that. You know, it's that simple.

You just have to recognize when you're hangary and then don't be hangary. Sure. Like, I just stop talking. That's my best thing is I go, my wife's like, what's wrong? I'm like, I'm hangary. So I just look out the window until I get food. Nothing good is going to come out if I open my trap. So that works.

And, you know, if I were to ask you how often that works for you out of the 100 times that you're hangary, how often do you recognize it before you've caused damage? It's maximum 50-50. So the trick for me is to avoid hangariness in the first place. Like, as soon as I feel, the gurgling and I start feeling impatient, I go and I get one of those paleo valley meat sticks and shove it into my mouth before I say something crappy. Totally. So this is where we talk about position, right? So if you put yourself in a position where you're not hungry in the first place,

you avoid the whole situation. And so in the book, we talk about safeguards. How do we avoid it? And then if we're in the moment, how do we circumvent our brain so we don't actually have to recognize what's going on in the situation? And by doing that, you can create automatic rules for success. And so there's multiple strategies to actually combat that, but a lot of them happen before the moment of being hangary. Right. It's kind of like instead of having better seatbelts in the car, try not crashing into the wall in the first place. Yeah. Like if you know you're hangary, then, you know, you can put a, I don't know, what a larabar on your island at home. So you know when you're rushed, you can just grab it. You can have one in your car. You can have one at work. You can put things in

place before these things ever happen so you prevent the situation from happening. You can stop. on the way to work. There's a million different ways to do that, but now you're thinking in terms of preventing, you're thinking of what I can do before the moment, and that's a really powerful way to think about it. Another is like an automatic rule for success, right? So we're taught our whole lives, and this is one of the key strategies in the book, and we talk about how to apply this to a variety of situations. We're taught our whole life to follow rules. Here's the speed limit. That's the rule. You know, you show up at this time, you leave at this time, all of these rules, society's rules, tax rules, everything. But we've never thought about how can we actually use rules to our advantage

and circumvent our brain from thinking by just following the rule. We're not thinking of all the rules. We just operate in life and follow them because once we learn a rule, it's like a shortcut in our brain to just do something. So an automatic rule for success, and you can use this in any aspect of life, whether it's like working out or avoiding dessert or not being hangary. You know, my automatic rule is that when I get to work, I have a Lara Bar if I haven't had breakfast. I do love the idea of avoiding these traps. And that kind of goes to the James Clear habit type stuff that maybe we'll touch on later. He's episode, I think, 108 of the show.

And it's not exactly habits right, but it's sort of knowing where your patterns are and going, okay, if I'm hungry every day by one because it's too late for me to eat, I started eating before the show because I didn't get hungry until towards the end of the show. and then by the time I'm at the restaurant with my wife or whatever, it's like, you know, half an hour or too late. So I just started eating before the show, even though I'm not hungry yet, and that's done the trick. But you really have to be able to recognize the pattern of like,

hmm, I'm kind of a dick four days a week at this time. Why is that? Okay, it's because I haven't eaten. And doing that even in business, it gets harder as the pattern becomes more complicated, right? Like towards the end of the month, we've run out of money. Okay, fine. But then that problem becomes more maybe abstract.

or difficult to detect if it's more complex? There's a couple ways to deal with this, right? So like knowing yourself is certainly one of them. But another is I came up with the rule to work out every day because going to the gym two or three days a week was just not working for me. Like it's not working. You can see the stats, right?

Like when I went to the gym and I was going to go to the gym three days a week, I would get up. I'd be like, oh man, I didn't sleep well last night. I got a shit ton of work to do today. I don't feel like going to the gym. I start negotiating with myself. And when I negotiate with myself, I'm like, oh, I'll do more tomorrow. Like, let's skip today.

Double workout tomorrow. Yeah, but then tomorrow comes and you don't do it. So I thought of like, how do I avoid this situation entirely? Because in the moment, I'm negotiating with myself. I don't want to negotiate myself. How do I prevent that? I can tell myself not to negotiate with myself. I can recognize I'm not negotiating with myself.

Or I can just avoid the entire thing together, which is like, I'm going to work out every day. And that changes the conversation in my head. my automatic rule. It's like go to the gym, I sweat every day. And that changes the conversation from if I'm going to work out today to when I work out today and what duration I'm going to work out for today because it's not always going to be 60 minutes. Maybe I just go and I do squats. Maybe I just go for a little run. I can change the duration. But now the negotiation is how do I fit this in? And so I've avoided the whole situation of telling myself I'll do it tomorrow because I've taken that off the table before I've ever reached the moment of decision. One of the other

defaults, the ego default. You mentioned the example of unearned confidence at work. I have to say one of my biggest pet peeves, and I'm sure you get these pitches too because you're a podcaster, if a pitch comes in and has a too shallow of an understanding of a problem, I will never work with that person. It sounds harsh because, oh man, can't you give somebody the opportunity to create a better understanding of the problem? I would love that. However, if you're pitching me earlier, then you think you have a good understanding of the problem. And that's the action. problem. You don't recognize that you have a shallow understanding of the problem. You're just pitching me way too early. And a classic example of someone will go,

hi, I noticed you don't do YouTube shorts or whatever. Let me edit your videos for you. And it's like, ah, you think the problem is that I can't find a video editor. When the problem is I've tested shorts and they don't do anything for my channel, you shouldn't even be pitching me this. You should be pitching me on something else. Therefore, this is either really poorly thought out, despite what you've tailored in the message. Or you've sent this using some sort of AI email bulk send to a zillion people, which means it's not tailored to me.

You haven't even looked at any problem in my channel, and therefore you're pitching me without any of that understanding of my business. It's a delete and a no in a never in a zillion years either way. And I think a lot of people, especially younger folks, shoot themselves in the foot doing things like this. You know, somebody comes in as an intern and they're like, I've got an idea, you should never have in-person meetings. Cool. I appreciate that you read Seth Godin's blog or something once, but we have in-person meetings,

not because we don't know about Zoom, but because there's different things going on here that you literally don't even seem to grasp. Therefore, you can't have valued it. Therefore, your input is worth nothing. It's actually just, you're just wasting my oxygen. Two comments on that. One, you can tell a lot about a person by the way they pitch you. We do this all the time for investing. The way that the deal is presented to us tells us it signals a lot about the type of partner. that we might be entering into business with. If the terms are not fair and they're slanted, then that signals that we probably don't want to work with the person.

If it's overly legal, it signals that we're going to have to rely on contracts to protect us, right? So you want a fair deal that's win-win, which is rare. And that pitch, you can often ascertain this in the pitch. The second thing there is like, I don't know, man. People read about ideas. Maybe it's like page one of Google. And what they miss is ideas exist within the context of an ecosystem.

