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Reciprocation = Trading not Transactions

Mon, 11 Mar 2024 19:41:30 GMT

Reciprocation is not transactional.

"I do you a favour so you owe me one in return."

That is not the right way to see it.

People often tell you that reciprocation is transactional - Favours granted versus favours owed. That is wrong. It is a much more fundamental human condition than that.

It is more like - 'I do "business" with this person, therefore they are a valuable part of my network.

Therefore this is a trading relationship, it is something which I will gain from. I need to invest in it.'

This is an ancient and deep seated driver in the social human animal. In every circumstance people need people to divide labour and exploit different skills and resources to their advantage and the greater good. We have evolved to be trading animals and you might argue that is the most important instinct that humans have. The division of labour built the world we live in and the foundation of this division is trading, goods, knowledge, and reputations.

If you are finding it difficult to establish a relationship with a client a boss, or a colleague you might be advised to give them something so that they feel obliged to you. However, if you give them something you are at best only offering a relationship. Even if they accept it the level of obligation on them is minor.

Tributes and charity are not trading.

To explain the problem with these transactional relationships, this think of a Queen and a Beggar. If the Queen gives something to the beggar, it is charity. The beggar has no obligation to return the favour - a simple thank you will do. There is no trading relationship. If the beggar gives something to the Queen this is just a tribute. It is a recognition of the higher status and power balance in the relationship. Any thanks from the Queen is just to say 'I acknowledge your lower status and I'm pleased that you understand your place."

In corporate life the ticket to a sporting event given to a Client is generally a tribute . A public mention of the efforts of a junior is charity . Polite people will say 'thanks' but they don't have a relationship. It is nice, but it is not very powerful.

It is the exchange of favours or goods that make the relationship become reciprocal, that make it a trading relationship.

If you get your target to give you something valuable, you are in a trading relationship. This is sealed when you give something in return.

How do you get away from the status signalling of tributes and charity to enter the realm of a trading relationship?

The first point to note is that if you get your target to give you something first you are almost there. If you are the first to give something you need to be sure of receiving something in return - that is closely related, and equally valuable to what you have given. You need to ensure what you receive is not charity - from a higher status target, or a tribute - from someone junior to you.

The combination of these four steps in this sequence will establish a real trading relationship:

Attention/listening (recognising what the target chooses to value),
Complimenting (expressing respect for these choices),
Receiving (asking the target to give you something)
Returning (giving something valuable in return)

Steps 1 to 3 will pretty much guarantee that you have established a trading relationship. Step four just seals the deal and confirms your target's decision that you are a valuable trading partner.

An nice example of this is Benjamin Franklin, who won over a political opponent who constantly spoke against him by careful research and subtle trading. He realised that his opponent was very proud of his library and chose a rare book that he possessed. He then approached his target with a compliment on his reputation for learning and on the breadth and depth of his personal collection of books. He asked if he could borrow a specific book which was of great interest to him. The opponent was keen to acknowledge and lent Benjamin Franklin the book. From that point on the opponent become civil and supportive.

Franklin noted that he had not returned the favour before the relationship had changed. It changed when the target began trading.

So, where the relationship matters to you, get outside the give-and-take of transactional relationships and get into a real reciprocal relationship - a trading relationship.

Why the Narrative Policy Framework is great for persuasion

Thu, 04 Jan 2024 16:03:21 GMT

Why the Narrative Policy Framework is great for persausion

Sam was having a communications problem. Despite presenting a logical and complete case for a new marketing strategy, the board was not persuaded. Sam had explained the full picture, setting out the relevant characteristics of a market they were all familiar with, and then filling in the gaps to show how packaging products and services into one offer would work better. There would be a small but positive impact on sales volumes but a much bigger impact on profits. This would also require a reorganisation of the operations teams. The board seems to understand all of the data and the projections, but the message was not landing. Somehow the facts on their own were not compelling. It was time for a new approach.

Sam had recently learned about a persuasion technique called NPF which stood for “Narrative something Framework” but meant essentially persuading using carefully designed stories. It had to be worth a try.

