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Tech, Strategy, and other interesting things by Roberto Zoia

Strategy and Technology

Difficult Decisions

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Sometimes, you have to make a decision that implies choosing between two negative outcomes. This is called the lesser evil principle. How do you make the best decision in this context? Some ideas that may help.

  1. Part of what makes this kind of decision difficult is that it is hard to accept that we are going to loose either way. However, because the damage derived from each choice is not the same, it is important to have clarity about which negative consequences we are willing to bear, and which not.
  2. We need to identify emotional and psychological components that may be cluttering our judgement, or making us rationalize an emotional decision unconsiously taken beforehand.
    A symptom of this is only considering arguments that reinforce our position.
  3. Beware of what Adam Grant calls the first instinct fallacy1. We fall in love with our first solution to the problem, without regarding that there may be other better possibilities.
  4. We prefer the security of the known to the uncertainty of opening ourselves to unknown possibilities. But the known option may not provide the best outcome. Also, we may the social pressure that may come from changing our mind, specially if some specific opinion is expected in our social circle regarding certain topics.
    Sometimes, no matter what the arguments are, we don’t listen because we feel that our identity is being threatened if we change our mind.
  5. We need to consider first and second order effects. Second order effects are those derived from the first effects. We need to ask: in this scenario, what would happen next? And after that? What would happen in a year from now? In four years?
  6. We cannot disregard a negative effect only because its probability of happening is low. We need to evaluate the impact of that possibility actually happening. For example, when playing Russian Roulette the probabilities of winning are 83% and only 17% of losing… but with fatal consequences.

Complex situations don’t have a simple o clear solution. We rarely have perfect information. When we are forced to choose between two negative outcomes, it’s critical to consider the worst outcome possible, disrigarding the possibility of the outcome actually happening. In another context, that is why people buy insurances against rare but dangerous events such as earthquakes. In those cases, arguing that you don’t belive that there will be an earthquake this year doesn’t help. You need to evaluate the possible loss if there is an earthquake.

  1. Adam Grant, Think Again. Accordingo to the author, in 33 studies, in all cases the revised solution proved to be better than the initial solution.↩

Photo by Leslie Cross on Unsplash

Decisiones difíciles

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A veces hay que tomar una decisión que implica escoger entre dos opciones malas. Es lo que se llama decidir por el mal menor. ¿Cómo llegar a la mejor decisión en este contexto? Detallo a continuación algunas consideraciones que pueden ayudarnos a tomar una buena decisión.

  1. Parte de la dificultad es aceptar que en los dos casos perderemos. Sin embargo, no en los dos casos el daño es el mismo. Ante el dilema del mal menor, es importante tener claro cuáles de las consecuencias negativas estamos dispuestos a sufrir y cuáles no.
  2. Hay que identificar los componentes emocionales o psicológicos que puedan estar sesgando nuestra decisión, o llevándonos a racionalizar una decisión emocional inconscientemente tomada de antemano.
    Una manifestación de este sesgo es, por ejemplo, buscar o escuchar solo argumentos que justifiquen nuestra decisión, y descartar los que la cuestionan.
  3. Estar prevenidos contra lo que Adam Grant llama la falacia del primer instinto1.
    que consiste en apegarse a la solución instintiva, negándonos consciente o inconscientemente a considerar otras posibilidades o a hacer una evaluación en profundidad.
  4. A veces preferimos la seguridad de la opinión conocida a la incertidumbre que puede causar abrirnos a otras posibilidades. Otras veces tememos la presión social que puede ser consecuencia de un cambio de posición. Por ejemplo, cuando en nuestro círculo “se espera” determinada opinión o postura.
    Otras veces, no estamos dispuestos a cambiar posturas que consideramos parte de nuestra identidad, sin importar los argumentos que nos presenten.
  5. Hay que identificar las consecuencias de cada alternativa, tanto de primer como de segundo orden. Consecuencias de segundo orden son las que se derivan de las consecuencias. ¿Qué pasaría sí…? ¿Y luego? ¿Y luego? En este escenario, ¿qué podría pasar en un año? ¿en cuatro?
  6. No basta considerar la probabilidad de que algo ocurra, o descartar una posibilidad porque la probabilidad de que se dé es baja. Hay que evaluar también el impacto de que se dé esa posibilidad.
    Así, el que juega ruleta rusa tiene 83% de probabilidades de ganar y solo 17% de perder… con consecuencias fatales.