What works in one particular ecosystem doesn't necessarily mean it's going to work in another. I mean, if you put an elephant in Antarctica, it's not going to survive. You can get this idea and you can grasp it, but you're only grasping it at this like novice level. You have the illusion of knowledge. And then you try to apply it. You email Jordan and you're like, here, I'm going to try to apply this idea to you. But I don't understand you. I don't understand your ecosystem.

That's the pitch. I mean, you're signaling so much when you pitch that, right? which is either, like you said, it's a template email that goes out to everybody. Often it's like insert podcaster's name here. You get those too. And it's not tailored to you and it's not really serving you. And that is a signal. Like, why would I want to work with somebody who doesn't pay attention to the details?

Who doesn't customize their approach to me, who doesn't understand what I'm trying to do or why I'm trying to do it. In the ego chapter, you said something really insightful, which I would love to deconstruct a little. You say, and I'm paraphrasing here, a person who wants the world to see him as great, shows the world how to manipulate that person. It's profound, and you kind of, it was just like that one line sort of throw away whatever in the book. I would love to flesh this out because you're,

this is more relevant than ever, especially with all these politicians we see making, speaking of unforced errors, right? Making all kinds of mistakes and getting in trouble for things. And you're just thinking, how did you not expect this outcome? And the answer almost always is they got manipulated by somebody else because they wear their ego or they,

broadcast their ego and somebody was just like, oh, I can have this guy do whatever I want by telling him what he wants to hear. All right, I'll just do that. So this idea came to me two summers ago when I was traveling with my kids. We were sitting in a lobby of a fancy hotel. And I was like, oh, this is a great opportunity to sort of teach the kids about human nature. And so we look around and everything in fancy places just tends to be amplified. It's a little easier to pick out than day-to-day living. And so we're looking around and we're like, well, what do people value? And like, how do we know what they value? And we found this guy. And I'm telling a different story than the one in the book, but we called him the same name. So that the story,

one of the stories in the book is Mr. Rolex. But we called this guy, Mr. Rolex too. And every picture that people took of him, he like made sure his watch was showing. He would roll up his sleeve. He would posture it. He was always like the right angle. And so I asked the kids, and I was like, what can we learn about somebody like that? Now, probabilistically, like we know nothing about this guy, right? So I want to be clear, we're just thinking in terms of probabilities. We're not trying to, like, pretend that we intimately know this person. Well, we know that he values status.

And his status is wrapped up in his watch. He wants to be seen as powerful, as successful. And if you know that about somebody and you know how they want to be seen, now you can approach them in a way that engenders them to you if you were manipulating them. Yeah. And this is how the world sort of works. If you have a LinkedIn profile or a Twitter bio and, you know, it says Harvard MBA in it, I know you value going to Harvard.

You're signaling something. You're not intending to, but you are signaling something. I have an in to talk to you now. And I know what you value. You value the fact that you went to Harvard. And there's nothing inherently right or wrong with that. but you're showing people how to manipulate you. You're listening to The Jordan Harbinger Show with our guest, Shane Parrish.

We'll be right back. If you're wondering how I managed to book all these amazing authors, thinkers, and creators every single week, it is because of my network, the people around me that I know, like, and trust, and of course, that know like and trust me in return. I'm teaching you how to build the same thing for yourself for free over at Jordan Harbinger.com slash course. This course is about improving your relationship building skills, developing. strong relationships in non-cringy, down-to-earthways, nothing awkward, nothing cheesy,

just practical exercises that take a few minutes a day that will help you become a better connector, a better colleague, a better friend, a better peer, and many of the guests on the show. Subscribe and contribute to the course. So come join us. You'll be in smart company where you belong. You can find the course at Jordan Harbinger.com slash course. Now, back to Shane Parrish. I love the idea of teaching your kids what to look for because it is, I mean, it's super

helpful, whether or not they're going to use it for nefarious purposes or not, I guess is another question. But yeah, you could just remember that guy's face. And if you see him in the bar later, you could say something like, oh, man, that's a really nice watch. Exactly. I was thinking about getting a submariner, but I don't want to get something that's the same as everyone else. Do you have a recommendation? I'm not really much of a watch. And that guy will talk your ear off and probably pay for your whiskey. All night. If you just wind him up and let him go. All night. He'd love to talk about how he knows everything about watches and how much you like his watch. And I feel like I use that a lot for small talk. But yeah, if I were trying to get something from somebody,

I mean, that's the first vector of attack, right? Well, the reason that I teach the kids this is like, now imagine somebody's watching you. What are you signaling unintentionally to other people about what you value, what you want? And they're like, oh, that we really like the iPad, right? Like, you know, and it's, but it's getting them to think about like all these status symbols that people have, They're also, I mean, there's a different side to it, right? You're, again, we're being hierarchical, right? So going back to biology and sort of like RNAate instincts. Some people organize the world such that if I have a Rolex, I am better than you.

And that's how they want to feel about the world. But the flip side of this is like, well, what am I doing? What am I signaling? And then it sort of takes you out of the status game a little bit, right? Because I don't want to get caught up in that. I don't want to be that person. A friend of mine has this great saying that I really love. that stuck with me ever since he said it,

which is the whale that surfaces gets harpooned. Okay. Is that like the tall poppy gets cut? Is that the same thing? Exactly. That's a weird one new one. All whales have to surface. They have to breathe.

So I don't know how much that holds up, but okay. But it's memorable, right? So it makes you think about sort of like coming up for air. If you come up for air, if you signal something status, then you're going to risk getting harpooned. Yeah, the analogy falls apart for me. Well, the tall poppy one doesn't really work either because it's like, well, that's just biology.

You grow, right? There's no choice involved in that. I suppose. You're just among a field of other poppies that are of equal height so that the idea is you try and stay as tall as the other poppies and they don't single you out. Whereas, I don't know, I'm overthinking the analogy.

What else is new? Let's move on to the social default, the bandwagon effect, group think, right, conforming to social pressure and other things that I would imagine we evolved this to survive with tribes and small groups where you don't want to have a bunch of decentered, that decide that their way is better.

