Clear Thinking: Turning Ordinary Moments into Extraordinary Results - by Shane Parrish
Date read: 2023-10-11How strongly I recommend it: 10/10
(See my list of 150+ books, for more.)
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From the founder of Farnam Street and creator of The Knowledge Project Podcast comes one of the best books I've ever read on how to make better decisions. Extremely well-organized and thorough - a quick read packed with great advice that you can action on quickly. Recommended for anyone looking to improve their critical thinking skills.
Contents:
- THE ENEMIES OF CLEAR THINKING
- BUILDING STRENGTH
- MANAGING WEAKNESS
- DECISIONS: CLEAR THINKING IN ACTION
- WANTING WHAT MATTERS
My Notes
While the rest of us are chasing victory, the best in the world know they must avoid losing before they can win. It turns out this is a surprisingly effective strategy.
In order to get the results we desire, we must do two things. We must first create the space to reason in our thoughts, feelings, and actions; and second, we must deliberately use that space to think clearly. Once you have mastered this skill, you will find you have an unstoppable advantage.
A good position allows you to think clearly rather than be forced by circumstances into a decision.
You don't need to be smarter than others to outperform them if you can out-position them. Anyone looks like a genius when they're in a good position, and even the smartest person looks like an idiot when they're in a bad one.
Clear thinking is the key to proper positioning, which is what allows you to master your circumstances rather than be mastered by them.
We are naturally prone to defend our territory.
Our identity is part of our territory too. When someone criticizes our work, status, or how we see ourselves, we instinctively shut down or defend ourselves. When someone challenges our beliefs, we stop listening and go on the attack.
We're naturally wired to organize the world into a hierarchy. We do this to help make sense of the world, maintain our beliefs, and generally feel better. But when someone infringes on our place in the world and our understanding of how it works, we react without thinking.
We're self-preserving. When we're triggered and not thinking, our desire to protect ourselves first takes over. When layoffs loom at a company, otherwise decent people will quickly throw each other under the bus to keep a job.
Our primal defaults:
Not all confidence is created equally. Sometimes, it comes from a track record of applying deep knowledge successfully, and other times it comes from the shallowness of reading an article.
If you find yourself expending tremendous energy on how you are seen, if you often feel your pride being wounded, if you find yourself reading an article or two on a subject and thinking you're an expert, if you always try to prove you're right and have difficulty admitting mistakes, if you have a hard time saying "I don't know," or if you're frequently envious of others or feel as though you're never given the recognition you deserve-be on guard! Your ego is in charge.
Success requires shamelessness. So too does failure.
Doing something different means you might underperform, but it also means you might change the game entirely. If you do what everyone else does, you'll get the same results that everyone else gets. Best practices aren't always the best. By definition, they're average.
Change happens only when you're willing to think independently, when you do what nobody else is doing, and risk looking like a fool because of it. Once you realize you've been doing what everyone else is doing-and only because they're already doing it-it's time to try something new.
If you find yourself exerting energy to fit in with a crowd, if you're frequently fearful of disappointing other people, if you're afraid of being an outsider, or if the threat of scorn fills you with dread, then beware! The social default is in charge.
If you find yourself biting your tongue in group situations, if you find yourself or your team resisting change or continuing to do something in one way simply because that's how you've always done it in the past-be on your guard! The inertia default is likely at work.
The people with the best defaults are typically the ones with the best environment.
The way to improve your defaults isn't by willpower but by creating an intentional environment where your desired behavior becomes the default behavior.
Here are four key strengths you'll need:
Champions don't create the standards of excellence. The standards of excellence create champions.
There is always something you can do in the moment today to better your position tomorrow. You might not be able to solve the problem, but your next action will make the situation better or worse. There is always an action you can control, however tiny, that helps you achieve progress.
Kind people will tell you things a nice person will not. A kind person will tell you that you have spinach on your teeth. A nice person won't because it's uncomfortable. A kind person will tell us what holds us back even when it's uncomfortable. A nice person avoids giving us critical feedback because they're worried about hurting our feelings.
One of the most common mistakes people make is bargaining with how the world should work instead of accepting how it does work. Anytime you find yourself or your colleagues complaining "that's not right," or "that's not fair," or "it shouldn't be that way," you're bargaining, not accepting. You want the world to work in a way that it doesn't.
One effective question to ask yourself before you act is, "Will this action make the future easier or harder?"
The things you choose not to do often matter as much as the things you choose to do. The real test of a person is the degree to which they are willing to nonconform to do the right thing.
If you want to better understand your level of self-knowledge, ask yourself how many times a day you utter the phrase "I don't know." If you never say, "I don't know," you're probably dismissing things that surprise you or explaining away outcomes instead of understanding them.
