"Thinking, Fast and Slow" is an extensive introduction to the biases and inner mechanisms of the human brain.
While primarily a behavioral economics book, you will also find out about your limitations, how to more efficiently convince people, and understand why people make certain decisions despite feeling they are irrational.
All the conclusions are validated through experiments that Kahneman performed along the years.

How Humans Think

The human brain is controlled by two separate systems:
<ul>
<li>System 1 - Very fast, it works on intuition and evolves as we encounter common situations;</li>
<li>System 2 - Slower. We tend to avoid using it too much, but it is mandatory for complex problems that can't be answered by System 1, such as math problems.</li>
</ul>
You are not aware of which system is controlling the brain unless you make a conscious effort.
The following few ideas rely on this dual system distinction.

Two Systems

An answer to a number question can be influenced by previous information (even if it is completely unrelated to it). Using this strategy to influence decisions is called priming.
It acts as an anchoring effect, the human starts from the real answer he/she would give and goes up/down towards the number that was proposed (accidentally or not). This anchoring can be more or less strong (e.g. when the actual answer is 10, the suggested one is 5, and the person answers 8, it had a 20% impact).

Priming and Anchoring

<ul>
<li>Asking somebody whether he thinks an environment tax of 20% is too high or too low. If it is higher than what he/she had in mind, the answer will still be lower, but closer to 20% than it would have been before. Same for when it is higher.</li>
<li>Telling a judge how many years ago you came to the US can influence the length of the next prison sentence he gives. This is completely unrelated, but it is a number that the judge has in mind and can start from.</li>
</ul>

Examples of Priming

People tend to like or dislike everything about a person, thing, event or idea because it is easier for System 1 to work like that. Careful analysis of good and bad sides is much more mentally taxing.

Halo Effect

When answering a question, the brain tends to only focus on the available information, disregarding the one missing.For example: if you are told somebody is intelligent and strong you automatically think they are a good leader.This leads people to jump to conclusions.

All You See Is All There Is (AYSIATI)

People can associate intensity across subjects that are completely unrelated.For example: if crimes could be represented in colors, then murder would be a deeper shade than robbery.

Intensity Matching

The brain by default prefers using System 1 to answer questions. When the actual question can't be answered this way, it aims to answer a proxy question that can be.For example: When faced with the question "How much would you donate for a humanitarian cause?", the brain automatically turns it to "How much do I actually care about that cause?" and "How much money am I willing to lose donating?"

Proxy Questions

Experiments with a low sample (N) are much more likely to have extreme results than ones with a high N. Conversely, experimenting with large samples is more precise than with small samples.This can make us have a skewed view of reality by jumping to conclusions where evidence is not sufficient.

The Law of Small Numbers

Due to the halo effect and the fact that System 1 deals in averages, not sums, people tend to view things that have higher overall quality as better than ones with lower overall quality, even though the latter may be, in fact, strictly better.For example: 16 perfect-condition pieces of cutlery and 8 broken ones will be valued less than only the 16 perfect pieces, if viewed separately.

Less Is More

People change their opinion about something based on the ease that they retrieve arguments and examples for it.For example: you will think a course you're attending is better if you are asked to find 10 improvements rather than 5, because you will have a harder time finding them all.This applies in the case of news on very rare events that are suddenly an issue (e.g. terrorism, plane crashes). This leads to "Availability Cascades" where the people's emotions turn to irrational fear over insignificant risks.

Availability Bias

Success or failure are typically outliers due to luck and people/things regress to their usual performance (the mean, or the prior).For example: in a sports competition, an athlete that does much better than the rest on the first day will most likely perform worse on the following ones, because he attained the initial performance in part due to chance.Intuitively, this is how success is defined:<ul><li>success = talent + luck</li><li>great success = a little more talent + a lot of luck</li></ul>

Regression to the Mean

An easy way of making predictions by taking into account uncertainty and the natures of the 2 systems:<ul><li>Start with an estimate of the average answer;</li><li>Determine your estimate (performed by System 1);</li><li>Estimate the correlation between your evidence and the target (performed by System 2);</li><li>Use the correlation to move that many percents from the average to the estimate.</li></ul>For example: to estimate your GPA, start from the average GPA and set your expected GPA. Estimate how confident you are in your prediction. The predicted GPA will be closer to your expectation if your confidence is higher.

Intuitive Predictions

Not all domains are equal in nature. Some are more reliant on skill (e.g. surgery), while others are on luck (e.g. stock trading). People can be tricked into thinking that their success is actually based on skill despite the nature of their activity.