At least in the United States and probably also in Canada, we kind of value the outlier who's like, I'm not going to listen to the group. And okay, fine, but yeah, I know that it's easier to rationalize doing something

when other people are doing something. We can outsource our evaluations and critical thinking to the group. However, there is a place where we need to go along with what everyone else is doing. So this one's a little more complex. It's not as black and white,

maybe as the ego or the, not losing control of our emotions. Totally. So going back to social default, it's just a situation where the situation tends to think for you versus you thinking for yourself. If we didn't have that,

we wouldn't exist today. Because as you pointed out, we wouldn't have survived sort of these tribes, the hunter-gatherer phase where we're all helping each other and we're sort of if we all had these random ideas, we'd all go out for food and only one of us would come back. We have to get along with the group and we do get along with the group for the most

part, and that person at work who deviates is only valued if they positively deviate. They're not valued if they negatively deviate. So if you try something new, this is the asymmetry of sort of like the social aspect of this. If you try something new and you're successful and you improve performance, that's great. But if you try something new and you're not successful and performance decreases, well, you're an idiot for trying it. And so the goal is to go back to knowledge, right, to be an expert and to know when, when you can create advantageous divergence, right? So when you can diverge from the crowd and be right. You're not rewarded for diverging.

You have to be correct. Right. Most of the time, you probably want to stay with the tribe, but the expert, the master, sort of knows when to deviate. You're right. Success requires sort of shamelessness. And if you do whatever, what everybody else does, you're going to get the same results everybody else gets,

in most cases anyway. And there's all these sort of like dushy entrepreneur quotes, right? Like entrepreneurs spend a few years of your life like most people won't so you can live the rest of your life like most people can't. You ever hear it? It's like belongs on a poster. No, I've never heard of that one. I think it's an EO thing. And it's just one of those self-congratulating quotes from entrepreneur groups. But it has a kernel of truth in it.

For most people, our desire to fit in often overrides the desire of getting a better outcome. And that's one reason why people rarely try new ways of doing things. and I'm not saying this because like, oh, I left law, and I didn't have a choice, right? I got laid off from law with everybody else. I wasn't getting another job in law. I wasn't good at it, probably. I mean, it's too early in my career. So I kind of almost was forced to try new things, and I think that that was lucky.

I didn't have sort of like this vision that this was the next big thing. I was just kind of like, it's either that or become a police officer or something like that. Not there's anything wrong with that, but it was just, you know, it was a different outcome. to do something different, you need to do something different, like you said, but you also need to be right, I think was your earlier point, right? You can't just be like, I'm doing it this way. It's like, no, you cost the company more money. You're fired.

But if you're like, I'm doing it this way, wow, that saved us $38 million. And our clients are thrilled. You're a managing director now, right? There's a big kind of smorgas board of outcomes, but you have to get the right one. The upside is actually usually more limited to that. When you deviate and you're correct, like in that case, you save 38 million. they'd be like, here's your $5,000 bonus. Right.

And so this also creates a reason to stay in the social. Right. Lose your whole career or maybe get $5,000, but there's a 1% chance of it. Yeah, no, not a good calculation. Why would I try to positively deviate if I can't capture some of the upside? You have to make almost like purposely bad decisions. In the fear of looking like an idiot probably causes a lot of us to never try something new. I was mercilessly ridiculed when I started this podcast in law school and people found out about it.

Yeah. The friends of mine were like, you are ruining your career because some employer is going to find this and be like, you're moonlighting or this is a topic we don't like. Because I was still doing, I was talking about dating and I was like, it was a podcast. It was just talking about whatever I want. Satellite radio, you can drop F bombs if you want to. They almost kind of want you to do that. Satellite, man, be edgy.

And they're like, you're going to get fired. And people would send me these emails either concerned for my career or they'd be like, you're a tool and look at you, you should just focus on law, what a loser. You know, I got stuff like that. And then of course, you know, now they don't think that. But that's only because I ended up winning the game. So this goes to emotion, right? Fear. People don't want to do something different because they fear looking like an idiot. If you did all this and you were wrong and you had to go back and like beg for your job, that prevents people from doing something different. But you're being prevented by a fear of looking like an idiot. And almost everybody who's extremely

successful in the end looks like an idiot in the beginning. Yeah, the trick is how do you know which one it is, right? You don't. You almost have to be like immune to social pressure, which I can't say I was. Maybe I was because I was so already outside of the cool kids club that it didn't matter. It's like what happens when you fall from the rung eight to rung nine on a 10 rung ladder? Who cares, right? It's not like I'm at the top of the pyramid and everyone looks up to me and then suddenly I

have this massive downfall. it's like what's the difference between you know what what's the difference so think about this right like if we're at work and I follow the procedure and I'm wrong and I follow the procedure and I know I'm going to be wrong it doesn't matter you can't fire me I've followed exactly what you told me to do I effectively work at McDonald's because I'm exercising no judgment over what happens but at the same time you you can't get me in trouble so one powerful way to position yourself to exclude the social default or reduce its impact on you is you need to be financially independent. And so that way that you can think independently about the situation.

I don't think there's anything wrong with working at McDonald's for the record. I don't know if that's what you meant to say. No, it wasn't a slight. It was just like it's very procedural. The fries go down for like 90 seconds. You pull them up, you know, like it's just very mechanical. Oh yeah, yeah. Okay, I'll give you that.

The one problem I see, Shane, is that a lot of people are reluctant to change their minds in the face of new information so that people, I don't want to look like a flip-flopper. I get that. You want to change your mind in the face of new information, and yet I don't want to look like I do that for some reason because we don't value that maybe as a society. Somebody recently asked me if I believe the COVID lab leak theory. I went on record as saying there's no evidence for this.

There's no evidence that supports this. People who are saying that have no evidence. And I spoke to a lot of experts, and they were like, it's not likely. I mean, this is like the former head of the CDC and a bunch of epidemiologists were like, no, there's no information. Now there's new information that gets me on the fence like 50-50. people in the know experts will agree with me on my evaluation of that evidence. However, a lot of other people will say like, ha, so you admit you are wrong.

And I bet you think that other conspiracy theory is wrong. And it's annoying, right? Because it's important to change our minds when we get credible evidence and we change our beliefs based on that new evidence. But you have to also come to a belief because of that information in the first place, not because of political or ideological reasons, but because of scientific or evidence-based reasons. It's probably a different podcast.

No, I mean, I think you're on to something, right? There's a lot of things that happen in COVID, right? One, we got a narrative. It was really hard to let go of that narrative once we got that narrative, even in light of new information. And the three words that I remind myself with, and I repeat over and over all the time every day, are outcome over ego. Am I focused on the outcome or am I focused on being right? And it helps me drop my ego and reduce its impact on my decision making, reduce its impact on filtering information. I just want the best outcome. I want my ego and my feelings wrapped up in getting

the best outcome. The best outcome is the most right outcome. So in this case, it's like, there's new information. I change my mind. I don't care what you say about me. Why am I giving you power over me? I don't know you. You don't know me. Why do I even give a shit what you're saying to me? It doesn't matter. What I'm focused on is there's new information coming in. I'm going to adjust Bainzian probability. This is sort of like how we think. We think a baseline. You get new information that confirms or sort of refutes it and you adjust your probability accordingly. Very few things are ever 100%. You spies love Baines. What is it? Bainsian probability. You love that stuff, man. Every intelligence agent is that I know is like, if you read about this, you got to read about this.