"When you play games where other people have the aptitude and you don't, you're going to lose. You have to figure out where you have an edge and stick to it." -Charlie Munger
It's not enough to know where you have an edge; you also have to know when you are operating outside of it. If you don't know which side of the line you're on, or that there even is a line at all, you're outside your boundaries.
Emotional intensity is far less important in the long run than disciplined consistency. Inspiration and excitement might get you going, but persistence and routine are what keep you going until you reach your goals.
The most important voice to listen to is the one that reminds you of all that you've accomplished in the past. And while you might not have done this particular thing before, you can figure it out.
When hiring employess: "If you could pick one trait that would predict how someone would turn out, what would it be?" "That's easy," he said. "How willing they are to change their mind about what they think they know."
Admitting you're wrong isn't a sign of weakness, it's a sign of strength. Admitting that someone has a better explanation than you shows that you're adaptable. Facing reality takes courage.
I remembered a story I'd read about Henry Kissinger. A staffer had drafted a memo and left it on Kissinger's desk for him to read. A while later Kissinger approached him and asked if it was his best work. The staffer said no and rewrote the entire memo. The next day the staffer ran into Kissinger again and asked what he thought. Kissinger asked him again if this was the best he could do. The staffer took the memo and rewrote it yet again. The next morning the same scenario played out, only this time the poor staffer stated that yes indeed it was his best work. Kissinger replied, "Okay, now I'll read it."
If you do what everyone else does, you can expect the same results that everyone else gets. If you want different results, you need to raise the bar.
There are two components to building strength by raising the bar: (a) Choose the right exemplars-ones that raise your standards. Exemplars can be people you work with, people you admire, or even people who lived long ago. It doesn't matter. What matters is they make you better in a certain area, like a skill, trait, or value. (b) Practice imitating them in certain ways. Create space in the moment to reflect on what they'd do in your position, and then act accordingly.
"Happy is he who can improve others not just when he is in their presence, but even when he is in their thoughts!" -Seneca
One way of creating space for reason in your thinking is to ask yourself what your exemplars would do if they were in your position.
The formula for failure is a few small errors consistently repeated. Just because the results aren't immediately felt doesn't mean consequences aren't coming. You are smart enough to know the potential results; you just don't necessarily realize when they're coming. While good choices repeated make time your friend, bad ones make it your enemy.
There is a gap in our thinking that comes from believing that the way we see the world is the way the world really works. It's only when we change our perspective-when we look at the situation through the eyes of other people-that we realize what we're missing. We begin to appreciate our own blind spots and see what we've been missing.
Safeguards are tools for protecting ourselves from ourselves-from weaknesses that we don't have the strength to overcome. For example, purging your home of all junk food is a safeguard:
If you got some results you didn't want, the world is telling you at least one of two things: (a) you were unlucky; (b) your ideas about how things work were wrong. If you were unlucky, trying again with the same approach should lead to a different outcome. When you repeatedly don't get the outcomes you want, though, the world is telling you to update your understanding.
Alcoholics Anonymous has a helpful safeguard for its members. They call it HALT-an acronym that stands for Hungry, Angry, Lonely, and Tired.
You can use the principles behind HALT as a safeguard for decision-making in general. If you have an important decision to make, ask yourself: "Am I hungry? If the answer is yes to any of these questions, avoid making the decision if you can. Wait for a more opportune time. Otherwise, your defaults will take over.
Why not bypass individual choices altogether and create an automatic behavior-a rule-that requires no decision-making in the moment and that gets no pushback from others?
For example, "I only drink soda at dinner on Friday," or maybe, "I don't drink soda at all." Having a rule means not having to decide at every meal. The execution path is short, and less error prone.
People question decisions, but they respect rules.
The way I did this was to imagine a film crew following me around documenting how successful I was. Regardless of whether I was a success or not, how would I act to show someone I deserved my success? What would I want them to see? What am I doing that I would want them not to see because I'm embarrassed or ashamed?
You might have a packing checklist every time you travel. In each of these cases, the checklist acts as a safeguard, forcing us to slow down whatever we're doing and go back to basics: "What am I trying to accomplish? And what are the things I need to accomplish it?"
Whenever he discussed something with anyone at work, he would start by offering his impressions of how the other person saw things. Then he would ask, "What did I miss?"
When the other person is done answering that first question, my friend still doesn't offer his own thoughts right away. He first asks a follow-up: "What else did I miss?"
The four steps to handling mistakes more effectively are as follows:
The most powerful story in the world is the one you tell yourself. That inner voice has the power to move you forward or anchor you to the past. Choose wisely.
