#77 Do Not Take Business Advice From Dart Throwing Monkeys: Experts Aren't

In my last post I beat on CEOs. This week I’d like to spread that love around.

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I want to beat on folks that claim to be forward seers in their field. And I’m going to start with folks that comment and advise on political and economic trends. Things that, at the macro level, matter a lot to our businesses.

A psychologist named Philip Tetlock ran a 20 year study on 284 of these types of folks.  He asked them to assess probabilities of certain events happening in the near future. He gathered a total of 80,000 data points - some in the experts regions of expertise and some in related areas.

I’ll let my favorite psychologist, Nobel Prize winner Daniel Kahneman, tell you how well the gurus did. Here’s a quote from page 219 of his book Thinking Fast and Slow…

“…People who spend their time, and earn their living, studying a particular topic produce poorer predictions than dart-throwing monkeys who would have distributed their choices evenly over the options. Even in the region they knew best, experts were not significantly better than nonspecialists.”

And the news gets worse for the most knowledgeable in the crowd. Here’s more commentary from Kahneman…

“The person who acquires more knowledge develops an enhanced illusion of her skill and becomes unrealistically overconfident.”

And, as you would expect, these overconfident gurus struggled to admit their misses. They were fabulous at making excuses. And, per Kahneman, here’s a potential reason why (page 263 of Thinking Fast and Slow).

“Experts who acknowledge the full extent of their ignorance may expect to be replaced by more confident competitors, who are better able to gain the trust of clients. An unbiased appreciation of uncertainty is a cornerstone of rationality - but it is not what people and organizations want. Extreme uncertainty is paralyzing under dangerous circumstances, and the admission that one is merely guessing is especially unacceptable when the stakes are high. Acting on pretend knowledge is often the preferred solution.”

So, when surrounded by uncertainty, they pretend to know what's going on.  And, if their guesses turn out wrong, they make excuses.

OK, so how do these folks keep their jobs and/or lofty reputations?  Why do their faces keep showing up on news and financial networks? 

And, even more confusing, why do we listen?

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MARKETING GURUS AND STRATEGISTS

You may not pay much attention to the talking heads in politics or economics, but how about a little closer to home? Have you ever hired a marketing guru or a strategist? Someone that claimed they could crank up your lead flow or make your business viral?

Now I’m not talking about your nuts and bolts marketing advisor who helps navigate social media for you. Or who handles your trade show strategy. Or who’s diving into the analytics behind your lead flow. I’m talking about the big promise folks that suggest only they can take your business to the big leagues. 

These are the folks that are flat out full of shit. If they knew how to consistently crank out big hits they’d be doing it for themselves and their own businesses. 

Avoid these overpriced dart-throwing monkeys and, instead, invest in yourself and your team. You’re the future seers when it comes to your business.

THE MAP

(This site is all about building a Map that will help me do work and life better. So at the end of each post I check in to see if any changes / insights come to mind.)

This post is about a massive Wrong Story - the idea that a guru can deliver an amazing future for your business. It’ll always be tempting to believe in this business magic bullet, but it’s BS and you have to Confront it.

On a larger scale, this post gets to why you should have Maps in the first place. You are the guru. No one is a better seer of the future of your business than you. And the sooner you lock in on what you and your business stand for the sooner you can brighten that future.

And yes, there’ll still be pain and mistakes.
And no, you’ll never reach a state of perfect security.
But, you will have a set of guiding principles that will increase your odds of surviving and thriving. 

And that’s as good as it gets.

A SUMMER SERIES

Daniel Kahneman’s book - Thinking Fast and Slow - is my favorite Wrong Stories book. He does a great job of explaining how we come to wrong or biased conclusions. And that’s why I’m doing this series of posts covering the topics that Kahneman writes about. Here’s a list of the prior posts in the series.

# 73 - Being A Jerk Seems To Work
# 74 - A Well Timed Pizza Could Have Changed Old Red’s Life
# 75 - Does Thinking About Money Mess You Up
# 76 - Luck Can Take You To The Top But It Won't Keep You There

 

I hope you enjoy them.

***Note: This site works best when you read the posts in order. So please head to the ARCHIVE to get started.