“What is it that Makes X Reasonable Behavior?”

Irrational and human

This post is part of a new series on conversations worthy of attention.

Human behavior is a fascinating and never-ending source of learning.

If you work in marketing, communications, brand strategy, public relations, advertising, and in general in trying to persuade people to do something — a fairly accurate definition of business in search of results — this is where you keep coming back. 

Economists have figured it out as well. There is no such thing as rational behavior — we rationalize after the fact.  

But we forget human nature in our haste to fit in with the spreadsheet crowd. Adman Rory Sutherland# says:

“The most dangerous technology of recent years has spread without a voice raised against it. I am talking about the spreadsheet.

What the spreadsheet has done is to create in organisations and governments an over-reliance on numbers (by no means always meaningful or even accurate) with the result that often spurious numerical targets, metrics or values invariably override any conflicting human judgment. 

This has given rise to what a colleague of mine, Anthony Tasgal, calls “The Arithmocracy”: a powerful left-brained administrative caste which attaches importance only to things which can be expressed in numerical terms or on a chart.

I object to the spreadsheet precisely because of the pseudo-science involved, and the way numbers create a semblance of mathematical rigour which lends some measures or extrapolations an influence they don’t deserve.

Einstein posted a sign in his office at Princeton which read, “Not everything that counts can be counted, and not everything that can be counted counts.” In spreadsheet-land everyone knows educational standards are falling — but “that’s fine because the pass rate is going up.” 

Bankers have instinctively known for years that something was wrong — but 1,000 screens twinkling with reassuring numbers have vetoed anyone from acting on their instincts.

We worry endlessly about how technology might give rein to our baser urges but give no thought at all to the dangers of excessive logic. Yet the Holocaust and the Soviet famine were both the product of meticulous government officials in dutiful pursuit of numerical targets.

Italians, by and large, don’t go in for atrocities. It’s not mass hysteria that really frightens me, it’s mass rationality.”

Italians, by and large, embrace human nature — this might explain a global rise in our collective love for the “Bel Paese,” where we can put life back into lifestyle. How can a country that has a crippling bureaucracy and has chronic problems with diversity be so diverse and enjoyable?

Some ideas don't make sense. We do well when we accept that and work our way to understanding “what is it that makes X reasonable behavior?” in the words of Ole Peters#, Fellow and PI, Engodicity Economics. The question asked this way leads to insights about the decision-maker’s situation.

People place higher value on things they already own, and that includes ideas. 

But we can predict behavior (to a certain extent). Thaler was awarded the Nobel Prize for his work based on this insight. He coined the term “nudging” to describe the small interventions we can create to lead people in the direction we want them to go.

The entire field of advertising and brand messaging owes its success to this simple fact — that pure efficiency is over-rated. We're not driven by perfect rationality, perfect trust, and perfect information. What makes us unique and interesting is our edge.

Nudging works at scale as well. One only has to look at algorithms. They're reprogramming us precisely because they're able to engineer small nudges frequently enough to create habits. Machines exploit our biased human nature, not our ability to think rationally.

It's the observation of what makes a behavior reasonable that leads to insights, not the precise measurement of what people do. 

Vitalik Buterin and economist Tyler Cohen talked# about travel literally, but this thinking applies to the type of research we do as strategists:

I think the kind of traveling that is valuable is the kind where it’s not even set up as explicit travel for the sake of travel. You’re traveling there in order to do something, and in the course of doing that, you end up interacting with people.

You end up seeing what the different aspects of the culture look like. You end up seeing how people think, how people interact with each other.

Buterin works at the intersection of programming, economics, cryptography, distributed systems, information theory, and math to synthesize insights across those fields into successful, real-world applications like Ethereum, which aims to decentralize the Internet.

If you just want to find out what something looks like or where it is, then by all means open up a search box and look at the photos and description. You can put all of it in a spreadsheet, including how tall it is how much it weighs, and how many people go there.

But if you want to understand what attracts them, how something affects people, then you've got to be there, watch them interact with it, and listen to their stories. Online we have the illusion of knowing why people do what they do just because we can track it (and prompt it). Good prompting starts with a good understanding of human behavior, not the other way around.

We worship spreadsheets and data and under-rate the importance and value of connecting with the right people. Human connection is a strong signal. I would have never learned of the best place to eat in Genova, Italy, had I not stopped for artisanal gelato and met Martina.

What we worship ends up occupying our mind, until we see nothing else.

In a recent conversation with a family physician I learned that we fall because we break the femur#, we don't break the femur because we fall (when femur is involved in older age). The two are correlated, but get causation wrong, and you miss* important clues. World-changing ideas live there.


* We do love explaining how something went after the fact. Why would we admit to be old and frail? It was the fall that did it! Maybe.

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