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  • The Blue Ocean Strategy Visual

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    Chris Wilson

    The business world is tough.

    There are hundreds of competitors out there who are all after the same customers that you are. If you are lucky you’re in a big market so there’s enough customers for everyone. Or perhaps you stand out by being better or cheaper than the rest. But there is another option, that’s the Blue ocean strategy.

    Avoid the red ocean, swim in the blue.

    “Don’t swim in a red ocean of bloody competition.”

    This is the core idea of the “blue ocean strategy”. Instead of fighting others for a limited set of resources, you move to a new market where there’s no competition at all. 

    Instead of being a choice of two or more, you become the only option. 

    Don’t look at the competition

    Country to most business strategies, you shouldn’t look at what your competition is doing in this strategy. That’s because if you define yourself properly, you have no competition. Plus, by looking at the competition, you can fall into the same traps.

    Instead, focus on your customers, their needs and how you can uniquely meet them.

    A blue ocean strategy doesn’t just mean premium pricing.

    You might think this naturally leads to premium pricing, but that’s not guaranteed.

    By redefining the market, the problem and the solution, companies can provide value at lower costs. An example might be providing a SaaS solution instead of a premium service (for example Canva for making social media images), instead of a freelance designer on commission, you can design it yourself.

    The Netflix example

    When it started, it was a way to watch movies at home. But it didn’t really compete with rental stores or cable services by offering a lower price or more options. Instead it provided a unique service of delivering dvd with credits each month. 

    Since then it changed to streaming with unlimited watching. 

    Are you swimming in a blue ocean?

    So if you’re competing in a vicious existing market, maybe you should look for the blue ocean? 

  • The misinformation effect: The cognitive bias that changes your memories of events. 

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    Chris Wilson

    There are a few moments in history when everyone can remember where they were.

    • The first moon landing
    • The Fall of the Berlin wall
    • The attack on the twin towers

    But your memory of these events may be less reliable than you think due to a cognitive bias.

    Introducing the misinformation effect

    The misinformation effect is when our memory is changed by what we hear and see after an event.

    E.g. a witness to a crime who remembers seeing something they couldn’t see.

    They remember it because they heard or saw something after the event

    Two groups watch a video of a car accident and were asked either:

    1. How fast were the cars going when they hit each other?
    2. How fast were the cars going when they smashed into each other?

    The 2nd group falsely remembered broken glass when asked a week [Loftus EF 1975].

    Misinformation isn’t always propaganda

    This isn’t always malicious.

    We might see video footage after an event from a different angle which then implants new information in our minds.

    Our memories then incorporate this information.

    But it can be abused by unsavoury actors.

    How propagandists use the Misinformation effect

    Propaganda can change our recollections of event we witnessed.

    The longer since the events and the more times a falsehood is told, the more likely we are to remember a false narrative.

    So how can we avoid the misinformation effect?

    A simple action to help limit the misinformation effect

    Recording your own recollection of an event as soon as possible provides a record of your immediate memories.

    You can use this to evaluate your later recollection and notice how it changes.

    But that’s not foolproof.

    When writing, you may add false data.

    Correction of false information can help to overwrite the implanted idea.

    This only works when the correct information is shared more often than the misinformation.

    This also does nothing for restoring your original memory.

    Summary

    Our recollections of events can be easily shaped by later information.

    It’s worse the more time passes and the more false information is shared.

    Journaling can limit these effects.

  • How the False Consensus Effect Messes with Your Predictions (And How to Manage It)

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    Chris Wilson

    Quick question: are most people like you, or different from you?

    Chances are you think most people are like you, but that may not be correct.

    Here’s why this happens and what can we do about it.

    Introducing the false consensus effect

    This bias is called the “False consensus effect”.

    It occurs because we tend to spend time with people (family and friends) who are like us. The problem is, that doesn’t mean EVERYONE is like us.

    This leads to us projecting our values on society and neglecting other views. 

    An election example

    The run up to elections are a great example of this effect.

    People are often shocked when their party doesn’t win because “everyone they know” supports their party. In some cases this is because their friend fail to share their real opinions. But it also happens because their sample is too limited. 

    If they spend more time with more diverse people, they would have a better picture.

    So what causes the false consensus effect?

    Theories on the cause of the false consensus effect

    There are lots of theories and factors that may explain the false consensus effect including

    • The desire to feel we belong in society (so we imagine society is like us)
    • A reliance on our bias experiences (we ignore other views)
    • Empathy is difficult (it’s easy to assume our own thoughts)
    • Anchored by our thoughts (Our initial ideas sway our view of others)

    And some factors seem to make the false consensus effect stronger.

    When we have particularly strong beliefs which we believe to be correct, we are more likely to over estimate their support [Morrison KR, Matthes J. 2011]

    This applies even when we don’t think they are the majority opinion.

    So how can we minimise the effect?

    How to manage the false consensus effect

    The two simplest ways to reduce the false consensus effect are

    1. Engage with other perspectives
    2. Check that your assumptions are correct.

    These help break our assumptions and introduce new viewpoints. 