The narrative framework approach suggested dividing the task of persuasion into two stages: first change the audience’s world view, then engage them to make them act. Here are the two stories Sam told the board.

There are people in this company who make a good living earning commissions from selling our products, and others who sell our services to earn their bonuses. These people cooperate pretty well, sharing details of customer needs and contacts details. We recently ran a workshop with top performers from both teams to see how we could improve cooperation and customer experience. Everyone in the room agreed that some of our competitors – in particular EnemyCo and ChallengerCo – have started working together to package services and products into one offer. Customers are taking interest, and we are losing sales. They like the soup-to-nuts character of the combined package. They also like the single procurement cycle of buying services to match each product from the start. The workshop attendees all agreed that because we deliver both products and services we could exploit this developing industry trend. A good idea from the team in the field who know our customers. It makes perfect sense.

However, over lunch after the workshop, Jo Bloggs – one of our top services sales guys – told me that this great idea had a very personal downside. Though the combination was a great idea and had been fairly obvious to the field ops team for some time, the company structure acted as a barrier to cooperation between teams. The commissions and bonus structures for product and service sales are different. Up-front revenues from product orders are where the product team make their money. For the service guys repeat revenues are the key. They are incentivised to sell separately to maximise their earnings. Nobody on either side wanted to sell packages and lose most of their bonus to the other guy.

Once Sam shared these stories the board demanded data to establish the size of the opportunity and a plan to effect the required organisation and incentives changes. Fortunately, Sam had the information ready to close these knowledge gaps and turn this energy into action.

Sam was persuaded too, from now on the NPF approach will be their default. Engagement changes minds better than cold hard facts.

This is how you might sell NPF using an NPF approach. Compare this to the previous post which promotes the NPF using the KDM structure.

NPF Vs KDM. I’ll be very interested to hear your feedback.

Using the Knowledge Deficit Model to sell the benefits of the Narrative Policy Framework

Wed, 03 Jan 2024 14:06:26 GMT

Using the Knowledge Deficit Model to sell the benefits of the Narrative Policy Framework

When we want to persuade, or we are being persuaded, we are used to seeing the Knowledge Deficit Model (KDM) applied. This approach assumes that providing people with full information will lead them to change their minds - and that does work.

There is an alternate way – the Narrative Policy Framework (NPF) which is frequently proven to be more effective than KDM.

NPF is designed to help policymakers and advocates use narratives more effectively to communicate their messages. It was developed in the context of persuading the public to support government policies (the clue is in the name) but it has many applications when persuasion is your goal.

Stories can help to make complex issues more relatable and can evoke emotions that can influence people's decisions. Some important characteristics of NPF are:

NPF identifies four key elements of a narrative: setting, characters, plot, and moral. These elements work together to create a message that resonates with the audience.
NPF also recognizes the importance of congruence. A story is more likely to be persuasive if it is congruent with the audience's existing worldview.
NPF can be used to change worldviews and behaviour. However, it is important to note that these are two separate tasks, and it is often difficult to do both at the same time.
NPF emphasises the importance of empathy. In order to create effective narratives, it is essential to understand the point of view of the audience.
NPF acknowledges that evidence can come in many forms, not just scientific data. Anecdotes and personal stories can also be persuasive.
NPF divides evidence into five categories: scientific findings, statistics, polls, legal evidence, and ipso dictum (appeals to authority).

You might think, is that a bit obvious, stories are more persuasive than lists of facts? But it is very easy to slip into the mode of “if only they knew about X they would understand and act”. The next time your persuasive powers are failing you, step back and try creating the right story instead.

One last note. This post uses the KDM structure to persuade you to try NPF. The next one will sell NPF using an NPF structure. I’ll be interested to hear your feedback on the pros and cons of the two approaches.

Why Doublethink is good for you.

