Thinking big, acting bold and long term does not come naturally for most of us. Why so? Why fear of failure invokes stronger emotions than lure of success? What makes us avoid risks and play safe? Here is what I learnt on this subject.
Roots of our intuitions
The central theme of evolution is survival or adapting oneself to improve chances of survival. Our ancestors in the prehistoric times had to go through the struggle for survival like every other animal. And they developed few instincts to help them survive. But some of them have lost relevance now.
Short term and risk averse tendencies of our ancestors
During the stone age, when humans were hunters-gatherers, food was scarce. The kill was not always enough to satisfy group’s hunger. Whoever got to eat first had better chances of survival. Not only acting selfish, one had to think short term, one meal at a time as no one knew when would be the next meal coming. Also, it paid to avoid great dangers. The noise in the bush would be that of a Rabbit or it could be a hungry Tiger as well. Those who took risks often did not survive long. Those who applied caution survived longer and produced off springs of their own kind. Since this struggle for survival continued for a really long period, these survival instincts got etched into human psyche. We descended from such ancestors. No wonder many of us have selfish, short term thinking and risk averse tendencies.
What happened thereafter?
Humans learnt agriculture and to store the food grains. The need for most of humans to be farmers was gone a few hundred years ago and we got spread into other streams like manufacturing, trade, arts etc. Now we take up a profession or run a business to earn a living. Our worries have shifted to monthly pay check and other things. No more we struggle for food and survival on daily basis. But in the time scale of evolution, this period of non-struggle is not long enough to change what is already hardwired into our thinking. Our intuitions still guide us to play safe often or become short term focused. Even when there is no threat to survival, our intuitions limit us from acting bold or thinking big.
Bucking
the convention
Many
individuals (and companies) were able to defy these natural tendencies and became counter-intuitive. Warren Buffett is a
long-term investor. Long-term denotes he overcame the natural tendency of thinking short term. Investing means he has embraced the risks. Jeff Bezos unconventional thinking has rewarded him hugely.
Are you a Giver or a Taker?
Adam Grant
in his book “Give and Take” explains how givers, though small in
numbers, build networks and flourish. Takers who act selfishly might gain in
the short term, but the givers have an edge in the long run as they build
trust, credibility, promote reciprocation and provide a direction. Individuals or
organizations who stepped up to solve a problem in unconventional ways produced a
ripple effect. Think of big companies like Google and Facebook and how their unconventional business models worked out well for them.
How to become counter-intuitive or retrain our intuition?
Daniel
Kahneman, a behavioral psychologist who won a Nobel Prize for his work, explains
in his book “Thinking Fast and Slow” that we have two systems of thinking.
System 1 thinking which is quick, intuitive but often biased. System 2 thinking
is a slow, analytical thinking process where reasoning becomes the focus and that
helps to overcome bias. He suggests that until we become proficient or an
expert in a field, we should not use System 1 thinking to make decisions. We
need to train and retrain with System 2 thinking for our judgements to improve.
Summary
Acknowledging the fact that long term thinking does not come naturally to us and making conscious efforts to overcome our selfish and risk-averse tendencies improves our judgements and actions.
Influences:
1. Sapiens and Homo Deus by Yuval Noah Harrari
2. Naval Ravikant podcast