You guys live for that stuff. Well, it's just about updating your thinking, right? Which is what we do. It's a fancy name around what we do all the time, right? You're driving a car. You update how hard you hit the break based on how close you are to the other car. Right. You just naturally do this stuff. But when we get new evidence, we tell ourselves a story, A, where does that story come from that we're telling ourselves? So in some cases, it comes from excerpts. Some cases, we're reading a headline by a journalist who writes like 50 articles a year on 50 different topics. Like, are they likely to be an expert or not? I don't think so. But it sticks in our head. The headline sticks in our head. We have no basis for what we're thinking. We can't argue the other side of this

better than somebody else. And in some cases, we actually get information from, you know, I'm going to quote, unquote, trusted sources. And sometimes that's actual information. And sometimes it's proven to be, you know, that they withheld information. And so the only way to deal with the life where all of this is happening is just to update your thinking accordingly. Here's the best thinking I have for today. I am open to changing my mind in light of new information coming in. And if you're not open to that, I don't even want to talk to you. Like what, I mean, what's happening, right? If you don't change your mind when something comes in and sort of refutes what you're saying, then good luck. You mentioned in the book you've got this CEO friend who said that people who have the ability

to change their mind about what they know were the best people to hire. Yeah. You'd also ask them the worst people to hire. I'm curious what that is because is it just the opposite of that? Like people who can't change their minds in the face of new information? Yeah. It's people who can't do that. Because not only do they not do it, they're not quiet about it.

And then they actively work towards not changing their mind and like convincing other people that they're right. And so it's like this poison that sort of like comes into the organization. I think the way you phrased it was people obsessed with minute details that support their point of view, right? So they're grasping at straws because they want to be right about something and they just derail everyone else. Yes, totally. Is that the being on the wrong side of right? Confusing the best outcome with maybe the best, the outcome that makes you look correct or the one that paints you in the best light? Yeah. So the wrong side of right is when you get an idea and it's correct. It will, work, but somebody else has a better idea. And that idea is objectively better. And you're so focused

on proving yourself right that you just ignore a better solution to the problem. You're focused on satisfying your ego and all your cravings and all the dopamine that that gives you rather than the best outcome. And this is why those three words are so powerful, outcome over ego. Just reminding yourself of that mantra when you get into these situations, it's so powerful. Even in the these meetings, right? You can even, if you're running a meeting, one of the things you can do is like, let's focus on the best outcome, not anybody's ego. All of our egos are wrapped up in that outcome. We all want to get the best outcome. It doesn't matter whose solution it is. If you look at this from the outside, it seems almost easy to ask yourself like, oh, who does this in good faith?

Who really thinks, oh, well, I'm wrong about this, but I got to look right. I was going to ask you who actually does this in good faith, but I think I think you're right. There's so many people out there that the narrative in their head is, if I'm not right, I'm worthless or I'm a bad person or I don't belong in the room with the rest of these people. And it's almost never the case. But it's got to be just, I think for some people, it's a tough lesson to learn and internalize because their value, their entire sense of self-worth is wrapped up and being correct about things. 100%. This is how I happened on this idea. I was working at the intelligence agency. I'm a knowledge worker. I'm paid to come up with solutions to problems. If my solution is not correct,

Why am I in this room with all these other really smart, intelligent people? I need to contribute. My contribution in some ways comes from the ideas that we have. And if my ideas aren't correct, well, then my whole sense of who I am and my identity, again, going back to territorial, right? So we think of territorial as physical, where, you know, a wolf walks around and pees on the corners. But territory for us is also how we see ourselves, how we see our identity.

If you infringe on that, I'm going to respond without reasoning. I'm not going to think clearly. I'm going to react like the animal that I am. When you get wrapped up with your ego and your identity and somebody says, here's a better solution, you're just like, no, that's not a better solution. Like here's, you know, this minute detail that supports my point. And you just run with this.

And then you start, again, going back to what we talked about first, now you're on a detour, right? you're eventually going to fix this detour, and the longer you go, the farther you go, the more time it's going to cost you, the more energy it's going to cost you. And the longer it's going to take you to get to your destination. I used to think that people were just bad at weighing different criteria. But now I think you're right. I think a lot of it is ego. I still see bad decision makers say things like, okay, well, and this is probably a bad example, but okay, this ticket's $1,000 cheaper, but it gets in four hours early. What happened? Maybe something will happen in that hours that's worth that and you're like what is the probability of that's like zero you're getting it at 7 a.m instead of 11 a.m like you still it's fine you just like tear your hair out thinking why are you weighing this at the same level as the cost and the ticket or why are you weighing going to this city instead of that city when you haven't been to either one and now you're googling what color is the sand on the beach is the sand whiter in spain or Portugal i don't know it's just stupid and but i think a lot of it

does come down to ego because they're like, well, clearly this place is the better choice, but I already told everyone I was going to this place. So I need to rationalize a reason and come up with evidence to bolster my case why I was right initially. And it's really hard to dig out of that. It's really hard. Yeah, it totally is, right? And we catch ourselves doing this lots. That's a great example of sort of how you can end up in the situation unintentionally. A good way out of this is just to, I mean, it sucks the first time. And then it becomes, comes a lot easier. You send an email and be like, ah, you know what? I was wrong. I changed my mind. When's the last time you said, I changed my mind. Like, I changed my mind during this episode when I'm

like, I'm probably not going to use that whale that surfaces analogy anymore because it sort of falls apart and you're right. So like I changed my mind about using that. Oh, good. I didn't like that. There's a better, there's got to be a better way to say this. Yeah. But when's the last time you consciously you're like, oh, I'm wrong. Let me change my mind about that. Yeah, it's tough, especially with a stranger right in an email. It's like, oh, I don't want to, I don't want them to think they can persuade me. Why? Isn't that kind of their job? You're hiring this person as a consultant. I don't want them to know that they could possibly be effective in this position. They better not be right. They better not be right about anything else. I'm going to be super upset. I'm going to pay this person

thousands of dollars. They better be wrong about everything from here on out. Well, it's interesting. I had a friend who's a consultant and he's like, it's the easiest money I ever had. I go in there, I find out what they want and then I tell them to do that. Jeez. And I'm like, what? And he's like, well, you know, when I started in consulting, I would go in and tell them what I actually thought. And he's like, it was just like mortal combat. They'd never hire me back. So he's like, I found out what they want. I'd just give them that.