The decider needs to define the problem. If you're not the one making the decision, you can suggest the problem that needs to be solved, but you don't get to define it. Only the person responsible for the outcome does.
Defining the problem starts with identifying two things: (1) what you want to achieve, and (2) what obstacles stand in the way of getting it.
Organizations and individuals waste a lot of time solving the wrong problems. It's so much easier to treat the symptoms than find the underlying disease, to put out fires rather than prevent them, or to simply punt things into the future.
The definition principle: Take responsibility for defining the problem. Don't let someone define it for you. Do the work to understand it. Don't use jargon to describe or explain it. the root cause principle: Identify the root cause of the problem. Don't be content with simply treating its symptoms.
A handy tool for identifying the root cause of a problem is to ask yourself, "What would have to be true for this problem not to exist in the first place?"
The best way to avoid finding the perfect solution to the wrong problem at work, when time allows, is to hold two separate meetings: one to define the problem, and one to come up with the solution.
One way to keep meetings short and avoid the signaling that comes from repeating information that everyone knows is simply asking everyone, "What do you know about this problem that other people in the room don't know?"
Remember that writing out the problem makes the invisible visible. Write down what you think the problem is, and then look at it the next day. If you find yourself using jargon in your description, it's a sign that you don't fully understand the problem. And if you don't understand it, you shouldn't be making a decision about it.
Use the test of time. Test whether you're addressing the root cause of a problem, rather than merely treating a symptom, by asking yourself whether it will stand the test of time. Will this solution fix the problem permanently, or will the problem return in the future? If it seems like the latter, then chances are you're only treating a symptom.
The Stockdale Paradox: "You must never confuse faith that you will prevail in the end-which you can never afford to lose-with the discipline to confront the most brutal facts of your current reality, whatever they might be."
Many people think they're bad problem solvers when in fact they're bad problem anticipators.
The bad outcome principle: Don't just imagine the ideal future outcome. Imagine the things that could go wrong and how you'll overcome them if they do.
The second-level thinking principle: Ask yourself, "And then what?"
You can't solve a problem optimally unless you consider not just whether it meets your short-term objectives but whether it meets your long-term objectives as well.
Some decisions might seem to come down to a choice between this or that, but there's often another option. The best decision-makers know this, and see binary thinking as a sign that we don't fully understand a problem-that we're trying to reduce the problem's dimensions before fully understanding them.
The 3+ principle: Force yourself to explore at least three possible solutions to a problem. If you find yourself considering only two options, force yourself to find at least one more.
Safeguard: Imagine that one of the options is off the table. Take each of the options you're considering, and one at a time, ask yourself, "What would I do if that were not possible?"
Safeguard: Come up with Both-And options. Try to find ways of combining the binary. Think not in terms of choosing either X or Y, but rather having both X and Y. For example, you can keep costs down and invest in a better customer experience. You can stay at your job and start a side hustle.
When we think of adding people to our lives, we start to open up Both-And options for ourselves. So instead of the usual relationship binary, "Should I stay or leave?" we start to say, "Whom else can I include in my life to help with everything beyond what my partner does well?"
The opportunity-cost principle: Consider what opportunities you're forgoing when you choose one option over another.
The 3-lens principle: View opportunity costs through these three lenses:
If you find yourself struggling to determine specific criteria, it's a sign either that you don't really understand the problem, or that you don't understand the general features that criteria are supposed to have.
If you're having trouble assessing opportunity costs, it sometimes helps to put a price on them. For example, putting a price on those extra two to three hours a day spent commuting will make them more visible and easier to assess.
Clarity: The criteria should be simple, clear, and free of any jargon. Ideally, you should be able to explain them to a twelve-year-old. Goal promotion: The criteria must favor only those options that achieve the desired goal. Decisiveness: The criteria must favor exactly one option; they can't result in a tie among several.
Example of creating a process for your team to make decisions:
When trying to allow your team to make their own decisions, ask yourself:
Until you do, your team will never make decisions without you. It's too risky for them to figure out the most important thing. Communicate that to your team, and they'll be able to make decisions on their own.
As long as they make a decision based on the most important thing, they won't be wrong. A lot of people reach their ceiling in this job because they can't figure out this one thing.
There is only one most important thing in every project, goal, and company. If you have two or more most important things, you're not thinking clearly.
The Criterion Battle:
The targeting principle: Know what you're looking for before you start sorting through the data.
Get high-fidelity (HiFi) information-information that's close to the source and unfiltered by other people's biases and interests.
Information is food for the mind. What you put in today shapes your solutions tomorrow. And just as you are responsible for the food that goes into your mouth, you are responsible for the information that goes into your mind. You can't be healthy if you feed yourself junk food every day, and you can't make good decisions if you're consuming low-quality information.
