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Mental models in a nutshell. Practical thinking frameworks to amplify your decision-making and simplify your life.

Written by Thinknetic. Narrated by Aaron Yeager.

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Introduction.

A young man, new to the city, was peering through the window of a restaurant when Jan, the restaurant's owner, approached him. The stranger introduced himself as Anthony and explained that he had come to find work so that he could support his wife, two young sons, and his elderly mother. Times were hard, and he hoped to save enough to bring his family to the city to have a more stable life. He was able to find a laborer's job at a scrap metal site nearby that paid a measly wage, but it was better than nothing. "I can only afford a few cents for one meal a day," he said.

Jan brushed his apology aside and invited him in. He served the young man himself and cheerfully accepted the fifty-cent coin he paid in exchange. As the days passed, Jan grew to admire Anthony's diligence and family values. He gave him daily words of encouragement as he took his order personally and wrapped his meal for him. The two became good friends. The days turned into weeks, the weeks into months, and the months into years. Each evening, Anthony stopped at the restaurant to get his one meal of the day and chat with Jan, who always kindly asked about his family and how his work was progressing. And Jan charged him no more than the 50-cent price that Anthony paid.

Then came one happy evening when Anthony arrived with a wide grin on his face. He had bought a modest house in a good neighborhood with a good school for his boys, and he had just sent for his family to join him. Jan was genuinely thrilled as he patted his friend on the back and warmly congratulated him. Anthony then said that he was in a celebratory mood and he would be spending an entire five dollars on his evening meal. Jan told him it was well deserved, wrapped up his meal, and happily waved as he set off for home.

Anthony got home and opened up his meal pack. To his shock and dismay, it was the same meal he had been having every day for the last six years. All along, Anthony had been looking forward to a feast fit for a king, worth the five dollars he splurged for it. Instead, he got a fifty-cent meal. He was livid at Jan, who dared cheat him out of his well-deserved celebration. He immediately hurried back to the restaurant to complain, but by the time he arrived, Jan had already left. One of the staff with whom he was quite familiar greeted him instead.

"Peter, glad you're here. I think you guys gave me the wrong meal pack today. I can see how you can mistakenly give me the same fifty-cent meal I have every day. But today, I'm celebrating, and I paid five whole dollars. Help me out here. You don't want me to think that you've cheated on me, right?"

Peter looked at the meal pack. "Well, sir, this is our most expensive meal, and it costs five dollars."

It suddenly dawned on Anthony that he had not been cheated by his friend at all. Jan had been giving him their best meal, which cost $5, for 50 cents every day for six years. He felt utterly mortified for thinking that his good friend could shortchange him. "It's all a misunderstanding then," he murmured, and quickly turned to hide the tears in his eyes.

"One minute, sir," said the staff. "My boss said you were going to come back, and that I was to give you this bag." When Anthony opened the bag, he found all the 50-cent coins he had ever spent at this restaurant. Unable to hold back his tears now, he sat down on the bench and wept unashamedly.

Anyone reading this story cannot help but feel Anthony's profound regret for misjudging his friend and benefactor. At the same time, we tend to excuse his behavior by saying, "Well, he couldn't have known. He couldn't have acted otherwise." Was it excusable? The answer is no. And here is where we find out why.

First, according to the distinction between price and value, Anthony should have realized the great discrepancy between the value of a $0.50 and $5 meal, even if he paid only 50 cents. Anthony lived in the city for six years and... While the actual value of things might have escaped him at the start, he would have caught on quickly after some time.

Second, a mental model called Henlon's Razor urges us not to assume that others intend malice in their actions when no sign of malice exists. Without any justification, Anthony ascribed malice to Jan's action of giving him the same meal, not thinking that an innocent and reasonable explanation existed.

Third, another thinking aid known as Charles Munger's checklist compels us to adopt intellectual humility. Anthony's great achievement, though well deserved, got the better of him, and all humility escaped his demeanor.

Fourth, Chris Argyris' ladder of influence equips us with a method to avoid jumping to conclusions. Anthony should have gathered all the facts, carefully screened and weighed them, and analyzed all their implications before deciding to call his only benefactor a cheat.

Finally, well, there is no finally. We can go on indefinitely, definitely naming mental models and practicing thinking frameworks that could have prevented Anthony's lapse of judgment. Unfortunately for him, Anthony did not know about them. Luckily for us, we can learn about practical thinking frameworks and mental models in the chapters that follow. I invite you on a trek to discover what mental models are and how they can help us avoid judgment errors and improve our decision-making. The next pages will hopefully both enlighten and entertain us as we acquire the tools to help us lead better lives.