And I could hire back all the time. So it's like this external validation of what people already want going back to ego, right? It's terrible. And I worked in a business. And this should have been the writing on the wall, but it was more, there was a lot of writing on the wall by the time I was done. We would hire consultants to fix certain problems. And when they gave us advice that one of the other partners didn't like,

like he would figure out a reason why they were a terrible fit, not a cultural fit, didn't understand our business and fire them. And it would be like we'd fire the lawyer and then we'd fire the tax account and then we'd fire the other consultant. I'm like, these guys were all pretty smart and they came to the same conclusion. Maybe my business partner is the guy with his head of, his keyster. And of course, you know, he's still doing that. There's a lot of a lack of self-accountability, but also a lack of self-knowledge,

which I'd love to talk about, knowing what you know and don't know, cognitive blind spots are crazy. We talk about these a lot on the show, but knowing where you have an edge sticking to that, every time I invest in a space that I don't really understand, I almost always regret it. Even if the investment turns out well, it's such a wild ride that I decided not to do that anymore.

I really only invest in things that I truly understand, and that's not surprisingly where I've had the most success. And then, of course, index funds, which are, I don't need to understand them to, deeply to know that they're safer, right? Well, let's back this up a little bit here. So, like, let's think about how we actually learn and become sort of like masters in a subject. And I have an idea about learning, and I call it the learning loop.

And if you picture a clock at the 12 hand, there's sort of an experience. At the three hand, you have a reflection. At the six hand, you have a compression or abstraction. And at the nine hand, you have an action. That action leads to experience. You can have multiple different types of experience, like this conversation. is an experience. I can read a book. That's an experience. I can do something and I can live that experience. And that experience gives me information. It gives me gigabytes of data. And I reflect on that

experience. And my reflection is like, how does my brain compress this? How do I keep the essential information and get rid of all the other stuff? Because I can't store all this information in my head. So I want to take what matters from this experience. And then I want to compress it. And I compress it into sort of an abstraction. Outcome over ego is a great example of sort of a compression. Now, if I tell you outcome over ego, I'm giving you the compression. You haven't done the reflection. And so you don't have the same sort of knowledge around that statement that I have and it carries different meanings for us. You might still be able to use it. Tim Urban has this thing and he told me about it, which was the chef and the line cook. And I sort of think about it a bit differently,

like the chef and me at home. And if I follow the chef's recipe and everything works out, it tastes amazing. It tastes just like it does in the restaurant. If I follow the chef's recipe and it doesn't work out, well, I mean,

he or she could show up at my house, taste it, and instantly know what's wrong. Too high of heat, not enough salt. You stirred it the wrong way. You didn't bake it long enough. They instantly know

because they know all the ways that it can go wrong. That's real knowledge. And so self-knowledge is, How do we figure out where we have an edge and where we can play that game? And if we don't have an edge, going back to social, best practices are a great way to develop our edge before we find one. You want positive deviation. If you don't know when you're positively deviating, then you shouldn't deviate.

This is the Jordan Harbinger show with our guest, Shane Parrish. We'll be right back. If you like this show, I invite you to do what other smart and considerate listeners do, which is take a moment and support our amazing sponsors. All the deals, discounts, and ways to support the show are on the website at Jordan Harbinger.com slash deals. You can also search for any sponsor using the AI chatbot on the website as well. Or you can even, if you're super lazy, you can email me, Jordan at Jordan Harbinger.com.

I'll dig up the code for you. I might shame you a little, but I'll still do it for you. Thank you for supporting those who support the show. Now for the rest of my conversation with Shane Parrish. I think the problem with gaining this level of self-knowledge is that it requires patience and a lot of work. If you don't know your weaknesses, somebody else, if they can figure out, they're just going to use them to exploit you. And I know that sounds a little confrontational,

but I see this a lot of times with podcast marketing. I won't get too deep in the weeds here, but people will pitch me something. And I'm like, well, what about this? And they'll go, oh, well, we're still working on that. And other people will buy this. And they'll be like, oh, I don't know if this worked because of X, Y, Z. I'm like, the problem is you can't,

there's no retention metric. And they'll go, oh, I didn't even think about that. Because I'm going step by step by step by step. And I'm like, there's a gap here in the data. are you just assuming that that's going to be 100%? And they're like, well, we assume it's probably around 50%. I'm like, I think it's probably more like 5%. And if it's at 5%, the ROI is not even close.

If it's at 50%, it's barely there. This has to be close to 100% to actually be better than just running ads on Facebook or whatever, for example. And they'll go, oh, well, I mean, you know, I guess your calculations are different than ours. And I'm like, surprise, surprise. You assume your product's going to be 100% effective. And I assume it's going to be 5% effective. even if we meet in the middle, I'm still losing money and I'm giving it to you. No, thanks.

There's so much of that in any business. So a couple thoughts there. One of those other little statements that I carry around with myself is a lack of patience changes the outcome. And so when you know how to get something and you try to speed it up beyond what's natural, like we all know how to sort of get financial independence. We have to save more money than we spend. We diligently put that into like an index fund and we wait like 50 years.

And if you do that, you're going to have a great retirement nest egg. You're not going to have to worry about anything. But we don't want that. We want to get rich quick. We want to go to the weekend seminar and learn how to make millions of dollars because we think that's the fast track. I think we get caught up in that. We also get caught up in that at work, right?

And the other thing that sort of came to mind with what you were saying is think of at work and the opportunities that we get. If you're treating your job like it's a job, and I'm, your boss and somebody else is treating their job like it's a career and they're all in and you're sort of a nine to five mentality they're going to get the opportunities that you don't get why am i going to go all in with somebody who's not all in on what they're doing you know why am i going to invest or take a chance on somebody and this is what we do we we we sort of like collectively a lot of people walk around and they're like when is the world going to recognize my potential when is the

world going to give me what I deserve. And then you end up in a bar drinking and you're like, man, if only people saw how good I was, well, you got to go positive and go first. Peter Kaufman told me that you have to get off your butt. You have to like go out there and invest. Why are people going to take a chance on you if you're not all in with them? I think young people are actually kind of better at this and I don't know why. I think maybe because they have less to lose or maybe there's even less ego because they're young and it's okay to look like you don't know what you're doing. Warren Buffett in your book, you write that he never wants to make a decision unless he knows the other side's argument even better than they do.

I think that's an amazing decision-making standard. It's very high because then you've got to be able to argue both sides really well. You can decide on the one that has the strongest arguments versus the side that you simply understand better or that you have more information about at that particular time. That has to be quite a strong rule for him because it's a very very very important. very high standard. I do this with my kids all the time, right? They'll come to me and they'll be like, you know, my brother did this, blah, blah, blah, and he thinks this. And I'm like, okay, now take the other side of it. Now argue from your brother's point of view. What's he going to tell me? And it just really

opens your eyes to different perspectives because if you think of decision making, the source of all of our problems is blind spots. We're blind to something. If we had perfect information, we'd always make perfect decisions. How do we get out of that? Well, one way that we can remove blind spots is to see things through a different perspective. Part of the right to have an opinion is you can see the other perspective just as good, if not better, than somebody else. Yes, you can just sort of hypothetically argue for the other person. That's a good one with the kids. But I think when it comes to business or investing, to pitch yourself something really strongly and then to also argue against that, you really have to know every little nook and cranny in there. Right. But that shows you the depth of

knowledge you need to have to have an edge. You can't do that in everything. So, Like, you drop a lot of your opinion. I don't have time for this. I can't focus on that. I need to become an expert in this particular thing. I need to go all in in this particular path because that's going to give me that knowledge where I know, what I know, and where the edge of my knowledge is and how do I use that information?

And you can't do that with like a million subjects. But we all think we're experts on everything. We're experts on politics. I can fix the homeless crisis. Like, we think we know these things. But like, get in the arena and try them out. and you're going to find out that, like, you don't know them as well as you think you do. And you can't have an opinion on, like, well-reasoned opinion on hundreds of different things.

Like, it just doesn't make sense. Many of us have been taught that solving problems, that's how we add value, right? Oh, I got hired here to solve problems. I'm a problem solver. It's part of our identity. And people are really quick to jump into an assessment of the problem and then throw as many resources as they can muster at solving that problem. And people with different ideas of what the problem actually is, we don't even want to

to hear it, right? They're pushed away by social pressure. Hey, we've already decided what the problem is. We don't want you to drag us backwards and try and reassess. Everyone's moving forward in the other direction. So we're taught to solve problems, I guess, even in school, but we're rarely taught to define the problem in the first place. And of course, knowing which direction you're going to row is just as important as learning how to row. So remember at the beginning we talked about clear thinking and one of the key elements to clear thinking is positioning and not just being, forced to recognize in the moment that something's going haywire, but setting yourself up in the right position so that your strategy negates that. And so what tends to happen at work, if you work with

smart people, you get into a meeting room, you book a one hour meeting, you make a decision and you solve a problem, and then you choose a course of action. So you call the meeting, you kind of vaguely know what the problem is, you come into the room, somebody says something that sounds reasonably correct about what the problem is. And then everybody jumps into solution mode. Everybody jumps into, oh, here's how to solve that problem. And then all of a sudden, you have this inertia that takes over and you've solved the wrong problem. So there's a couple safeguards that you can put in place around this to prevent that from happening. One is the person who makes the decision owns the problem statement. So whoever's actually responsible for making the decision has to have

accountability for defining what the problem is. They can take input from everybody else. but they're the person that has to own the problem. And the second way you can create a safeguard around this is to create a firewall between these two meetings. So if you were going to have an hour meeting, you can have a 30-minute meeting one day, and that meeting can just be focused on let's identify what the problem is. Let's get on the same page. What do you see in the situation that nobody else sees?

How can I gather as much relevant information, as many different perspectives into this as I can, so that we can get at the root problem instead of just solving the first problem that comes up? right? You take a night. Most decisions don't need to be made the same day. I mean, I used to work in operations. Like very few of those decisions that you need to make on the spot in the moment. You can often wait 24 to 72 hours with very little impact to things. When you come back the next day, what happens is two things. One, you have a clear view of what the problem is. Everybody is basically on the same page. You also allow other people to contribute. And the other people who contribute are the

people in the meeting who might not be extroverts, who might not want to signal something or might have a really different view and they're worried about how they're going to be perceived or they're worried about going against somebody in the meeting or having a different perspective. But what might happen if you encourage it right and you create the right environment is they're going to email you, here's what I think. Like I'm going to contribute to this, but I'm going to do it outside of the meeting. Well, now I've got a lot of valuable different perspectives in terms of what the problem is. I'm going to have a much clearer sense of the problem that actually needs to be solved. So again, all that energy is going to go towards solving the right problem instead

of these detours that we normally do. This is why we're so stressed, right? This is why we're so busy at work. If you actually look at what people are doing, they're spending the vast majority of their time correcting mistakes that they've made, solving the wrong problems, not really solving the problem, miscommunications around things. This is part of the reason that we feel so busy about things.

And we think that miscommunication is a great example. We think, oh, we'll just communicate more. It's not communicating more. It's communicating effectively. And getting rid of, you know, paragraphs. to say something that a sentence should say. And this is why the ownership comes in and the accountability of the person

who makes the decision has to own it. When I worked at the intelligence agency, one of the things I was trying to do right before I left is like, I want the person's name who designed this form on this form. Because we're getting asked to fill in the same information like 16 times. I want to know who's responsible for this.

And I knew I never had to solve the problem. If I could get them to put a name on it or a group on it, It would solve itself because everybody would be so embarrassed at the state of things. They would just correct it. That's funny. Accountability by just forcing it. Like, hey, if you don't like this form or you have a question, call Shane Parrish.

Here's his extension. And people go, oh, God, you know, how can I make this? Exactly. Someone goes, why do I have to fill my name out 16 times? There should be a drop down. I should just be able to be saved on my whatever. And it's like, okay, I'm coding that now because I've taken 12 angry phone calls from people and they're all right.

Yeah. Well, this is a form of safeguard, right? So one of the same, if you want the person who's responsible for the decision to take it seriously, they have to have their name on it. And by putting their name on it, they're going to take that process more seriously. They're going to search for better inputs. They're going to try to look at things from different perspectives. And they're going to try to solve the real problem because they're putting their name

and their reputation and sort of their ego on the actual problem. And it probably leads to some innovation because you're going to get a go-getter kid who gets assigned something and he's going to go and put my name on this. I bet I could code something in the CMS that, makes this really easy. And then everybody goes, oh, can you do that for me? And then suddenly, instead of paper forms that go into an outbox and an inbox, you've got an online intranet-based system that when you're logged in, it populates all the information. And people are like, oh, my God, they do this in one minute, 60, you know, I do this in 60 seconds instead of 60 minutes.