Safeguard: Run an experiment. Try something out to see what kinds of results it yields. For example, if you want to know whether people will pay for something, try to sell it before you even create it.
Safeguard: Evaluate the motivations and incentives of your sources. Remember that everyone sees things from a limited perspective.
It helps to think of each person's perspective as a lens onto the world. When you put their glasses on, you see what they see and have better insight into what they might be feeling. But those glasses have blind spots, often missing important information or confusing fact with opinion. By trying on all the glasses, you see what others miss.
Safeguard: When you get information from other people, ask questions that yield detailed answers. Don't ask people what they think; instead, ask them how they think:
Get high-expertise (HiEx) information, which comes both from people with a lot of knowledge and/or experience in a specific area, and from people with knowledge and experience in many areas.
When you want specific advice from an expert, look for someone who recently solved the problem you're trying to solve.
Here are five tips for approaching an expert for advice:
Safeguard: Take time to distinguish real experts from imitators. Not everyone who claims to be an expert is. Take the time to know the difference. Here are some things to look for:
Three Principles for Action:
These are some signs you've hit the limit of useful information you can gather:
A margin of safety is a buffer between what you expect to happen and what could happen. It's designed to save you when surprises are expensive.
The margin of safety is often sufficient when it can absorb double the worst-case scenario. So the baseline for a margin of safety is one that could withstand twice the amount of problems that would cause a crisis, or maintain twice the amount of resources needed to rebuild after a crisis.
Predicting the future is harder than it seems. Things are great until they're not. If things are good, a margin of safety seems like a waste. When things go wrong, though, you can't live without it. You need a margin of safety most at the very moment you start to think you don't.
I make major decisions and then sleep on them before telling anyone. Before going to bed, I would write a note to myself explaining why I'd made the decision. Doing so allowed me to make the invisible visible. When I woke up in the morning, I'd read the note. More often than I'd like to admit, my best thinking from the day before fell short upon inspection in the harsh light of the morning.
Fail-safe: Set up trip wires to determine in advance what you'll do when you hit a specific quantifiable time, amount, or circumstance.
Fail-safe: Use commander's intent to empower others to act and make decisions without you: Giving a team enough structure to carry out a mission but enough flexibility to respond to changing circumstances.
Commander's intent has four components: formulate, communicate, interpret, and implement. The first two components-formulate and communicate-are the responsibility of the senior commander. You must communicate the strategy, the rationale, and the operational limits to the team. Tell them not just what to do, but why to do it, how you arrived at your decision, so they understand the context, as well as the boundaries for effective action-what is completely off the table. Subordinate commanders then have the tools for the last two components: interpreting the changing contexts and implementing the strategy in those contexts
Before you begin executing a decision, just so there's no confusion as you move forward, ask yourself: Who needs to know my goals and the outcomes I'm working toward? Do they know what the most important objective is? Do they know the positive and negative signs to look for and what trip wires are attached to them?
If you can't be away, it doesn't mean that you're indispensable or a supremely competent leader; it means that you're an incompetent communicator.
Fail-safe: Tie your hands to keep your execution on track. Tying your hands amounts to different things in different contexts. If you're dieting, tying your hands might mean ridding your home of all junk food so there's nothing to tempt you. If you're investing, it might mean creating automated deposits each month.
The process principle: When you evaluate a decision, focus on the process you used to make the decision and not the outcome.
The transparency principle: Make your decision-making process as visible and open to scrutiny as possible.
Safeguard: Keep a record of your thoughts at the time you make the decision. Don't rely on your memory after the fact. Trying to recall what you knew and thought at the time you made the decision is a fool's game.
Acquiring Wisdom: It's more than knowing how to get what you want. It's also knowing which things are worth wanting-which things really matter.
Happiness is not a passive condition dependent on external events, nor is it the result of our personalities-just being born a happy person. Instead, happiness requires a conscious shift in outlook, in which one chooses-daily-optimism over pessimism, hope over despair.
"When you are distressed by an external thing, it's not the thing itself that troubles you, but only your judgment of it. And you can wipe this out at a moment's notice." -Marcus Aurelius
We regret the things we didn't do more than the things we did. The pain of trying and failing may be intense but at least it tends to be over rather quickly. The pain of failing to try, on the other hand, is less intense but never really goes away.
At some point my kids figured out that it was easier to solve a maze backward than forward, especially if the maze is harder or more complicated than usual. Something about starting with the end in mind, they realized, makes it easier to decide which path to take. Life in general works similarly.
If you want to develop good judgment, start by asking two questions: "What do I want in life? And is what I want actually worth wanting?" Until you've answered the second question, all the decision-making advice in the world isn't going to do you much good.