Skill Illusion

Experimentally speaking, intuition is less likely to come to a better conclusion than simple formulas, that are not influenced by human nature.For example: you will find more success in hiring candidates if you use a pre-determined checklist instead of relying on your interviewer sense.The importance of intuition increases based on the domain and its dependence on skill.

Intuitions vs. Formulas

When it comes to decision-making, there is a distinction between two idealized "species" of people:<ul><li>Humans - Beings with flaws and feelings, susceptible to each of the biases presented here</li><li>Econs - Beings that are always able to think rationally, unaffected by the biases presented here</li></ul>The "econ" term is the short form for "economist", as people that analyze and invest in the financial markets make every decision consciously, with a clear goal in mind.

Two Species

The degree of "utility" as perceived by people decreases gradually. $1,000 is perceived wildly different for somebody with a net worth of $10,000 vs. $1,000,000. Similarly, an increase from $1,000 to $2,000 is perceived as much better than one from $10,000 to $11,000 despite the equal increase.This is the utility theory developed by the mathematician Daniel Bernoulli.This theory is not ideal and cannot model every case. It fails in certain cases, which is why prospect theory was developed.

Utility Theory

Prospect theory is an improved version of the previous utility theory.Utility is instead based on differences from the reference point.Humans have, by default, some degree of loss aversion, so the absolute utility of a loss will be perceived as greater than one of an equal gain. A survey found that people would refuse a bet where they would gain $100 with a 50% chance and lose $100 otherwise. In fact, they would not accept until the gain is at least twice as big, depending on their degree of loss aversion.

Prospect Theory

Thus, there are 3 cognitive features in prospect theory:<ul><li>Evaluation based on a reference point</li><li>Diminishing sensitivity (borrowed from Bernoulli)</li><li>Loss aversion</li></ul>The theory does not take into account human feelings of disappointment when failing to win gambles.

Prospect Theory Summary

People become more unwilling to let go of the things or benefits they already own. They will only sell them for more than they would be willing to buy them for, even if some time ago they were indifferent to them. In short, they grow attached.

The Endowment Effect

Depending on the situation, people can be either risk averse or risk seeking. It is all about the probability of events happening and whether the end result will be positive or negative. For instance, when the chances are very much in favor and the result is positive, people are risk averse and fear the disappointment that luck won't be on their side, so they do anything to maximize their chances to 100%.The change from 0% to 1% chance (possibility) and from 99% to 100% chance (certainty) are important psychological thresholds.

The Fourfold Pattern

People tend to overestimate the probability of rare events and then overweight them in their decisions.An event is more likely to be preferred if its image is more vivid (e.g. receiving $100 in a blue envelope as opposed to only receiving $100).

Rare events

People (through System 1) are more sensitive to formulations like "12 out of 1,000" and will sometimes think it's more likely than a risk of 2%. Why? The image is more vivid and it is easier for System 1 to think in terms of individual cases as opposed to percentages.Additionally, people (again, System 1) will tend to be more sensitive to higher values of the denominator while disregarding the numerator: 100 out of 10,000 may be perceived as worse (or better, depending on the context) than 12 out of 1,000. This is called Denominator Neglect.

Statistics Put Nicely

When faced with a gamble or chance event, before declining it because of other biases (e.g. loss aversion), think not about the single instance where you win or lose, but rather about your whole life as a series of such gambles and whether the total number will lead to consistent gains. Think like a trader! This is called Broad Framing.

Risk Policies

Acting differently from the default option has the downside of bringing regret if the decision turned out to be wrong and defaulting was the best course of action.Example: you will feel better if you are injured at the convenience store you always go to, as opposed to getting injured at a new convenience store because the other one is doing renovations.

Regret

You can reach more sensible decisions when you have a broader context.In real life, judges are asked not to consult more than the case given to them and, thus, lack the broader context, leading to worse decisions regarding penalties.

Context Matters

Given all the previous information, you can guide people to a decision based on the framing of the problem.Take loss aversion into account - try to disguise the decision as a win (or loss if you prefer them not to take it).Think about the reference point and exercise thought of different ones (e.g. imagine you did not own X).

Focus On Framing

Think about the different mental accounts that are not, in fact, separate (e.g. gains on stocks vs. crypto) and imagine they were merged.Make the default option the one you want and the differences will be huge. For instance, in the case of governmental systems, the percentage of the population that donates organs on death is largely dependent on whether the citizen needs to submit a request to donate or to not donate on death. In 2003 this percentage was close to 100% for Austria and 12% for Germany. The difference lies in what the default option was.