This is amazing. And you end up with an efficiency boost because of that accountability safeguard. Right. I'd love to talk more about deciding what the problem is and evaluating the problem. And you really spoke to me with this one part of the book. He said, problem solving novices usually try to narrow things down to two options. They feel they've boiled the problem down to its essence when they have not. And of course, it's just easier cognitively to decide between two things. And this is a dangerous oversimplification that creates blind spots. I can't remember the last time I was dealing with three options. My brain just wants two options only. If I have three options, I'm immediately discarding one based on almost arbitrary criteria because I don't my brain can't juggle.

Why is that? Why do we want these sort of like binary choices, this false duality between two things? And if you look at, if you, yeah, you look at corporate presentations, man, I've sat through thousands of these things at this point. And there's always like, we're out of fork in the road. We have to take one of two paths. Like one path is sort of like status quo. And then one path is like the solution that I came up with. It's like, well, those, what the heck? This whole thing is oriented towards like inertia around going down that path. It's like, are we actually thinking here? No, because if you were thinking and you were an expert, you could probably come up with a lot

of things that you could do, including not actually going down that path fully, what's the next step that's going to give us more information to allow us to evaluate different options? And if you think in terms of optionality or position to come back to common vocabulary that we've talked about today, you think about what's the next step? what puts us in the position to handle multiple futures? Because we don't know how the world's going to change. Can we just take this little baby step? Why do we have to decide on this big project that's going to take four years?

What's the next step in that project that we can take? Or what are the different options of things that we could do? Because every time you do something, you're not doing something else. There's an opportunity cost to all of this stuff too. And we never think of that. It's your alternatives that matter, right? If you're ignoring the opportunity cost, to your point with your analogy with the fork, there's a reasonable alternative where you turn back down the road and you never actually get to the fork.

One way door or two way doors, right? Like, can I go through this and backtrack? In which case, like, why are we having this meeting? Just go and run with it. Because we want to build up judgment in an organization. We want to trust people. And the only way to do that is to give them opportunities to exercise judgment and then have them walk through that judgment with you. So if you go through a two-way door, you can come back, right? So the cost of that decision is really low. You want to go through that door as quickly as possible, you want people to exercise judgment and take that step. And if it's a one-way door where you go through and you can't come back, well, can I just open a little crack and see what's on the other side before I go through that door? But we don't

ever think in terms of like inching our position forward or what the next beachhead is. We think of in terms of like, here's the destination. You are going here. And it's like, well, maybe I'd get halfway there and I don't want to go there anymore. And so you have to be open, again, coming back to what we talked about earlier, changing your mind, right? Outcome over ego. going towards the best outcome. Annie Duke helped me with this. I had a real hard decision, I don't even know, like a year ago,

episode 757 before the show, I was like, hey, what about this and this and this? And it really kind of stacked up evenly on each side at that point in time. And she goes, well, which decision has more optionality? And I said, what do you mean? She's like, which one could you more easily undo? And that part was relatively clear.

I was like, oh, if I have to undo the decision, well, then it would be this one. She's like, then definitely, you take that one. Because it sounds like there's a lot of, unknowns and variables and ambiguity with this, that, and the other thing, choose the place with more optionality, the one that gives you more optionality. And that was, that was absolutely the right choice. Another practical you give is imagine one option is off the table. Take me through that. I think that's a really good way to shake up a decision. Yeah. So like going back to that hypothetical

sort of presentation where it's like we can choose path A or status quo, well, what if we can't choose path A? Now what? Is it just status quo or is there something else we can do? you can sort of force a couple of things here. One, you can force yourself to recognize what matters most to you. I think we talk about sticky notes and sort of the book, where you compare sticky notes. And like you can only hold one at a time. So the winning sticky note will always just be one. And it doesn't mean that only one thing matters, but it means like you're going to help

identify what's most important to you. The other thing is like, again, go back to this false duality. It's like, here are two choices. It's like, okay, well, let's just imagine we can't do choice A, what the world looks like now and what happens. And let's imagine we can't do choice B and what the world looks like. And then you often come up with, hey, there's this little baby step or there's this other path that we didn't quite see because if both of these options are off the table, we still have to do something. And we'd approach the problem completely differently. And that information helps inform either,

oh, no, these paths are correct or, man, we're really missing something and we need to go gather some information around this. In that same vein, you also talk, you have this mental exercise about making criteria battle. Can you tell us how to do this? I love this. That was sort of the sticky note idea, right? Oh, I see. That's the sticky note thing?

Yeah, you have these two competing criteria, but what matters. And often, you know, you're trying to pick the most important thing and you're trying to optimize for that thing. And that's not to say that there is one most important thing. But I've been in so many meetings where everybody's like, no, there's 10 most important things. And it's like, come on, guys. Like, that's BS, right?

And the reason we don't want to pick one most important thing, going back again to sort of like ego, we don't want to be wrong because if we pick one thing, we might be wrong. So we're going to like couch this and abstract it into 10. So no matter what, at the end of this, I could be like, yeah, I knew that was important. But it's like, no, you didn't think that was as important as it should have been. And so the way to battle this out is like write down each criteria on a sticky note and then sort of like hold up one and then compete with the other one and then put down the loser and pick up the next one.

And at the end of it, you're left with one thing. And you can sort of like force rank through this. And that'll give you an idea of like what really matters. And if we have to make decisions at the end of the day based on one criteria, we know what that criteria is. More importantly, your team, if you're the decision maker and you're not there, your team will know what's most important to you. They'll know what the most important criteria is because you've told them.

And that empowers them to exercise judgment and to go fast. How do we know when we have gathered enough information to make a decision? That I think a lot of people get caught in this analysis paralysis where I sort of touched on this in the middle of the show, oh, should I go to this place or this place? And now they're Googling the color of the sand or how hot the beaches are and do you need flip-flops or whatever. You really get stuck in the minutia and you can't make a decision. How do I know, all right, I've got, I'm 90% of the way there. Stop researching, make the decision.

In the book, we talk about ASAP or A-Lab. And you make the decision as soon as possible if it's a two-way door or as late as possible if it's a one-way. door and obviously everything's on a spectrum, but how do you know it's as late as possible? This is the question everybody has. And it's stop, flop or no. You stop gathering useful information. Flop is the first lost opportunity. You're about to lose an opportunity. You've waited as long as possible, but there's a clock on it. The offer's expiring. The investment rounds closing, whatever it is. Or you know, you know what to do. And you don't have to make a decision before any of those three things. And so you can wait. And when you're waiting, you have optionality.

this goes back to sort of what you were talking about earlier. You can change your mind. You can passively gather new information, but you're not forcing yourself to decide. And it's not really a conscious thing running through your head. You're sort of like looking for information, but you're not out seeking it. And so it's not one of these threads that you have running in your head.