Fri, 09 Jun 2023 12:36:30 GMT

Why George Orwell (who was a genius) got doublethink wrong

Doubt and Doublethink

To be good at thinking we need accept that any valid answer might still be wrong. At the same time, we must act as if the current answer is correct. In the book “1984” George Orwell called this ‘doublethink’ and said it was to be avoided. In reality, it is very commonplace and essential.

A little bit of science will tell us that a page is made up of atoms, a complex collection of vibrating particles, and has more space than mass. However, we can deal with it effectively as one simple object. The world is full of such ambiguity.

We conceive of money as a physical thing with a reliable value. In reality it is a social contract with a solid value that is based on nothing more than belief and trust.
We think of ‘WiFi’ as internet connectivity to mostly free stuff. Really it is one step in a chain of capabilities, both technical and commercial, which are integrated by written and unwritten agreements between millions of people to give us access to information which in turn is gathered and presented by means of another complicated web of co-operation and co-dependencies.
We think of ourselves as an individual thinking creature. At the same time as we can zoom out to see ourselves as one element in a social whole of family, of nation, or of humanity. If we zoom in, we are only about 50% human. The other 50% of our cells is made up of bacteria and microbes. I am a system, not an individual, the total genes in my bugs’ genomes amount to perhaps 100 times the number in my human genome.

To keep it simple I am pragmatic, I might feed my bugs with pro-biotic yoghurt, and pay my taxes for the sake of the nation, but I will still act and decide on the basis there is only one of me and I get to decide things.

“The test of a first-rate intelligence is the ability to hold two opposed ideas

in the mind at the same time, and still retain the ability to function.”

F. Scott Fitzgerald - Author.

This double-thinking ability goes un-noticed but it is one of the many ways we pragmatically get through the complexity of life. Just like breathing, it can seem a little odd if you focus your attention on it. When we start to examine our thinking processes this uncertainty becomes evident. Thinking is simultaneously made up of complicated collections of thinking patterns, and is a single process that support the decisions that we make and the actions that follow.

The double-thinking sensation can be exhilarating or stressful, or it may alternate between the two (psychologists call it ‘cognitive dissonance’). The reaction varies with the individual and with the context. The reason why people respond in different ways to this dissonance is a whole new subject for another day.

Bottom line: The capacity to consciously process our, usually invisible, double-thinking is necessary for good thinking. It requires us to be pragmatic as well as both reasonable and rational. The good news is we do this double-thinking already, and we do it a lot. The truth is that we just need to become aware of this ability and focus on it until we understand it well enough to be able to forget it again. A bit like working on your golf swing or learning to play the piano.

It turns out Dunning-Kruger is wrong. People who are less smart aren’t more arrogant than the smart folks.

Thu, 25 May 2023 14:49:00 GMT

New evidence shows that Confirmation Bias and poor statistics delivered a very popular “scientifically proven” insight – that was dead wrong.

The Dunning-Kruger Effect says:

The more intelligent a person is, the more likely they are to be humble about their abilities. Conversely, individuals with lower intelligence tend to overestimate their own intelligence.

This has an instant appeal, and it has been very popular since the original paper was published in 1999. The experiment has often been re-run and validated. But it is bunkum.

The Dunning-Kruger experiment asked people to sit a logic test then asked them:

i) How many Qs do you think you got right? and

ii) How do you think you did compared to the others taking the test?

Generally both high and low performers were pretty good when answering question one. But for question two both the lowest performers and the highest performers guessed that they were above average. This overconfidence is a very common and well recognised human failing, Most people who drive (93%) think they are above average drivers. Most teachers (90%) think they are more skilled that other teachers. But the Dunning-Kruger Effect appeared to show that this overconfidence was stronger in the lower performers.

Many other psychologists using the same approach re-ran the experiment and confirmed its success. In good faith, they all missed the same built-in design error. As a result, it is very widely believed to be true and has entered popular thinking.

However, a 2023 study by the mathematician EC Gaze discovered that the existence of the Dunning-Kruger Effect is not backed up by the experimental data. The effect is simply a statistical anomaly, an artifact of research design.