Las situaciones complejas no tienen siempre una solución clara o simple. Cuando tenemos que elegir entre dos opciones malas, es crítico considerar que es lo peor que podría pasar, sin afectarlo de la probabilidad de que suceda. En otro contexto, por eso contratamos seguros contra eventos poco probables pero graves como terremotos y pérdidas totales. En esos casos, no se puede aplicar un razonamiento del tipo “no creo que haya un terremoto este año”. Para decidir, es necesario evaluar la pérdida en el supuesto de que el evento grave se diera.

  1. Adam Grant, Think Again. Según el autor, en 33 estudios sobre el tema, en todos los casos la solución revisada demostró ser mejor que la inicial. ↩

Photo by Leslie Cross on Unsplash

How to Choose What Books to Read

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Picking what books to read is always challenging. Time is limited, and even the fastest reader can only read a handful of books in her lifetime. Through the years I’ve collected some criteria for choosing what I read, either by experience or by stealing from greater minds, which can help you in the process of choosing the right books.

  • Long-term value: will what you learn from this book be relevant in the long-term, say, in 10 years or more1?

    If you apply this rule, you’ll soon discover that most of what “everybody is reading” won’t make the cut.

    For books, time is like a test of quality. Trust book recommendations, but not too much. Most new books follow the “book-marketing manual”, paying the media to get attention, having their authors interviewed in popular podcasts, etc. Suddenly it seems that everybody is reading that new, shiny book. Meanwhile, Marcus Aurelius cannot rely on paid advertising to promote his outstanding Meditations, written almost 2,000 years ago.

  • Leverage: “Leverage is achieving results significantly greater than the force you put in2.” Will reading this book give you leverage? If yes, what kind of leverage? Where can you apply it? How can you keep it?

    The Great Mental Models, Volume 1: General Thinking Concepts by Shane Parrish is one of the best books I’ve read in the last years. This is a book that will stand the test of time, and will provide great leverage, because “the skill of finding the right solution for the right problem is one form of wisdom3“.

  • Thinking and decision making: will this book help my thinking process? Will it help me make better decisions?

    How to Take Smart Notes by Sónke Ahrens, explains Luhmann’s Zettelkasten could help you improve not only your note-taking but also your thinking process. Expressing what we’ve read about by writing our insights confronts us with our lack of understanding.

  • Step out of your domain of expertise. Will reading this book give a different perspective on a particular topic, or are you falling in some kind of confirmation bias? Will it require effort on my part to understand what the author is proposing? (For non-fiction, books that don’t challenge you or that don’t require any effort to read are usually not worth your time.)

    Some people don’t read books like Frankl’s Man’s Search for Meaning because they fear to confront their long-term purpose and motivation. Or because reading about Nazi’s concentration camps make them feel uncomfortable. Other people can’t stand Nassim Taleb’s attitude, even if some of his books are of indispensable reading. Some people criticize James P. Carse for writing Finite and Infinite Games as it were a theological treatise from centuries ago, but the book it’s definitely worth your time.

  • What questions do I expect this book to answer? Sometime you read a book because you trust the author. In those cases, even if there is an emotional component involved, you implicitly know the topics the author writes about, and how the book can help you. Most of the time, however, you should have in mind what questions do you expect the author to anwser in the book.

Book Reading 2020 (non-fiction)

In 2020, I read 17 non-fiction books:

If you are looking for non-fiction book recommendations for 2021, you can’t go wrong with The Great Mental Models by Shane Parrish, How to Take Smart Notes by Sönke Ahrens, and The Practice by Seth Godin.