Finally, along with the two systems and the two species, humans also have two selves:<ul><li>Experiencing Self - the self that experiences things in the moment;</li><li>Remembering Self - the self that remembers experiences, remembers them, assigns a rating, and likes creating stories.</li></ul>

Two Selves

The remembering self leverages System 1 and, when it comes to experiences, it cares about:<ul><li>The peak intensity (be it negative or positive);</li><li>The way they end;</li><li>To some extent, the average experience but not the duration, because System 1 deals with averages, not sums. This is called Duration Neglect.</li></ul>

Remembering Self

People can be determined to consider a strictly worse experience as better than another based on the impression of the remembering self.Example: in an experiment, people had their hands in very cold water for 60 seconds, then in cold water for 60 seconds and 30 seconds in slightly warmer water. When asked which experience they would rather repeat, most people chose the second option despite it being strictly worse.

Illusion of the Memory

The previous result makes sense because people tend to answer harder questions like "Which would you rather repeat?" with easier questions like "Which did you like more?"This way they can be convinced to repeat a worse experience just because it ended slightly better or had a lower peak intensity even though it took much longer. This is also why people would rather go through a long and painful surgery than an extremely painful surgery that takes a few seconds.

The neglect of experiencing self and the appeal of remembering self (even though both selves constitute us) leads people to like stories more than anything else.This is why we tend to ignore details that do not fit our view of the story, whatever it is: relationship, career, trips, etc.

Story Appeal

Predicting the future from current circumstances, heavily influenced by emotion (e.g. how your marriage will go based on your wedding day) is not ideal.

Affective Forecasting

Because of AYSIATI, people will attribute larger weight to things they are thinking about the moment.

Focusing Illusion

Nothing in life is as important as you think it is when you are thinking about it

People will regress to the mean and the happiness they experience will always turn back to an average value. For most of us, this average value is 7 on a scale from 1 to 10.

Daily Happiness

Lessons in Decision-Making from Nobel Laureate Daniel Kahneman

books

Books

problemsolving

Problem Solving

communication

Communication

personaldevelopment

Personal Development

Understand yourself and those around you.

psychology

Psychology

The Art of Decision-Making

Major New York Times bestseller Winner of the National Academy of Sciences Best Book Award in 2012 Selected by the New York Times Book Review as one of the ten best books of 2011 A Globe and Mail Best Books of the Year 2011 Title One of The Economist's 2011 Books of the Year One of The Wall Street Journal's Best Nonfiction Books of the Year 2011 2013 Presidential Medal of Freedom Recipient Kahneman's work with Amos Tversky is the subject of Michael Lewis's The Undoing Project: A Friendship That Changed Our Minds In the international bestseller, Thinking, Fast and Slow, Daniel Kahneman, the renowned psychologist and winner of the Nobel Prize in Economics, takes us on a groundbreaking tour of the mind and explains the two systems that drive the way we think. System 1 is fast, intuitive, and emotional; System 2 is slower, more deliberative, and more logical. The impact of overconfidence on corporate strategies, the difficulties of predicting what will make us happy in the future, the profound effect of cognitive biases on everything from playing the stock market to planning our next vacation—each of these can be understood only by knowing how the two systems shape our judgments and decisions. Engaging the reader in a lively conversation about how we think, Kahneman reveals where we can and cannot trust our intuitions and how we can tap into the benefits of slow thinking. He offers practical and enlightening insights into how choices are made in both our business and our personal lives—and how we can use different techniques to guard against the mental glitches that often get us into trouble. Winner of the National Academy of Sciences Best Book Award and the Los Angeles Times Book Prize and selected by The New York Times Book Review as one of the ten best books of 2011, Thinking, Fast and Slow is destined to be a classic.

Discover the world of business and economics.

economics

Economics

scienceandnature

Science & Nature

Major New York Times bestseller Winner of the National Academy of Sciences Best Book Award in 2012 Selected by the New York Times Book Review as one of the ten best books of 2011 A Globe and Mail Best Books of the Year 2011 Title One of The Economist's 2011 Books of the Year One of The Wall Street Journal's Best Nonfiction Books of the Year 2011 2013 Presidential Medal of Freedom Recipient Kahneman's work with Amos Tversky is the subject of Michael Lewis's The Undoing Project: A Friendship That Changed Our Minds In his mega bestseller, Thinking, Fast and Slow, Daniel Kahneman, the renowned psychologist and winner of the Nobel Prize in Economics, takes us on a groundbreaking tour of the mind and explains the two systems that drive the way we think. System 1 is fast, intuitive, and emotional; System 2 is slower, more deliberative, and more logical. The impact of overconfidence on corporate strategies, the difficulties of predicting what will make us happy in the future, the profound effect of cognitive biases on everything from playing the stock market to planning our next vacation—each of these can be understood only by knowing how the two systems shape our judgments and decisions. Engaging the reader in a lively conversation about how we think, Kahneman reveals where we can and cannot trust our intuitions and how we can tap into the benefits of slow thinking. He offers practical and enlightening insights into how choices are made in both our business and our personal lives—and how we can use different techniques to guard against the mental glitches that often get us into trouble. Winner of the National Academy of Sciences Best Book Award and the Los Angeles Times Book Prize and selected by The New York Times Book Review as one of the ten best books of 2011, Thinking, Fast and Slow is destined to be a classic.

Daniel Kahneman (born 5 March 1934) is an Israeli-American psychologist and winner of the 2002 Nobel Memorial Prize in Economic Sciences, notable for his work on behavioral finance and hedonic psychology.With Amos Tversky and others, Kahneman established a cognitive basis for common human errors using heuristics and biases (Kahneman & Tversky, 1973, Kahneman, Slovic & Tversky, 1982), and developed Prospect theory (Kahneman & Tversky, 1979). He was awarded the 2002 Nobel Prize in Economics for his work in Prospect theory. Currently, he is professor emeritus of psychology at Princeton University's Department of Psychology.

Daniel Kahneman

Thinking, Fast and Slow

Sometimes it's good to take a step back and think about whether you are truly productive or not. Many people get trapped in the cycle of "work for work's sake" - or W4W, when they work automatically on tasks that are not important, but they are not fully aware of that.The book describes the journey and advice of Tim Ferriss, on wasting only 4 hours of your week on things that you are not passionate about.

Managing Your Time And Life

The way of improving your life is paved with 4 key steps:<ol><li>Definition - defining seemingly common-sense notions</li><li>Elimination - killing the need for time management</li><li>Automation - automating your income</li><li>Liberation - enabling mobility</li></ol>Let's take them in order!

DEAL Making

<ul><li>Don't delay your happiness for early retirement, rather have many and frequent time-offs, it's the right way to live</li><li>Strive not for happiness, but for excitement!</li><li>When taking a risk, think about the worst-case scenario and how to still make the best of it. You will be less scared of taking that risk</li><li>Accurately define activities you want to do instead of general ones, or else you will postpone indefinitely</li><li>There is a direct correlation between an increased sphere of comfort and getting what you want - challenge your comfort zone constantly!</li></ul>

Defining Good Living Concepts

<ol><li>Retirement is worst-case-scenario insurance</li><li>Interest and energy are cyclical (why frequent time-offs are important)</li><li>Less is not laziness</li><li>The timing is never right</li><li>Ask for forgiveness, not permission</li><li>Emphasize strengths, not weaknesses</li><li>Things in excess become their opposite (e.g. help can become a hindrance)</li><li>Money alone is not the solution</li><li>Relative income is more important than absolute income (focus on per-hour income instead of per month)</li><li>Distress is bad, eustress is good (eustress is healthy stress that makes you become better and succeed)</li></ol>

Fundamental Rules of Work Life

Dreamlining is the process of brainstorming, visualizing, and planning out your dreams. We all should do it sometimes to keep ourselves in check and make sure we are on the right path to leading a good and satisfying life.

What is "Dreamlining"?

<ol><li>What would you do if there was no way you could fail? Name 5 things you dream of having, being, and doing</li><li>Drawing a blank? What would you do if you had $100 million in the bank? What would make you most excited to wake up in the morning?</li><li>What does "being" entail doing? (e.g. to speak Chinese fluently, you need to learn Chinese)</li><li>What are the 4 dreams that would change it all?</li><li>Determine the costs and calculate your Target Monthly Income (TMI) for achieving them in 6 and 12 months.</li><li>Determine three steps for each of the four dreams in just the 6-month timeline and take the first step now.</li></ol>

Dreamlining Checklist

Effectiveness is doing the things that get you closer to your goals. Efficiency is performing a given task (whether important or not) in the most economical manner possible. You should focus on effectiveness, rather than efficiency.You need to constantly ask yourself: "Am I being productive or just active?"A good approach to elimination will kill the need for time management. You won't deal with tasks that waste time.

How to Eliminate Unnecessary Tasks

Pareto's Rule: 80% of the outputs result from 20% of the inputs.<ul><li>Which 20% of sources are causing 80% of my problems and unhappiness</li><li>Which 20% of sources are resulting in 80% of my desired outcomes and happiness?</li></ul>Parkinson’s Law: a task will swell in (perceived) importance and complexity in relation to the time allotted for its completion.You should use both Pareto's rule and Parkinson's law synergistically. Keep the tasks that achieve the most results and finish them in a shorter amount of time.

Pareto's Rule and Parkinson's Law

<ul><li>When compiling your to-do list for tomorrow, for each task ask yourself: "If this is the only thing I accomplish today, would I be satisfied with my work?". If the answer is "no", it probably is not an important task</li><li>Do not multitask!</li><li>Practice selective ignorance - trim the sources of information that are time-consuming and not useful</li><li>Ask the people who you know are experts to save time instead of researching yourself (Tim once asked a better-informed friend with similar political views who he should vote for)</li></ul>

Tips and Tricks for Productivity Pt. 1

These tips relate to your behavior when dealing with people in a professional setting. There is a life outside work!<ul><li>Be difficult and assertive when it matters</li><li>Let unimportant things accumulate and complete them in batches</li><li>When faced with a meeting that you fear will be unproductive, claim that you need to go first and leave in 5 minutes</li><li>Appear busy to people to force them to be efficient in explaining their problems</li></ul>

Tips and Tricks for Productivity Pt. 2

<ul><li>Get a remote personal or virtual assistant who will do everything that consumes a lot of time and you hate doing - including reading and replying to emails</li><li>Never automate something that can be eliminated, and never delegate something that can be automated or streamlined</li><li>Always begin with the end in mind - carefully plan out processes and assess whether they will assure a stable income or will become a liability down the line</li></ul>

How to Automate Your Life

As to methods, there may be a million and then some, but principles are few. The man who grasps principles can successfully select his own methods. The man who tries methods, ignoring principles, is sure to have trouble.

A business should be designed to generate steady passive income with as little headache as possible.<ol><li>Pick an affordably reachable niche market</li><li>Brainstorm products</li><ol><li>One-sentence slogan</li><li>Price between $50-$200 - creates a high-end image, customers will be less likely to return or complain, and fewer unit sales are needed for profit</li><li>Should take no more than 3-4 weeks to manufacture</li><li>Everything should be explainable in an online FAQ</li></ol><li>Resell, license, or create the product</li></ol>

Quick Guide to Creating a Business

The step of liberation refers to the freedom of traveling and working from any place in the world you want.By this point, the elimination step will make your travels to different places less noticeable and the automation step will leave most other things in the hands of your assistant.If you work a 9-to-5 job, you need to prove to your boss that you are more productive in a remote setting. Start with small compromises and escalate to full-time remote in the end.

How to Liberate Yourself

Most people are reluctant to the nomad lifestyle and these are the top reasons they cite:<ul><li>Quitting is permanent</li><li>I won't be able to pay the bills</li><li>Health insurance and retirement accounts disappear if I quit</li><li>It will ruin my resume</li></ul>

Primal Fears of Liberation

None of the previous concerns are valid if you think them through:<ul><li>You will find a new job as you found your last one if needed</li><li>Add up costs necessary to live a few months in a foreign place and you will probably see that it is not too far from your regular expenses</li><li>Depending on your country, you may find that paying for your own insurance is cheaper than expected</li><li>When recruiters ask you about that gap year and you tell them you visited the world, the first thought in their mind will be "How can I do that as well?"</li></ul>

Why Fear of Liberation Is Wrong

<ul><li>You will have doubts about leaving the 9-to-5 life or working too little: "What am I doing with my time now? Am I wasting it?"</li><li>Realize that the amount of money you make does not make you more successful and some of your peers will earn more with a 9-to-5</li><li>You need to find your purpose. Generally, 2 components are fundamental for a good life: continual learning and service (choosing the cause you want to fight for, no matter what it is, there are rarely "right" or "wrong" causes you can serve)</li></ul>

And What Now?

<ol><li>Losing sight of dreams and falling into work for work’s sake (W4W)</li><li>Micromanaging and e-mailing to fill time</li><li>Handling problems your outsourcers or co-workers can handle</li><li>Helping outsourcers or co-workers with the same problem more than once, or with noncrisis problems</li><li>Chasing customers, particularly unqualified or international prospects, when you have sufficient cash flow to finance your nonfinancial pursuits</li><li>Answering e-mails that will not result in a sale or that can be answered by a FAQ or auto-responder</li></ol>

Final Mistakes You Should Avoid Pt. 1

<ol><li>Working where you live, sleep, or should relax</li><li>Not performing a thorough 80/20 analysis every two to four weeks for your business and personal life</li><li>Striving for endless perfection rather than great or simply good enough, whether in your personal or professional life</li><li>Blowing minutiae and small problems out of proportion as an excuse to work</li><li>Making non-time-sensitive issues urgent in order to justify work</li><li>Viewing one product, job, or project as the end-all and be-all of your existence</li><li>Ignoring the social rewards of life</li></ol>

Final Mistakes You Should Avoid Pt. 2

Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose

An edition expanded with more than 100 pages of new content offers a blueprint for a better life, whether one's dream is escaping the rat race, experiencing high-end world travel, earning a monthly five-figure income with zero management or just living more and working less.

What do you do? Tim Ferriss has trouble answering the question. Depending on when you ask this controversial Princeton University guest lecturer, he might answer: “I race motorcycles in Europe.” “I ski in the Andes.” “I scuba dive in Panama.” “I dance tango in Buenos Aires.” He has spent more than five years learning the secrets of the New Rich, a fast-growing subculture who has abandoned the “deferred-life plan” and instead mastered the new currencies—time and mobility—to create luxury lifestyles in the here and now. Whether you are an overworked employee or an entrepreneur trapped in your own business, this book is the compass for a new and revolutionary world. Join Tim Ferriss as he teaches you: • How to outsource your life to overseas virtual assistants for $5 per hour and do whatever you want • How blue-chip escape artists travel the world without quitting their jobs • How to eliminate 50% of your work in 48 hours using the principles of a forgotten Italian economist • How to trade a long-haul career for short work bursts and freuent "mini-retirements" • What the crucial difference is between absolute and relative income • How to train your boss to value performance over presence, or kill your job (or company) if it’s beyond repair • What automated cash-flow “muses” are and how to create one in 2 to 4 weeks • How to cultivate selective ignorance—and create time—with a low-information diet • What the management secrets of Remote Control CEOs are • How to get free housing worldwide and airfare at 50–80% off • How to fill the void and create a meaningful life after removing work and the office You can have it all—really. From the Hardcover edition.

Tim Ferriss is author of three #1 NYT/WSJ bestsellers: The 4-Hour Workweek, The 4-Hour Body, and The 4-Hour Chef. He is also a start-up advisor specializing in positioning, PR, and marketing (Uber, Evernote, etc.). When not damaging his body with abusive sports, he enjoys chocolate, bear claws, and Japanese animation.

Timothy Ferriss

The 4-Hour Workweek

The 4-hour Workweek

Efficiently leading an organization is something that many people struggle with these days. While there is no easy path to do it successfully, there are some guidelines and ideas that can surely help.From Circles of Safety to happiness chemicals and empathy, follow me on this journey to learn how to be a better leader, one step at a time!

How to Lead

The first step to being a good leader is understanding that an organization is essentially a Circle of Safety. The people's insecurities vanish inside this Circle, but a bad leader will inevitably shrink or fracture it into multiple small ones.Outside of the Circle, there is uncontrollable danger, but inside of it we can make it safe.

The Circle of Safety

When discussing human behavior, we need to dig a bit into how the brain works. There are 4 primary chemicals for happiness:<ul><li>Endorphins</li><li>Dopamine</li><li>Serotonin</li><li>Oxytocin</li></ul>Let's see when each of these is released.

An Introduction to Happiness Chemicals

The first 2 chemicals are called "selfish" because they are focused on personal survival.<ol><li>Endorphins mask physical pain with pleasure and are a response to stress or fear. An example of endorphins release is the "runner's high" or laughing - it actually causes pain, which is masked by endorphins and that's why if we laugh too much it eventually starts hurting.</li><li>Dopamine causes the feeling of satisfaction after accomplishing something important to us. It is proportional to the effort.</li></ol>

The "Selfish" Chemicals

The other 2 chemicals are focused on socialization and our belonging to a group.<ol><li>Serotonin causes the feeling of pride when others like or respect us.</li><li>Oxytocin is released to give us feelings of friendship, love, and deep trust. Without it, we couldn't love our children and wouldn't have a partner in the first place. It dictates the vulnerability we can afford to show to people. It is a long-lasting chemical and it is the reason why hand-shaking is so important in our society.</li></ol>

The "Social" Chemicals

Oxytocin and serotonin grease the social machine. And when they are missing, friction results.

Aside from the happiness chemicals, there is also the notion of cortisol the stress hormone. Historically, it's released when danger is close and we need to get out of a life-threatening situation.Unfortunately, unhealthy work environments lead to our bodies being inundated with cortisol, which causes our bodies to turn off "unnecessary" functions, such as digestion, growth and the immune system.We physically feel sick in an unhealthy work environment.

What Is Cortisol?

People tend to chase the title of "leader" because it comes with great perks. These perks, however, come with the responsibility they have over their subjects or employees. Those who do not uphold this duty accordingly are weak leaders.Any perk you receive in a company or organization is meant for your position, not for you.

Leaders in an Organization

Rules keep our society moving forward. But we don't really trust rules, we obey them. Trust is something inherently human due to oxytocin.This is the reason we often hate bureaucrats. They always follow the rules and never show the human side our brain understands better.

Human Nature and Rules

We don’t just trust people to obey the rules, we also trust that they know when to break them.

August 5, 1981, was the moment layoffs were normalized in the US by Ronald Reagan. He fired over 11,000 air traffic controllers on strike that day.Layoffs have the goal of protecting commerce over people. Abstraction of people into employees makes us lose empathy and when we can't see the people we affect, we make decisions much easier.

Normalizing Layoffs

While layoffs can be a quick solution to make ends meet in financial statements, it does not mean they won't have long-term consequences.The concept of "lifetime employment" guarantees an employee that he will never be fired. This was put into practice with good results. It will boost morale and communication; instead of firing people, you focus on why they perform worse and solve that.Get to know the people you fire and you may change your mind.

Lifetime Employment

A single death is a tragedy, a million deaths are a statistic.

There is a magic number of close connections that humans can have. That number is 150. If one of an organization's offices or factories has more employees, the human connections grow cold and won't be as motivated.This is no empirical estimation. Old hunter/gatherer tribes usually had 100-150 members. A company of marines consists of around 150 people.When informality at the workplace is replaced by formality, it may be a hint that the group became too large and the Circle of Safety fractures.

The Magic Number

Actually getting to see what impact your work has is infinitely more important than your boss complimenting you on it.Due to human nature, putting money on the line is usually not as impactful emotionally as offering your time and energy to other people - our brains are not made to process the abstraction of money as easily as the implication of our peers.Keep this in mind to motivate the group you lead. Human interaction is everything!

Meet the People You Help!

We can never trust someone right away. Meeting a person for the first time naturally releases dopamine that masks how we actually feel about that person until the novelty fades; this is why we shouldn't get married after a week. Conversely, if after several years we still feel like we don't belong in a group, maybe it's time to let go.Getting to know if we can trust someone takes more than 7 days and less than 7 years. These are the magic timeframes of trust.

How Long Does It Take to Trust Someone?

"Destructive Abundance" is the state where protecting the results is prioritized above protecting those who produce the results.Companies get in this state because the leaders only care about the score but forgot why they decided to play the game in the first place. Challenge is replaced by temptation and people are replaceable.

Destructive Abundance

Those at the top have all the authority and none of the information. Those at the bottom have all the information and none of the authority.

Leaders have the vision and should delegate the authority to the ones with the information, that they can trust.Trust requires integrity - the capacity of someone to consistently adhere to some moral values.

Authority and Integrity

How you do anything is how you do everything.

In "Alcoholics Anonymous" people don't get sober until they complete the 12th (and last) step of the program, which involves helping another addict overcome his addiction. It is the helping of another human that motivates.Similarly, your best days at work were not the ones when everything went perfect, but when everything went wrong, the hardship was shared and your team pulled through as a group.Empathy is a second-by-second requirement to being a leader!

Organizations are Inherently Social

Human beings have thrived for fifty thousand years not because we are driven to serve ourselves, but because we are inspired to serve others.

corporateculture

Corporate Culture

teamwork

Teamwork

business

Business

leadershipandmanagement

Leadership & Management

career

Career

How to Manage a Hybrid Team

" The highly anticipated follow-up to the acclaimed bestseller Start With Why Simon Sinek's mission is to help people wake up every day inspired to go to work and return home every night fulfilled by their work. His first book, Start With Why, offered the essential starting point, explaining the power of focusing on WHY we do what we do, before getting into the details of WHAT and HOW. Start With Why became an instant classic, with a loyal following among Fortune 500 companies, entrepreneurs, nonprofits, governments, and the highest levels of the U.S. Military. Now Sinek is back to reveal the next step in creating happier and healthier organizations. He helps us understand, in simple terms, the biology of trust and cooperation and why they're essential to our success and fulfillment. Organizations that create environments in which trust and cooperation thrive vastly out perform their competition. And, not coincidentally, their employees love working there. But "truly human" cultures don't just happen; they are intentionally created by great leaders. Leaders who, in hard times, would sooner sacrifice their numbers to protect their people, rather than sacrifice people to protect their numbers, are rewarded with deeply loyal teams that consistently contribute their best efforts, ideas and passion. As he did in Start With Why, Sinek illustrates his points with fascinating true stories from many fields. He implores us to act sooner rather than later, because our stressful jobs are literally killing us. And he offers surprisingly simple steps for building a truly human organization"--

Finally in paperback: the New York Times bestseller by the acclaimed, bestselling author of Start With Why and Together is Better. Now with an expanded chapter and appendix on leading millennials, based on Simon Sinek's viral video "Millenials in the workplace" (150+ million views). Imagine a world where almost everyone wakes up inspired to go to work, feels trusted and valued during the day, then returns home feeling fulfilled. This is not a crazy, idealized notion. Today, in many successful organizations, great leaders create environments in which people naturally work together to do remarkable things. In his work with organizations around the world, Simon Sinek noticed that some teams trust each other so deeply that they would literally put their lives on the line for each other. Other teams, no matter what incentives are offered, are doomed to infighting, fragmentation and failure. Why? The answer became clear during a conversation with a Marine Corps general. "Officers eat last," he said. Sinek watched as the most junior Marines ate first while the most senior Marines took their place at the back of the line. What's symbolic in the chow hall is deadly serious on the battlefield: Great leaders sacrifice their own comfort--even their own survival--for the good of those in their care.      Too many workplaces are driven by cynicism, paranoia, and self-interest. But the best ones foster trust and cooperation because their leaders build what Sinek calls a "Circle of Safety" that separates the security inside the team from the challenges outside. Sinek illustrates his ideas with fascinating true stories that range from the military to big business, from government to investment banking.

Simon Oliver Sinek is a British-born American author and inspirational speaker. He is the author of five books, including Start With Why and The Infinite Game.

Simon Sinek

Leaders Eat Last

Your brain is arguably your most important asset and what keeps you going every day. To be our best selves, we need to have it function at its full potential.People tend to disregard brain health and often think that diseases affecting it such as dementia come naturally with old age. However, this is not the case if we choose to care for it ahead of time.

How to Keep a Healthy Brain

<ol><li>The brain remains a complete mystery</li><li>Older people are doomed to forget things</li><li>Dementia is an inevitable consequence of old age</li><li>Older people can't learn new things</li><li>You must master one language before learning another</li><li>A person who has memory training never forgets</li></ol>

6 Myths About the Brain

<ol><li>We only use 10% of our brains</li><li>Male and female brains differ in ways that dictate learning abilities and intelligence</li><li>A crossword puzzle a day can keep the brain doctor away</li><li>You are dominated by either your right or left brain</li><li>You only have 5 senses (there are 6 other senses in the brain)</li><li>You're born with all the brain cells you'll ever have, your brain is hardwired, and brain damage is always permanent</li></ol>

6 More Myths About the Brain

There are 5 actions you should follow when it comes to taking care of your brain:<ol><li>Move - have an active life, exercise</li><li>Discover - learn new things often</li><li>Relax - take breaks and give your brain time to rest</li><li>Nourish - as the saying goes, "Mens sana in corpore sano"</li><li>Connect - socialization is important</li></ol>

The Pillars of Brain Health

<ul><li>Exercise prevents other diseases than ultimately affect your brain</li><li>Keeping your body in top shape is highly beneficial to any mental activity</li><li>Always find the time to exercise, don't treat it as something that can be skipped if your schedule gets crowded</li><li>At least 150 min. of moderate exercise per week, 450 min. for the key to longevity</li><li>Weight lifting is not as effective; focus on cardio activities, including jogging, swimming, aerobics, dancing, walking etc.</li></ul>

Have an Active Life

Keep your brain young, healthy, and sharp with this science-driven guide to protecting your mind from decline by neurosurgeon and CNN chief medical correspondent Sanjay Gupta. Throughout our life, we look for ways to keep our mind sharp and effortlessly productive. Now, globetrotting neurosurgeon Dr. Sanjay Gupta offers insights from top scientists all over the world, whose cutting-edge research can help you heighten and protect brain function and maintain cognitive health at any age. Keep Sharp debunks common myths about aging and cognitive decline, explores whether there’s a “best” diet or exercise regimen for the brain, and explains whether it’s healthier to play video games that test memory and processing speed, or to engage in more social interaction. Discover what we can learn from “super-brained” people who are in their eighties and nineties with no signs of slowing down—and whether there are truly any benefits to drugs, supplements, and vitamins. Dr. Gupta also addresses brain disease, particularly Alzheimer’s, answers all your questions about the signs and symptoms, and shows how to ward against it and stay healthy while caring for a partner in cognitive decline. He likewise provides you with a personalized twelve-week program featuring practical strategies to strengthen your brain every day. Keep Sharp is the only owner’s manual you’ll need to keep your brain young and healthy regardless of your age!

Thinking, Fast and Slow

The 4-hour Workweek

Leaders Eat Last

Keep Sharp

The Gift of Fear

Cristian Popa