Gaze did this by recreating the experiment but with randomly generated results. With random test scores and comparisons to others assigned to all the participants, the Dunning-Kruger Effect was still there in the outcomes.

The problem is obvious. Well, it is now that someone has pointed it out!

Full disclosure: I cheerfully referred to the Dunning-Kruger Effect in my book ‘Good Thinking & Bad’ published in 2019. I’m in the process of putting an update in the Kindle version.

The people with lower ability scores mark themselves as a bit above average. The higher scoring people also rank themselves as a little above average. Because they have more headroom, the lower scores have a bigger gap between their ‘I’m a bit above average’ and their actual score. Therefore, it appears that they are more boastful. If a random allocation of test scores and ratings produces exactly the same result, it is clearly not down to lower scorers having delusions of grandeur. It is a flaw in the experiment design.

Another study by Prof Edward B Nufher in 2016 confirmed that lower ability participants are actually quite good at assessing their own results. To be fair, the Dunning-Kruger experiment showed the same, and they said so. It’s just that the missed the point that all the participants assume everyone performs at about the same level as they do, and they all think that they are a bit better than average.

It's a classic case of confirmation bias delivering bad science. It is a very appealing idea that ‘less smart people are not smart enough to realise that they are not that smart’. It’s especially if you also know that you have above average intelligence ��.

Like everyone else I didn’t spot the flaw in the Dunning-Kruger effect. In my defence I do feature in my book a similar oversight caused by confirmation Bias that led the Bill Gates Foundation to waste a lot of money promoting the idea that small schools are higher performers. (Spoiler alert – they are not. It is just another lies, damn lies, and statistics thing).

That means I must be smarter than the average author of popular science books! I'm right? Yeah?

References:

A good article by Fortune Magazine that points this out.

The original 1999 Paper by Kruger J., and Dunning D .,

Experiment by Ed Nufher March 2016 showing people are good at assessing theor own capabilities

How to be Lucky - the Scientific Approach

Sun, 21 May 2023 17:40:43 GMT

There is a simple and scientifically proven way to increase your luck. That's lucky!

Everybody needs a bit of luck, I found understanding the science behind luck made me realise what I do naturally makes me a pretty lucky person. Knowing exactly what to focus on when I need a lucky break helps. I hope it will help you too.

Is there science behind luck? Experiments by Prof Richard Wiseman suggest that there are four behaviours which are common to people who see themselves as lucky.

People who do these things have a bit more luck than average.

They are Alert : They keep their eyes open for lucky opportunities, and always expect to find them.
Luck is the intersection of preparation and opportunity. Be prepared by developing your skills, staying informed, and keeping your options open.
Don't limit yourself by preconceived notions of what you can or cannot do.
Stay flexible and open to new opportunities, even if they don't fit your original plans.
They Bounce Back : They are resilient. They know that bad stuff does happen, but they look for a bright side.
Luck rarely comes to those who give up easily. Accept that there will be some setbacks. Be persistent and keep working towards your goals, even in the face of obstacles.
They trust their Intuition : Faced with a decision, they relax and listen to their gut.
Luck often favours those who take risks, but it's important to take calculated risks. Consider the potential rewards and weigh them against the potential risks – then trust your instinct.
They Think Positively : They imagine good stuff happening, because that makes it more likely.
Positive energy attracts positive results. Surround yourself with people who have a positive outlook on life, and who support and encourage each other.
Be kind and generous, and express gratitude for what you have. This will put you front of mind for anyone who has a something to give.

So being lucky is not just a matter of chance. If you can; be prepared and flexible, take some risks and accept a few failures, and adopt a positive mindset, you can increase your odds of being lucky. I'm lucky that these behaviours are quite natural to me, and I have had a lucky life. But it is good to remember to focus and to make sure that your reactions to life's ebb and flow is designed to give you the best outcomes.

Try these behaviours for A BIT and you shouldn’t be surprised at how lucky you become.

Good luck!

Ref: The Luck Factor by R Wisemann, The Skeptical Inquirer Volume 27, No.3 ~ May/June 2003