And when we're gathering information on things, the problem is most of us don't make a lot of decisions we should make as soon as possible as soon as possible. When you think of like you can quantify it in terms of time, you can quantify it in terms of money, it doesn't really matter. Let's say hypothetically you're making a decision. It's under 100 bucks. You want to make that decision under 10 minutes. That's as soon as possible. And you can set a 10 minute timer and be like, I'm going to make this decision in 10 minutes. I'm going to do all my research for 10 minutes and then I'm going to make the best decision possible. That's an easy decision to sort of undo a low cost decision. The cost of being wrong in that decision isn't high. When the cost of being wrong is high, you want to wait as late as possible in terms of have more processor and structure around that decision. So as late as possible is a great one, right? You stop gathering useful information. The first lost opportunity, it's going to go away or you know what to do. One of the signs that you've gathered

enough information is like you just find yourself sort of like playing this song on loop in your head over and over. You're just arguing the same points. Another is that you can argue the other side. This is something we talked about earlier. The work required to have an opinion. You can argue the other side as well as other people. And gathering more information in that point, isn't really going to help you further understand things. And then sort of the other one is you find yourself wanting to learn more, but you keep coming across the same information. So you've stopped gathering anything that's useful. Yeah, you're in this sort of loop reviewing the same argument or information over and over. And I find myself doing this quite, or I used to. Now I make

decisions faster. I'm only 43. It took me 43 years to get here. But I finally realized, oh, I don't need to go into like Reddit threads from 12 years ago to find the one consideration that I haven't come across reading every single review of this product. Maybe just buy the thing. And then you can return it if you don't like it. So you're just, the whole thing's been a wasted time because it's a two-way door with an old Amazon Prime taking the lead here.

I've really find all of these decision-making habits. They all kind of hit close to home. If you really look at your past behavior, one thing that you'd said in the book that I'm so guilty of, confidence increases faster than accuracy. When we're trying to make a decision, we sort of secretly make a decision in our heads, or at least I have, and then we gain confidence from additional information that supports that

conclusion, which then feeds our confirmation bias and tells us that we're right. And then when another piece of information comes and contradicts that, we're like, well, I don't know if that really, I'm not going to weigh that as heavily because it sort of goes against the thing. And you need so much information at that point to decide that you're wrong, that it's almost pointless even doing the research, because you need a waterfall of information against the choice that you've already picked. And I do this all the time, right? I find myself coming to a conclusion and researching, but then silently arguing for the side that I picked. And it's very hard to break that habit. Yeah, it's just confidence, right? You're only, because you'll discount all the

information. I think Charlie Munger said, like, once a sperm gets in an egg, it sort of closes itself off. And ideas are much like that in our head. Once we get an idea and we sort of feel like we know what to do, it's almost impossible to change that. No matter what we come across. This website, like nobody reads this website. Like, you find a lot of it. You find, you find, something that just totally contradicts you and you would find a way the smarter you are, the better you would discount that way and ignore it. So this is why cognitive biases are really good at explaining why we made mistakes, but really bad at preventing us from making mistakes in the future.

You can't have a checklist of cognitive biases where you can't go through and be like, oh, am I overconfident? Nope, not overconfident. Check. It doesn't work that way because the smarter you are, the better of the story you're going to tell yourself about all the research you did, why you're not. overconfident, how you weighed the evidence, but often he doesn't work that way. Shane, thank you very much.

I know you've got to go pick up the kiddos. I really appreciate you coming on, man. Next time we've got to do it in person, even though I know we said that for the last 10 years. But one day, it'll happen. I would love that. Thanks, Jordan. You got it, man.

We've got a preview trailer of our interview with poker star Annie Duke on how we can learn to make better decisions by thinking in bets instead of trying so hard to be certain all the time. The quality of your life is determined by the story. of two things, the quality of your decisions and luck, when something bad happens to us, we act as a skill wasn't involved at all. We just sort of pawned off to the luck element. But when good things happen, we sort of ignore the luck element and we say that it was because of our great skill. A self-driving Uber just hit and killed a pedestrian. But what I thought

was really interesting was that the reaction was to suspend the test it and just to take the cars off the road, not just the Uber cars, but other self-driving vehicles. And what I didn't see were any comparisons to how self-driving vehicles did per thousand miles traveled versus the technology that we already have on the road, which is cars that are driven by humans. We know that 6,000 pedestrians die per year by regular driven cars. Let's say that you're on the side of the road and you've got a flat tire. And of course, what everybody's thinking in that moment is I have the worst life ever. Like, why do these things always happen to me? I'm so unlucky. I'm so miserable. What's really interesting to me about it is like you could have gotten a

promotion, like the biggest promotion of your life three days before. And you're not standing on the side of the road going, my life's great because I just got the biggest promotion I could ever imagine. So imagine that you had this flat tire a year ago. And now I'm asking you today, a year later, How much do you think that that flat tire would have affected your overall happiness over the year? For more with any Duke, including some common mistakes we make when evaluating decisions,

check out episode 40 here on the Jordan Harbinger show. Again, it's all about being in the proper position. He had a good analogy in the book with the game Tetris. If you're good at playing Tetris, you can use any piece that comes your way. But if you're bad at Tetris, you always need just the right piece at the right time to avoid getting screwed.

paraphrasing here, but your position, of course, depends on thinking clearly. And that is the show that we created for you here today. And I hope it was helpful. There's a lot more practical stuff in the book, such as writing down the way you make a decision. When you write your thoughts down beforehand, you can't lie to yourself, right? Other people can see your thinking. Also, we mentioned the flop. Some decisions you make as soon as possible, right? The other ones, when you make them as late as possible, late is decided by the time you start losing opportunities. So the flop is the first lost opportunity. That is when it is time to decide. Otherwise, your options start narrowing. You lose optionality, in other words, and your opportunities dwindle in a way that might not be advantageous for you.

So that's how you decide when it's as late as possible. I'm not sure that was clear in the show. So I wanted to clear that up with him and then throw this in the show close. More on decision-making with Annie Duke. That was episode 757. Actually, we did a couple episodes where the most recent was 757. Again, in Shane's book, lots of practicals about clearer thinking and decision-making. We'll link to the book in the show notes. And when you shop, using our links. It does help out the show just a little bit. Again, all things Shane Parrish in the show notes over at Jordan Harbinger.com.

Transcripts in the show notes as well. Advertisers, deals, discounts, and ways to support the show, all at Jordan Harbinger.com slash deals. Please consider supporting those who support the show. Also, our newsletter every week, the team and I dig into an older episode of the show. We dissect lessons from it. And I do giveaways on there. I haven't started yet, but I'm going to start giving away a lot of the stuff that I get

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