With high hopes, let's turn the page and begin our journey together.

Diana Jean P. Aquino

For Noel, Arnold, Bernadette and Charles.

1. How can we become better thinkers and great decision-makers?

Blind Lady Justice.

My father, Arnulfo, was an astute lawyer who was a stickler for the proper use of words. He also had a penchant for discussing abstract ideas in a down-to-earth manner. Once our rambling talks led to the topic of decision-making. "'Dad,' I said. 'Are choice, decision, and judgment the same? I'm writing an essay, and I need synonyms for decision, so I don't keep repeating the same word. I had already consulted a thesaurus that listed the three words as synonyms, but I needed a second opinion.'"

"'Choice, decision, and judgment? Of course, they are not the same!' he exclaimed with his usual brio. 'I would say they differ with respect to degree or weight of importance.'"

"Huh," I thought. He went on. "Here's an example. Your mom had several suitors, and of all those suitors, she saw how handsome I was and chose me to be her steady boyfriend. That's a choice. During our courtship, she found me pleasant, charming, of superior intelligence, but most of all, someone who could get along with her parents. Then she decided to accept my proposal to marry. That's a decision. So, where's the judgment?'" I asked.

"'That is something I am subjected to every day of our married life,' my father grinned. 'You see, a judgment is rendered after close scrutiny, careful consideration, and the finality of its consequences. That I am still in one piece after four decades means that your mom has passed favorable judgment over me.'"

I asked him one more thing. "Then should Lady Justice not be blindfolded so she can see everything?"

Dad straightened up and assumed a serious demeanor. "The blindfold is not against the facts and reason. It is against emotion and prejudice. It means that justice has no prior knowledge or opinion about the issue whose evidence, both in favor or against, is being weighed in the scales," he added pensively. "Actually, justice was depicted by the ancient Greeks as a lady, the goddess Themis, who was known for being clear-sighted and fair. So, she didn't even need the blindfold. And in that sense, you are right."

What most people tend to do: Choice, decision, and judgment all involve the same mental activity, which is weighing several alternatives and making a selection from among them. Based on our customary usage of these terms, their consequences may vary in degree. Choices are made more frequently and, therefore, are less consequential than decisions or judgments. Of the latter two, judgments are more serious, have longer-term implications, and are therefore more consequential. Decisions would be somewhere between the two. In most academic literature, the three are used interchangeably.

According to Beresford and Slopper, choice is the outcome of a process which involves assessment and judgment; that is, the evaluation of different options and making a decision about which option to choose. In a one-sentence definition, the authors included choice, judgment, and decision, involving all three in a single process.

Different authors categorize thinking into different types, but there are two basic types commonly associated with the decision-making process: System 1 or intuitive, and System 2 or analytical thinking processes. Intuitive System 1 thinking is best described as an unconscious mental response that is mostly independent of language. It is decision-making that is automatic, quick, and effortless, and executed with a strong feeling of certainty. Analytical thinking is more deliberate and time-consuming. It is a belabored and incisive process, and a decision is only arrived at after all the issues involved are debated and examined.

Both types of thinking are useful in specific circumstances. Thank you. Those who prefer System 2 thinking are more adept at resolving problems requiring depth analysis, the solutions of which are typically more costly to implement and have longer-term repercussions. Which system of thinking is better? The answer is both, depending on the time, place, and circumstances.

What differentiates poor thinking from good thinking?

"Cogito ergo sum. I think, therefore I am." René Descartes, the 17th-century French philosopher, mathematician, and scientist, argued that people who doubt their existence have, by their doubting, already resolved their doubt because doubting is thinking, and thinking is proof that one exists. Now, before we get dizzy thinking in circles, let's get a hold of ourselves and accept that we all think. Thinking is an activity of the free mind, something we can never be forbidden to do, nor can the contents of our thoughts be externally controlled. Because thinking is the expression of the self, we are sovereign over our own thoughts. That is why we are each entitled to our own opinion. It is an absolute truth that we all think because we all exist. However, it is not true that we all think alike.

