Categories
Uncategorized

When a quarter and dime are the same size.

Collect a quarter, a dime, a notecard, and a pen. Trace the dime with the pen on the notecard. Press and repeat to the point where the ink softens the paper and the circle easily pushes out.

Make extra for the neighborhood kids – and the neighbors who are kids at heart.

You’re reading this and I’m writing this so we both know there’s a catch. But like with comedy, we’re here for those moments.

It seems like the quarter won’t fit because it’s larger. But what does that mean? There’s two approaches. 

  • The quarter’s diameter is larger than the dime’s diameter.
  • The quarter’s circumference is larger than the dime’s circumference.

But we can change the framing and get the larger quarter through the dime size hole.

  • The quarter’s diameter is NOT larger than the dime’s circumference.

One of the largest lessons from Herbert Simon’s Confessions of a Pricing Man was that all value is perceived value. The starkest way to understand this is to think of the expression, you couldn’t pay me to. For example, you couldn’t pay me to sit outside on a hot Florida Saturday surrounded by tens-of-thousands-of-other people watching a game I don’t understand or care about

Yet people pay good, and sometimes a lot, of money to watch college football.

In a literal sense this expression doesn’t work so well but in a figurative sense it shows that all value is perceived value—and that all perception is malleable. As Rory Sutherland said, “you can always use a bit of psychology to make products better.” 

People don’t like investing in stocks when the numbers are red. People do like red painkillers, believing they work better. And half of all Ferrari’s are, you guessed it, one color

Framing things in a new way is how we make the impossible easy. 

Want more? Check out this pay-what-you-want placebo prescription pdf.

Categories
Uncategorized

A New POV

A new perspective can be invaluable. One expression is that a change in point-of-view is worth forty IQ.

In her Masters in Business podcast with Barry Ritholtz, Barbara Tversky highlighted research about design and creativity. She said:

“In order to design we have to get rid of old ways and think in new ways. We just finished an experiment asking people to think of new ways to use old things. The good answers come at about the ninth answer. The way we got people to generate these new ideas—how to use an umbrella in a creative way—was to ask them to think of differing roles of people. How would a doctor use this? How would a gardener?”

Barbara Tversky

Host Barry Ritholtz said it reminded him of the props portion of Whose Line is it Anyway.

A new perspective tends to help because it’s a new way to look at an issue. Even though we may be well versed in an area, we also may be on a blocked trail. Our familiarity with one path could be our hinderance.

When Bill Gates was asked why he could contribute to something like polio research, besides just dollars, he said that sunk costs and biases seep in along with the work. Instead there has to be an outside perspective that asks, have you considered this?

Part of the reason comedy, like Whose Line, works so well is because it offers a contrast from a different point of view. Ricky Gervais’s joke about guitar lessons is just that. He reframes Twitter into a physical message board. He reframes followers as passersby.

It’s great to hear about Tversky research because it provides a framework for how this can happen. Think of ten jobs, pretend you’re that person, come up with one answer for each. That’s it.

Other quotes from Tversky I liked:

  • “We have to learn routines to get through the day. If everything is a new problem it’s going to take too long.”
  • “Memories start getting distorted the minute you use language because they don’t happen in language.”