Even if in 2020 I read more non-fiction books than in previous years, I didn’t accomplish my goal of two books per month. I broke my reading routine several times for days and sometimes even weeks. So, borrowing from one the Knights Radiant ideals4, this year I’ll focus on journey before destination. I’ll focus on reading at least 25 five pages every day.

Book Reading 2020 (fiction and fantasy)

I also read 6 novels, some of them very long:

I love both fiction, hard science-fiction, and fantasy books. But if I had to pick one book from the list above, I recommend Cryptonomicon by Neal Stephenson. The plot happens in two parallel timelines, alternating between code-breakers and tactical-deception operatives in World War II, and their part-decendants building a data haven and anonymous cyber-banking in the late 1990’s.

Happy reading!

  1. There are exceptions to this rule, for example, when you want to learn something specific and tactical. But those exceptions should be few. ↩
  2. The Great Mental Models Volume 2: Physics, Chemestry and Biology, by Shane Parrish, p. 110. ↩
  3. cfr The Great Mental Models, Volume 1, by Shane Parrish, Kindle Edition, loc. 98 ↩
  4. Taken from Brandon Sanderson’s The Way of Kings, from the Stormlight Archive series. ↩

Facebook, la empresa de publicidad

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Facebook hace dinero recolectando información sobre sus usuarios y vendiéndola como publicidad cuidadosamente segmentada. El 2019, Facebook tuvo ingresos por 55,838 millones de dólares, de los cuales el 98% fueron por venta de publicidad (55,838 millones). Si usar Facebook es gratis, no es porque Facebook sea una empresa generosa, sino porque nosotros somos el producto.

El identifier for advertisers es una característica de iOS que, cuando está habilitada, permite que las aplicaciones recolecten nuestros datos de uso de apps y websites. Es una característica clave para Facebook y sus partners, cuyo modelo de negocio es recolectar data sobre los usuarios y venderla de un modo altamente segmentado en forma de publicidad. Apple ha anunciado que en una próxima versión del iOS 14, cualquier aplicación que recolecte datos de uso, tendrá que contar con el permiso explícito del usuario.

Las opciones por defecto son importantes1. Solo un pequeño número de usuarios se sumerge en la configuración de su iPhone y cambia la configuración por defecto de recolección de datos para avisaje. Facebook sabe que si la nueva configuración por defecto de iOS es no permitir la recolección de datos, pocos cambiarán esa opción.

Facebook ha reaccionado montando una campaña en la que acusa a Apple de atentar contra la libertad. ¿Alguien piensa que a Facebook le preocupa la libertad de sus usuarios? Cuando en unas semanas tu iPhone te pregunte si deseas permitir que Facebook monitoree tu uso del teléfono y recolecte tus datos, ¿contestarás que sí?

  1. cfr Johnson and Goldstein (2004), Default and Donation Decisions. ↩

Facebook, the Advertising Company

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Facebook makes money from collecting data about its users and selling it as precisely targeted advertising. In 2019, Facebook reported a total revenue of 55,838 Million Dollars, 98% of which came from advertising (55,013 Million Dollars). If Facebook is free to use, it’s not because they are generous. It’s because you are the product.

The ‘Identifier for advertisers’ is a feature in iOS that, when enabled, allows apps to track users cross apps and websites. It’s a key feature used by Facebook and its advertising partners to collect data about you and sell segmented advertising. In June 2020, Apple announced that in a future iOS 14 upgrade, it would change the default setting in iOS from opt-in to opt-out, forcing Facebook and anyone using this identifier to track users, to explicitly ask the user permission to do so.

Defaults options matter1. Only a small percentage of users dive into their iPhone settings to opt-out of ad targeting. Facebook knows that if the new default in iOS is no ad targeting, most users won’t opt-in even when asked. Google pays Apple billions each year to be the default search engine in iOS because, again, defaults matter.

Do you believe that Facebook cares about freedom? Will you opt-in when confronted with a message in your iPhone asking if you want to allow Facebook and its partners to track you?

  1. cfr Johnson and Goldstein (2004), Default and Donation Decisions. ↩