Like a ship in the vast ocean, the mind is free to wander. But as the safety of the ship's journey and its timely arrival at harbor depend on the skill of its captain, so too the quality and usefulness of our thoughts depend on our skill as thinkers. In the following table are the attributes of good and poor thinkers, identified by many anonymous teachers through the years.

Good thinkers are tenacious and preserving. Use thinking skills purposefully and precisely. Often plan their thinking. Pool analogy. Maximize and optimize the given time. Fit activities into the available time. Gather many ideas. Fluency. Gather different ideas. Flexibility. Use elaborative thinking. House analogy. Enjoy and embrace challenges to their thinking from themselves or outsiders. Value information. Sponge. Recall information easily. Our good observers. Enjoy struggling with a problem or idea. Are self-evaluating before, during, and after their work. Employ planning, monitoring, and reviewing of results. Value thinking more than intuition. Value the journey or process. Tolerate uncertainty or ambiguity. Revise goals when necessary.

Poor thinkers give up too easily, use thinking sporadically, inconsistently, or unsystematically, and do not plan their efforts. Use time poorly. Time given is either too much or too little. Gather limited ideas. Use basic thinking along with simple tenets. Avoid challenges and choose the path of least resistance. Do not value information. Forget information easily. Are indifferent to their surroundings, are satisfied with their first attempt, lack self-evaluation either before, during, or after their work. Do not plan, monitor, or review the results. Overvalue guessing and intuition. Value the destination or completion. Value certainty and comfort. Retain initial goals regardless of process.

Distinguishing between good and poor thinkers. Are there qualities in these lists that you think apply to you personally? It is likely that, on most occasions, we exhibit the traits at the right, but for decisions that are of grave importance to us, we instinctively choose to follow the traits at the left. So, all of us may act either as good or poor thinkers at different times when we make decisions. The teachers who contributed to this list did not judge their students as good or poor thinkers, but identified the habitual behavior of students who performed well and those who did not. Reliable as they are, these are merely indicators. There are no hard and fast rules that can fully define good thinking.

In fact, we do not make most decisions logically. Cognitive researchers have established three robust facts about human reasoning: One, all people, even those without any training in logic, can and do make logical decisions, even about abstract things not encountered in daily life. Many of our puzzles and mind games, such as crossword puzzles, Sudoku games, and scrambled letters, require abstract problem-solving that has little to do with our daily tasks. Two, individuals strongly differ in their ability to reason, and this ability is closely related to measures of academic achievement. Therefore, they often serve as measures of intelligence. Three, almost all sorts of reasoning, for example, two-dimensional spatial inferences, or more complex reasoning based on sentence connectors like "if" and "or," are computationally intractable, meaning that they involve problems for which no logical or mathematical rules, like algorithms, can be formulated.

The third fact has remarkable implications. The researchers found that there is no algorithm that exists that can recover the logical form of all everyday assertions. In short, many of our thoughts exist, hazy or cloud-like, without a definite structure or form, and yet can be effective thinking tools. Isn't that proof of the astounding complexity of the human mind and the magnificence of its creator?

Effect of time and cognitive content on the quality of thinking.

"The happiness of your life depends upon the quality of your thoughts." - Marcus Aurelius

So, can a person improve the quality of their thinking? There is no rule against it, and our minds are so complex and powerful that who knows their capability? By closely examining the table of good and poor thinking habits, we can arrive at a generalization about how we can improve the quality of our thinking.

First, we should understand that we ought to stop equating our minds with our brains. The brain is a bodily organ. It is a physical thing. The mind exists in the realm of the metaphysical. It is abstract, of a non-physical nature, and yet accounts for so much of our physical bodies. Many people often say "you have a good brain" when they mean to say "you have a good mind."

We regard Albert Einstein as one of the greatest thinkers not only of our time but in the whole of history. He is so well known for his intelligence that his name has become an adage for an extremely intelligent person. In 1955, Einstein died at the age of 76, but his story does not end there. In Princeton Hospital, where he died of a burst aorta, his brain was immediately removed. Stolen, as it were, by Thomas Stoltz Harvey, the pathologist who conducted his post-mortem examination. Harvey took the brain without permission from either Einstein or his family, and against the wishes of the deceased. In fact, Einstein left behind specific instructions for his remains to be cremated and secretly scattered to discourage those who wished to idolize him. It was evident that Einstein did not want to be studied or given any special treatment.

As was expected, Einstein's son, Hans Albert Einstein, was initially infuriated at the incident. After some time, with permission, Harvey turned the brain over to researchers on the condition that the findings be published in highly reputable scientific journals. Albert Einstein. And what were those findings? Well, there were several studies, each with its own findings. There appeared to be differences in the dimensions, weight, external surface characteristics, and other physical properties of Einstein's brain compared with those of other random average adult males. However, the findings were not conclusive because: One, the normal brains used may not have been the best for comparison with Einstein's brain. Two, Einstein's brain was the only one in the experimental group, while the control group comprised of several brains. So there is an inconsistency in the group's sizes. And three, only a small portion of the four areas of the brain was studied, which could not be the basis for a reliable conclusion.

Einstein's brain was different. It was unique. But then, so are the brains of every individual who lived. It appears that Einstein's brain is no different from all other brains in its uniqueness. What, then, makes one a great thinker? Apparently not the qualities of the physical brain. Therefore, it must be the way we use them. Just as bodybuilders work out at the gym to develop their muscles, we must exercise our brains by challenging ourselves to learn, observe, analyze, and examine. To think.

Let me introduce you to an excellent thinker.

The Thinker by Rodin.

What makes my thinker think is that he thinks not only with his brain, with his knitted brow, his distended nostrils, and compressed lips, but with every muscle of his arms, back, and legs, with his clenched fist and gripping toes. A goose rodent. Famous around the world, The Thinker was intended as one piece of a grander sculpture, The Gates of Hell, a depiction of Dante's Inferno. It was originally entitled The Poet, an obvious reference to the famous Italian writer and philosopher Dante Alighieri. The Gates of Hell was supposed to be the doorway to a museum that was never completed. Instead, the image became an independent work, showing a tortured body but a free-thinking man. The Thinker is the embodiment of profound contemplation. As Rodin himself described it, "Every fiber of this man's mental and physical being portrays the deep thought. Time stands still. His thoughts are intense and seminal."

Quality thinking is not an idle activity. It does not allow the aimless meanderings of one's mind. It is not daydreaming or entertaining wishful imaginings.

Learning the basics and sharing our knowledge.

"Try to learn something about everything and everything about something," is a quote attributed to Thomas Huxley, a prolific scholar, writer, and teacher. Huxley dealt with divergent topics such as religion, philosophy, social issues, and numerous biological fields. He received a scholarship in medicine but failed to complete his studies because he was deeply in debt. He also lacked a formal education, nevertheless taught himself the natural sciences, including paleontology, zoology, geology, and botany. He also learned mathematics, physics, mechanical engineering, the German language, and drawing, among many other subjects. He wrote a series of papers collectively entitled Evolution and Ethics, which was much involved in the debate between science and religion. Huxley was later elected president of the Royal Society, and among the many awards he received was the Darwin Medal.

Huxley was not gifted with superhuman powers, at least no more than Einstein. But one thing was common between the two: they both had a love of learning. "I have no special talents. I am only passionately curious," Einstein said of himself. They both had an intrinsic motivation to discover new things, and they were methodical and relentless in their motivation. Like Huxley, Einstein taught himself physics. He cut classes and played hooky so he could tailor his learning to a specific interest in physics. They were both methodical in their learning and sought to understand those things they were motivated to learn about.

The knowledge one person acquires is of little use if it is not shared. There are many informal ways of sharing knowledge, the most enjoyable being simply conversing with others in casual gatherings or over cups of coffee. In more formal settings, such as organizations, we can share knowledge more efficiently through several suggested approaches. Management could encourage and foster an open mindset for new insights among the staff and create space for sharing within the organization. These may include team brainstorming and springboarding innovation proposals. Management may invite experts to share their knowledge at seminars. Managers and other senior staff can lead by example. More importantly, the organization may adopt effective tools to facilitate knowledge transfer.

Decision-making is a skill. Having the right mental tools or frameworks is just one aspect of decision-making. The other necessary element is having the skills to use the right tools to arrive at the best possible decision. Having a skill is more than possessing knowledge. It includes using that knowledge to do something exceptionally well. That is to say, something concrete and of good quality materializes out of the effort put into an activity. Honing a skill takes repeated practice, patience, critical evaluation of your work, and judicious use of the tools needed for the activity.

As a boy, John watched the handyman repair parts of their house and was intrigued by the carpenter's methodical use of the hammer, saw, squares, measures, and levels. He marveled at the neat woodwork that came out of it, such as window frames, cabinets, and doorways. The little boy John decided he wanted to become a carpenter. Like most of us who turn out to become something other than our childhood dreams, John became an accountant. One day, thinking he would still like to become a carpenter, he went to the nearest Home Depot and got himself the latest power tools: saws, grinders, drills, routers, and the hand tools he saw the carpenters use. He even bought the wood and nails needed for his first project, a coffee table. Alas, even with the instructions downloaded from the internet, he ended up with an imbalanced table that collapsed into pieces when he placed a moderate load on top.

Developing one's skill in making decisions requires frequent practice under challenging situations. Obviously, some routine decisions do not require much effort, such as what to order from the restaurant menu, what to wear for the day, or what television show to watch. The decisions which require more careful study are the life-changing ones, such as the career to pursue, the person to marry, or the place to set up your home or business.

Decisions that change our lives.

When Angelica turned 13, the magic age when she officially became a teenager, she took it into her mind to style her hair by herself. She had her plan from her mother because she knew the latter would disapprove. Anyway, she thought, "Mom can't do anything about it once it's done." Bangs across the forehead was the fad then, so she took scissors and comb and began her initial foray into hairstyling. How hard could it be, after all? Just cut the hair straight across the forehead. The problem was, she cut the left side shorter than the right, so she tried catching up on the right side. Alas, that side turned out to be even shorter, so she went back and did the left side again. Ended up with, you guessed it, bangs that were much shorter than she intended. Mortified, Angelica wailed, "My classmates will laugh at me." Her mother tried not to laugh. "Don't worry, it will grow longer in a couple of months. That's what's good about hair. It eventually grows out. So, you learned something today, didn't you?" Angelica thought, "Yes, to experiment with new hairstyles during the summer break when school's out." Angelica's mother was right. She tells herself the same thing when her stylist dyes her hair and she doesn't like the way it turned out.

We make decisions every day, some good and others not, but our attitudes cannot be flippant when the decision to be made is consequential and affects our lives profoundly. For important decisions, sufficient time and careful study are needed.

Diverse mental tools and good decision-making.

My grandmother is a learned woman. She got her bachelor's degree in education and taught English in the old country during the last great war. When she married and raised her brood of seven, she took lessons in home economics and practiced her culinary, homemaking, and child-rearing skills in a home that produced accountants, doctors, and lawyers. Grandma was a modern woman of the '50s. But before she made any important decision, she did something without fail: she consulted her fortune teller. Madame Esperanza, whose professional name coincidentally meant hope, would search through her client's palms. She would then lay out her tarot cards, turning them over one by one and gently murmuring, "Hmm, hmm." Then she would pronounce the best date for a wedding, whether a trip abroad was opportune, or if investment in a piece of property would yield gains.

Making decisions, particularly those that involve significant risk, sizable material or sentimental value, or upon which rests our future, is more than just an intellectual process. It involves a degree of emotional investment, to the end that the decision-maker is assured and at peace with the decision. If my grandmother decided to consult an expert with a "third eye" after thinking through the problem and making a studied choice from among the alternatives, she did it to build confidence in her decision. But she didn't follow the advice blindly. She explained once how the fortune teller told her to schedule her son's wedding in the morning for good luck, but they still went with the late afternoon schedule. "Somebody else reserved the morning slot at the reception venue. I mean, be practical. Fortune tellers don't know everything."

There are, therefore, social, cultural, and religious practices that influence our decision-making, and while they are not entirely logical, they have a place in our consideration. Like my grandmother, these practices are only a small part of the larger decision-making framework. The core of decision-making remains with the essential elements, the key factors. In preparing for a wedding, the "where," "when," and "how" could be incidentals. The "who" and "why" are the essentials.

Barriers to Effective Decision Making.

Many reasons stand in the way of sound decision-making. We shall focus on five of the more salient barriers: bounded rationality, constraints in time and resources, escalation of commitment, personal biases, and conflicts.

Bounded Rationality.

From its very name, bounded rationality refers to the concept that "I cannot think of how to work this problem out. I am just not ready to make this decision." We have all come up against this barrier at one point in our lives. We may have found ourselves in one of the following situations: Faced with opposing players on all sides, a rookie basketball player in an important game panics. "Should I pass or shoot? The coach is shouting something at me. What is it?" Distressed by her crying infant, a new mother asks, "I've fed him and changed him. Why does he keep crying?" A fast-food crew member flooded with customer orders on the first day of his job ponders, "Wait, did he say small or large drink? With cheese or without? Why does she have to talk so fast?"

Whenever we encounter a problem that we have not experienced before, we may feel unprepared to make a decision. Whatever decision we make, we just don't know what the consequences will be. We feel that our brain is too small to contain all the information that is flooding in all at once, or if we are even gathering all the pertinent information. We end up making a totally irrational decision. We opt for suffering or doing the best we can given our limitations, rather than thinking it through to arrive at the best decision.

Reportedly, the term bounded rationality was formulated in 1947 by Herbert A. Simon, an American political scientist and economist, and 1978 Nobel Prize awardee. Simon observed that people are only partly rational, and when they are rational, there is a limit to their rationality. Many things can influence our ability to reason, such as heuristics and biases, which kick in when we are unable to properly process the information we have.

Time, Resource, and Information Constraints.

Bounded rationality occurs when we face a situation that we feel we are not competent to handle. But what if we face problems that we are used to handling, except that the time needed to decide is too short? Or the available resources or information are not sufficient? Then, this also constitutes a barrier to effective decision-making. Managers often find themselves in a position where they need to make an important decision under unexpected conditions.

The Sun Valley Mall has been in existence for 30 years and within that time has achieved the status of a first-class, ultra-modern establishment. The mall has all the safety features required for large businesses with high customer traffic. Management has developed a protocol for all possible contingencies, such as earthquake, flood, and fire. But on one occasion, when a maintenance crew was setting up the Christmas display after store hours, a short circuit blew out a set of light bulbs situated close to the decorations of flammable material. The flames quickly spread in that area and through the ceiling that was inaccessible to the sprinkler system. Since this occurred off-hours, all managers and staff were at home, leaving only the maintenance supervisor as the most senior staff on location. By the time the senior manager arrived at the scene, flames had already engulfed a large portion of the structure. Much of the store's valuable inventory was damaged, if not by the fire, then the water used to douse it. The supervisor did not activate the necessary protocols which should have automatically gone into effect, and there was insufficient time, resources, and information for the senior manager to make the crucial decisions that would have prevented the fire from spreading. Had the regular managers and personnel trained in the protocols been on duty when the fire broke out, then they might have contained the damage earlier by making more timely and accurate decisions.

Escalation of Commitment.

It's not surprising that people frequently make decisions that may appear to be the best choice at the time, but later turn out to be wrong. When new or more complete information becomes available and shows a previously made decision to be wrong, then it should be rectified, even if it means admitting that it was a mistake. Escalation of commitment is the tendency of a decision-maker to remain committed to a wrong decision that they had to make earlier.

A typical escalation of commitment situation develops when a stock investor, let's call her Penny, falls in love with the stock she chose to invest in, believing that its business will pick up in the future. Contrary to her expectations, the company whose stock Penny bought performed poorly, and its stock price began to fall on the market. Pragmatic investors know that when the company's fundamental business sours, it's time to cut losses and sell the failing stock. But Penny has developed a sentimental attachment to her stock and escalates her commitment to it. Not only does she not sell her failing stock, but buys more of it as the price goes down. Penny makes an irrational decision to lose more money on this investment, rather than switch to another stock. She insists on believing that the stock's price will rise again, not accepting that the company has lost its worth. When the company finally declares bankruptcy and its stock has become worthless, only then will Penny realize the folly of her decision.

Personal Biases.

Most organizations prepare for all possible contingencies but find themselves unprepared to deal with crises that arise out of the blue. Toyota, the car maker with one of the most popular brands globally, found itself in this predicament in 2010 when it recalled 7.5 million vehicles and suspended the sale of eight of its best-selling models due to safety design problems. The situation proved a great embarrassment because Toyota was practically synonymous with safety and quality. The problem began developing in 2009 when some of its cars were involved in serious road accidents that resulted in death. To make a long story short, the company tried to ignore the hundreds of complaints and growing statistics of fatal road mishaps involving Toyota vehicles. It operated on the biased belief that attributed no fault to flaws in its production process. Only later on did its management realize that putting off acknowledgment of an internal problem and believing that the mistake was made by external parties—suppliers, dealers, even consumers who patronized their product—compounded its problem. It was only when Toyota's CEO, Akio Toyoda, apologized before a House committee that investigated its flaws that the company admitted that its design errors had compromised the safety of its cars.

A company's CEO is partial to their company, as is each and every manager, engineer, factory worker, and utility personnel. This is called loyalty, and it's not bad. We each have our own biases towards our employer, school, country, family, friends. This partiality is tribalism, and it was needed for humans to survive in prehistoric times. Current research suggests that an evolved form of tribalism is a necessary survival strategy even at present. As long as these biases are not challenged in the decisions we make, there is no problem. But when our emotional attachments interfere in our objective assessment of a problematic situation, these biases may become a barrier to arriving at a good decision, let alone the best decision possible. Despite the overwhelming evidence of their culpability, Toyota could not admit that it failed and chose to believe that its quality assurance was infallible. They refused to halt sales and recall vehicles in due time to prevent additional unnecessary deaths. If you find yourself in this predicament, that is, being unduly partial in making a crucial decision, the best option would be to rescue yourself from the duty of making that decision. Instead, you should pass it on to the next qualified person, if that is possible. If recusal is not an option, then find an objective and trustworthy advisor who will help you think the problem through.

Conflicts.

Have you heard of a new phenomenon in larger business organizations called "decision spin"? It's a phrase coined by Ron Ashkenes for a phenomenon wherein a company's planning and decision-making process involves a lot of meetings, discussions, committees, PowerPoint decks, emails, and announcements, but very few hard and fast agreements. With decision spins, the decision-making process is passed around from group to group, from one level of the hierarchy to another, and across the organizational structure. During this time, the details and consequences change with each input from different stakeholders. The result? A decision that is a non-decision. The whole process simply ensured the aversion of potential conflicts.

Making the right decision can be difficult when it is likely to trigger conflicts with other people. Standing by our decision means that you will likely stand against those who are for the contrary alternatives. Therefore, people naturally tend to decide on a course of action that can accommodate, as far as possible, the concerns and interests of as many parties as possible. More often than not, to keep the peace, people with better proposals may shy away from expressing their views to the detriment of arriving at the best decision for all.

Philip chaired the business administration department of a large university. Every year, he authorized the books to be ordered for the students enrolled in his department's college programs. When he assumed his position, students complained to Philip that they had to buy expensive books and hardly use them throughout the semester, while they could source the substance of their lessons from the internet. They asked Philip to revise the list of required books, eliminate those that were not needed, and opt for less costly alternatives for those required. Immediately, Philip conducted a review of the book list, sending it to the faculty with a request to eliminate as many as possible and reconsider lower-priced books. However, the same list returned unchanged, with a note from the faculty union leader that all of the books are necessary, and a reminder that the faculty have the final say in the composition of the book list. Perturbed, Philip conducted his own quiet investigation, discovered from the book supplier that the faculty enjoy a 20% commission on the books they ordered for their students. Philip sensed that if he ordered the change in the book list to align more with the students' request, he would be met by a mutiny of sorts from the faculty. It is true that the rules allow faculty members to specify the books their students need to purchase without further need for explanation. Wishing to avoid a major conflict with the faculty union, Philip authorized the book list as it was. The students silently complied, intimidated by the prospect of a possible failing grade from the faculty. In the end, a decision was defaulted to avoid a conflict.

The Key to Making Good Decisions.

We can condense much of the discussion about good thinking and decision-making into a few key principles. First, competence in making good decisions requires us to develop decision-making as a skill, including the use of diverse mental tools. A skillful decision-maker possesses a set of powerful mental tools, the knowledge of when to use them, and how to acquire the requisite information to use them. Second, the barriers to good decision-making must be eliminated, which means we must first recognize them. This brings us to the third key: experience. Gaining enough practice and assessing information using the proper models, recognizing and removing the barriers, and pushing through with the decision are activities that we must perform with regularity until the skill becomes like a sixth sense to the decision-maker.

Action Steps.

The table describing the characteristics of good and poor thinkers includes a list compiled by several teachers based on how they observed their students. The characteristics describe thinking habits rather than making categorical judgments on individuals. Go through each item and objectively try to identify which of them is reflective of your own habits. Be honest with yourself and do not justify where you are failing. Just recognize that these habits exist. For every characteristic of good thinkers that, in your assessment, describes you, remember to maintain and build on that trait. For instance, if you are already systematic in your planning, ensure that you continue to make this a habit for the larger problems you encounter. On the other hand, for every characteristic of poor thinkers that you think reflects on you, take note of this trait and try to avoid future actions that manifest them. If you feel that you tend to forget information easily, develop a system, such as keeping a journal or tickler at hand, wherein you record important information. Remember that nobody is an inherently good or poor thinker. We can always work to improve our habits if we are aware of them.

Moving on, the ability to think differentiates human beings from the rest of the animal kingdom. The quality of our thoughts determines how well we decide and act on the challenging situations that confront us. At times, we have to decide and act quickly, particularly during crises. But more often, we have the time and means to gather the necessary information and make the best decision possible. In the next chapter, we will learn how we can use mental models as our thinking tools.

Key Takeaways.

* People generally rely on two types of thinking: intuitive or System 1 thinking, and analytical or System 2 thinking.

* There are character traits that poor thinkers and good thinkers are prone to have.

* Gathering quality information and spending more time on analysis improves the quality of our thinking.

* The greater the number and diversity of the mental tools we equip ourselves with, the better decisions we can make.

* Bounded rationality, lack of time, resources, and information, escalation of commitment, personal biases, and conflicts can hamper effective decision-making.

2. The role of mental models in thinking and decision-making.

As a mother and a teacher, I have developed the compulsive habit of telling stories, and my children Arnold, Bernadette, and Charles were my captive audience during their childhood years. One story I frequently told was "The Fisherman and His Wife," a traditional children's tale. My version had the fisherman's repeated summons to the magical fish: "Flounder, flounder in the sea, Prithee hearken unto me, because my wife, Penelope, wishes for something that should not be." It was, after all, the story of a fish that granted wishes.

The years passed, and my children grew into young adults. One time, Arnold, Bernadette, and Charles were seated across the dinner table from me, and we found ourselves recalling old times. "Remember the story I used to tell you?" I said, and I began to retell "The Fisherman and His Wife." As I began to tell the story, Bernadette, seated between her brothers, displayed a peculiar change in facial expression as I said, "Flounder, flounder in the sea, prithee hearken unto me, because my wife Penelope wishes for something that should not be." Much amused at her facial expression, I said to my daughter, "You don't remember the story, do you?" And she candidly replied, "It's not that, Mom. I thought we were telling the story of The Little Mermaid." Yes, the Disney film does have a flounder, but an aerial instead of a Penelope.

"How remarkable," I thought. There were three individuals whom I had raised and told the same story to, but whose thinking shifted into different mental models when hearing it again after a long time. It so happened that the boys, Arnold and Charles, are good listeners and remember the story as they heard it. On the other hand, Bernadette retains visual images more effectively, so she recalled the Disney movie more quickly at the mention of the familiar character, Flounder. This story illustrates how personal mental models are formed and that, ultimately, the correctness of the model we choose... depends on its suitability to the information received. This is also an example of the workings of availability bias on a person's preference for certain mental models. We will discuss more on the impact of biases later. Let's tackle the basics first.

What are mental models?

A popular children's hobby, at least during the age before video games, is model building. Model airplanes, cars, houses, trains, ships, rockets, and even scale models of actual architectural structures or mechanical devices. From this simple recollection, we may easily describe models as representations of something else. If you see a miniature plastic souvenir in the likeness of the Eiffel Tower, then that model makes you think of the real Eiffel Tower in Paris. Similarly, the 5-inch long toy Ferrari model displayed on a hobby shop window is a replica of an actual Ferrari sports car. You may recall your teacher using balls, string, or wire to build a representation of the atom or the solar system in your school days. These are models of real physical entities.

Not all models are physical. There are abstract, descriptive, and analytical models. Some models are mathematical in form, others are graphical or illustrative. These latter types are conceptual models or representations of how we view the world. They are thought patterns of how we understand reality. Thus, mental models are uniquely our own because they embody our perceptions, experiences, and comprehension of the world around us.

Let's see how this applies to Arnold, Bernadette, and Charles. Arnold and Charles recalled the same life experience from their youth, and therefore summoned in their recollection the same mental model: our version of the fisherman story that was consistent with the mention of Flounder and Penelope. On the other hand, Bernadette heard "Flounder" and called upon a different mental model, that of the Disney movie that had a flounder but no Penelope. So, some of the information in the story I was telling did not fit her mental model. If a fourth listener were familiar with the original version of The Little Mermaid by the Danish storyteller Hans Christian Andersen in 1837, that person would not even understand the connection between my story and that fairy tale. Why? