Abstract
When I read Cicero’s aforesaid statements, I felt that he could think clearly. Would it be an exaggeration to say that if all human beings could think clearly, then there would have been lesser problems in this world and the world would have witnessed a reduction in the number of cataclysms? Or would there have been sundry more problems? My experience in life only proves, ascertains and upholds (but never disproves) the age-old Murphy’s laws: New systems generate new problems; If there is a possibility of several things going wrong, the one that will cause the most damage will be the one to go wrong; Communication usually fails, except by accident; If a message can be interpreted in several ways, it will be interpreted in a manner that maximises the damage; and If you perceive that there are four possible ways in which something can go wrong, and circumvent these, then a fifth way, unprepared for, will promptly develop. The problems that human beings might have encountered yesterday or today were/are definitely not the last (against all hopes). Reading newspapers on a daily basis will assure us that most of the projects have not been completed in the stipulated time and cost frame. Nonetheless, there is no harm if human beings can develop the prowess of clear and correct thinking and decision-making.
Are there any secrets of perfect decision-making? Why is the sunk cost fallacy also referred to as the Concorde effect? Can the act of donating act as a camouflage for corrupt practices? Is Google successful because it nurtures a culture of creativity? Why is hindsight bias perilous and can we do something about it? Is the effect of overconfidence more pronounced in men compared to women? Can performance-related incentives result in desired performance and enhanced productivity or rather do they trammel both? Is there a recipe for being successful in life? Why do people break rules? Is there any secret that can ensure the success of multilevel marketing? Why do people collect matchboxes, stamps, coins and vintage cars even when they might serve no practical purpose (the old matchbox does not have matchsticks, the used and old stamps are unacceptable at the post offices—more and more people are using emails and faxes anyway, banks are not interested in old coins and the vintage cars cannot be used on roads—one should read the Central Motor Vehicles Act 1988)? Do the past grades of a student influence his/her evaluation by the professor? Does the fear of losing something motivate people more than the prospect of gaining something of equal value? Do teams really achieve more than individual workers (one ought to study ‘Ringelmann effect’ which states that individuals in fact slacken when working in groups)? Can the time of delivery of a verdict, for the same case, by the same judge on the same day (only the timings are different) influence the verdict in some way? Is there any difference between envy and jealousy? Through 99 short but enthralling chapters and an epilogue, each chapter running into three to four pages at the most, the work under review provides eye-opening answers to the aforesaid queries.
The first chapter contains two very interesting statements ‘A stock index is not indicative of a country’s economy’ and ‘…(false) studies immediately attain a high degree of popularity and attention’, which have also been proved in the chapter itself. Although the reader may initially question the veracity of the aforementioned statements, by the end of the chapter the reader will find the statements to be veritably true. The third chapter exposes the dangers of finding patterns where no patterns actually exist and underlines the significance of mathematical tests. The fourth chapter unmasks the evil behind bubbles and stock market panic. The seventh and the eighth chapters dwell on confirmation bias that is the mother of all misconceptions and fallacies. The 35th chapter dwells on the concept of ‘Winner’s Curse’, which explains why the winner in an auction might actually become a loser! Through brilliant examples, the 37th chapter explains that correlation is not causality. The 57th chapter explains how reams of words can be used to camouflage cerebral indolence, dullness or uncultivated ideas. The 76th chapter speaks of a finance expert who could not apply an ingenious process he had painstakingly devised (for which he was honoured with the Nobel Prize) to his own affairs! The 85th chapter explains that a person’s willpower is like a battery. It can be charged and it can be drained and it can be transformed into a bigger battery. The 95th chapter dwells on a type of research that has not attracted a Nobel Prize hitherto.
The author of the work under review has built on the experiments conducted by noted psychologists such as Solomon Asch (several authors have included S. E. Asch’s experiment, referred to herein, in their books, for instance it can be found on page 417 of Management: A Global, Innovative, and Entrepreneurial Perspective, fourteenth edition, authored by Weihrich, Cannice, Koontz), Stanley Milgram (widely acclaimed for his controversial study on obedience to authority figures), Barry Schwartz (author of Paradox of Choice), Amos Tversky (regarded as one of the world’s most leading experts in judgement and human decision making), Nassim Taleb (author of Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets, which was selected by Fortune as one of the 75 ‘Smartest Books of All Time’), Edward Lee Thorndike (widely acclaimed for his work on comparative psychology and learning process), Daniel Kahneman (Nobel Laureate) and several people of their ilk.
It would do the prospective reader a great deal of good if he/she apprises himself/herself with terms such as exchange-traded funds, hedge funds, portfolio selection, equity and triple-bogey as these terms have been used without much explanation in the book.
Rolf Dobelli has clearly identified the sundry biases and cognitive processes that might affect a human being’s thinking process. It dissects the role played by experiences, circumstances, external factors, fiascos and explains how they influence a person’s thinking pattern(s). It contains information that will help remove the obstacles to creative thinking. Rolf Dobelli has provided cross references throughout the book, which will definitely help the reader in interrelating, differentiating, integrating and assimilating the concepts covered in the book. It contains effective and novel tips for salespersons, consumers, producers and other intermediaries in supply-chain and logistics management. It finely lists numerous experiments and several management games. The book dwells on several novel and interesting concepts such as survivorship bias, liking bias, endowment effect, zero-risk bias, scarcity error, Romeo and Juliet effect, base-rate neglect, gambler’s fallacy, social loafing, fundamental attribution error, hyperbolic discounting, affect heuristic and Zeigarnik effect. The book will be of great help to the champions of organisational behaviour, marketing management, research, sales, operations research, strategic management and anyone who wants to comprehend the fallibility of human knowledge and obtain insights into the dreadful game of life! The tome under review is definitely worth much more than its maximum retail price (MRP).
[An afterthought: A few days ago, I attended a faculty development programme at a premier institute. All the 19 FDP participants found the programme to be highly enlightening. The truth is that whatever was discussed by the faculty who coordinated the programme, including the experiments that were conducted, the games that were played, management concepts, etc., has all been discussed in an elaborate manner in the work under review. I had paid ₹21,910 only for the five-day FDP. The price of the magnum opus under review is ₹350 only! (mentioned in the rubric of this review). Assuming that it might take five minutes for a person with normal reading capability to read one page of the work being considered herein, the book can be completed in around 1,680 minutes. Which implies that a person (referred to in the preceding statement) should be able to read the book in circa four days assuming he devotes eight hours per day to the book.]