Being effective as a Product Manager requires influence without authority - convincing a broad portfolio of stakeholders to work together on a shared vision. The true secret to herding cats is to convince the cats to herd themselves!
In this workshop Tyler Odean, a Group PM at Google, did a whirlwind tour of our cognitive biases and the psychology of decision making (drawing heavily from Thinking Fast & Slow) to help frame a set of practical tips and tricks for making your arguments as persuasive as possible.
9. Our lived experience is comprised of two separate and distinct systems.
(this is an oversimplification, but a useful one)
System #1
fast and cheap, but error prone
System #2
precise, but expensive and slow
10. System #1 System #2
Fast
Effortless
Involuntary
Black/White
Approximate
Confident
Slow
Effortful
Deliberate
Nuanced
Precise
Skeptical
11. System #1 System #2
Fast
Effortless
Involuntary
Black/White
Approximate
Confident
Slow
Effortful
Deliberate
Nuanced
Precise
Skeptical
21. Availability causes ideas that come to mind easily to seem more true.
Feels
Vivid
Recent
Frequent
Clear Display
Good Mood
Familiar
Common
Likely
Good
True
22. Availability is why advertising works.
Feels
Vivid
Recent
Frequent
Clear Display
Good Mood
Familiar
Common
Likely
Good
True
23. … and why heavy news coverage makes us overestimate risks.
Feels
Vivid
Recent
Frequent
Clear Display
Good Mood
Familiar
Common
Likely
Good
True
24. Availability can also operate in reverse.
Feels
Vague
Diffuse
Hard to picture
Unknown
Bad Mood
Foreign
Rare
Unlikely
Bad
False
26. We estimate things by anchoring on a reference value as a starting point.
Adjusting from the anchor is effortful, so we tend to err in that direction.
27. We also experience anchoring from readily available comparisons.
Web - $59
Web & Print - $125
Web - $59
Print - $125
Web & Print - $125
29. System #1 isn’t great at math, so we evaluate packages and outcomes by
estimating a representative norm rather than as a sum.
SET A SET B
WHEN WE COMPARE
VALUE DIRECTLY
$ < $$
WHEN WE ESTIMATE
VALUE SEPARATELY
$$ > $
31. We don’t have good natural intuitions about probability. Instead we estimate how
likely things are by the coherence of the story we can build explaining them.
xkcd.com/552
32. A desire for coherence also causes us to ignore contradictions,
which causes the Halo Effect and is why this sentence is uncomfortable:
Hitler loved puppies
33. Coherence also gives us Confirmation Bias - changing our minds is effortful
because it requires overcoming the inconsistency with our past selves.
CHAINSAWSUIT.COM
35. Framing effects can make us perceive the same circumstances differently,
depending on how the information is presented.
36. Organ donation consent rate by country
Framing determines what choice is seen as default or normal.
Deviating from normal is more effortful and we also perceive it as riskier.
opt-in vrs opt-out
38. We intuitively evaluate outcomes as a gain or a loss from a reference point,
and we are ~2-2.5x as loss averse as we are drawn to gains.
VALUE
GAINSLOSSES
39. We can only perceive a minimum quanta of risk, so our ability to estimate rare
events is very poor. We round up on some risks and down on others.
WE OVERESTIMATE RARE
EVENTS WHEN THEY ARE:
precise / easy to picture
described to us
emotionally significant
on our minds recently
represented concretely
(~1 in 1000 children, e.g.)
WE UNDERESTIMATE RARE
EVENTS WHEN THEY ARE:
diffuse / difficult to picture
remembered from experience
emotionally insignificant
not recently relevant
represented abstractly
(~0.1% of children, e.g.)
40. Separately from our ability to estimate risk, we also intuitively
overvalue both possibility (gambling) and certainty (insurance).
ESTIMATED PROBABILITY
DECISIONWEIGHT
41. The combination of loss aversion and our intuitive weighing of risk
create what Kahneman calls The 4-Fold Pattern.
LOSSES GAINS
NEARCERTAINTYPOSSIBILITY
FEARFUL
(Accept settlement)
FEARFUL
(Buy insurance)
HOPEFUL
(Reject plea deal)
Hopeful
(Buy lottery Tickets)
43. Just study this slide
s great i am really enjoying this talk Tyle
y enjoying this talk Tyler is great i am rea
this talk Tyler is great i am really enjoyin
er is great i am really enjoying this talk Ty
m really enjoying this talk Tyler is great i
this talk Tyler is great i am really enjoyin
er is great i am really enjoying this talk Ty
44. What % chance?
The project has 100 dependencies.
Each has a 95% chance to go
according to plan. What % of the
time should we expect the project
to go according to plan?
45. Rank these words
FROM MOST NEGATIVE (-2) to MOST POSITIVE (2)
Iktitaf
kadirga
nansoma
Biwonji
saricik
46. HOw MUCH $
A PHARMACEUTICAL COMPANY
WANTS TO RUN A TEST WHERE
THERE IS A 1
/10,000 CHANCE OF
BECOMING INFECTED WITH A FATAL
DISEASE. hOW MUCH WOULD THEY
NEED TO PAY YOU TO PARTICIPATE?
50. Make it easy to agree
Make your preferred choice the default
Don’t leave behind open questions
51. Set the reference point
Describe outcomes as losses/gains from your preferred reference
Know where that puts you on the 4-Fold Pattern
52. Control the presentation
Dial up or down emphasis by making things more concrete or abstract
Keep flattering comparisons close, remove unflattering ones entirely