    We can also reduce our motivations to be right which can help us accept other data. 

    Summary 👨‍🏫

    The false consensus effect says that we tend to believe others share the same beliefs as us even when they don’t.

    We can counter it by engaging with other perspectives and checking the consensus.

  • Why the Arrival Fallacy Stops You from Being Happy (And How to Avoid It)

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    Chris Wilson

    Was there a toy you really wanted as a kid? For me it was the Real Power Workshop. I eventually got one and it was great. But it wasn’t as good as I had imagined.

    This was due to the arrival fallacy, a common fallacy which can be avoided.

    Here’s what it is, and how to manage it.

    What is the arrival fallacy?

    The arrival fallacy is the idea that we will be happy when achieve some goal.

    It’s a fallacy because even when we do experience our expected sense of euphoria, it is short lived. Soon the feelings fade and we face the next destination and promise of happiness.

    This is connected to the happiness paradox.

    The happiness paradox and why you shouldn’t seek happiness.

    We expect to become happy when our situation improves, but we actually are happier when we don’t focus on reaching happiness (or even thinking about whether we are happy or not at all).

    So how can we reduce the arrival fallacy?

    3 Tools to manage the arrival fallacy

    Hannah England on Ness Labs shares three tools you can use to manage the arrival fallacy.

    1. Focus on the journey not the destination
    2. Avoid when/if happiness predictions
    3. Celebrate micro-wins

    But I think we can sum these up in one habit.

    Happiness and the habit of gratitude

    Practicing gratitude is a simple habit that involves the three previous tools.

    We regularly appreciate what we have now rather than looking to the future for happiness and in doing so celebrate micro-wins.

    If you want to start practicing gratitude, you could try writing down one thing you are grateful for each evening.

    Summary 👨‍🏫

    The arrival fallacy is when we believe we will be happy WHEN we reach an achievement. The truth is that these feelings always fade.

    The best remedy is to practice gratitude each day.

  • What is Survivorship bias (and how to avoid it)

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    Chris Wilson

    During the middle of the blitz, the allies needed to protect their pilots.

    They were being shot by German plans and anti aircraft guns but the distribution of bullets wasn’t even.

    Fortunate Abraham Wald knew about this cognitive bias and made the right choice.

    Survivorship bias is when we focus on those who are left rather than identifying patterns from those who didn’t make it.

    This can lead to noticing the wrong pattern and ignoring the right pattern.

    Want an example?

    What WW2 Plane Bullet Holes Can Teach You About Survivor Bias

    If the allies had reinforced the locations where their planes that survived were shot, they would have wasted material.

    The locations where they weren’t shot were the real risk areas as plans that were shot there didn’t survive.

    But how does this affect us?

    How Survivorship bias affects us

    When we listen to life lessons from successful people, we have to be careful for survivor bias.

    The classic example is a person who won the lottery and says “you’ve just got to believe in yourself and work hard.”

    But the majority of lottery players never win.

    Focusing on success stories leads to bad decisions like

    • walking into common mistakes
    • taking more extreme risks
    • not knowing when to give up

    Without looking at failures, we can ignore our own faults.

    So how do we overcome survivor bias?

    How to avoid survivor bias

    The main tool is proper perspective.

    Knowing if a survivor is the exception or the norm helps us evaluate their stories and experience.

    And looking at patterns in failures can help us avoid those same mistakes

    Summary 👨‍🏫

    Survivor bias shows that we tend to focus on the data of survivors but sometimes we just need to avoid what unifies those who don’t survive.

  • I accidentally researched a fake cognitive bias and ended up learning about a real one.

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    Chris Wilson

    I was preparing to share a new cognitive bias essay but as I prepared to publish, I received a surprised.

    It seems that it ISN’T real!

    While early studies found evidence for this bias, later meta-analysis showed a non-significant correlation.

    At first I was disappointed in the time I had wasted, but then I realised it was an opportunity to share about the biases that put me in this place.

    A bias that isn’t real

    In the 1971 two psychologist put forward the actor-observer asymmetry effect.

    It stated that actors (the people doing the action) attribute external circumstances for their behaviour, while observers look at internal factors.

    Examples?

    • An actor would say they study because an subject is difficult
    • An observer would say they study because the actor is hard-working.

    In contrast, an actor would say they were late because of the traffic. But an observer would say they were lazy or disorganised.

    The idea took off because it resonated with our experience.

    We often see or hear people attack others for making the same mistakes they have made (but blaming their motives).

    The trouble is, that’s not always the case and we blame external and internal alike.

    It turns out that our judgement of ourselves and others is far more complicated than we first thought, and the promotion of this bias actually was due to confirmation bias as well as publication bias.

    What is Publication Bias?

    This is the bias where studies with significant results are more likely to be published than those which don’t.

    This encourages researchers to find a correlation and means that we only hear about positive results (skewing perceptions).

    So while the actor-observer bias may not be real, the lesson it teaches is.

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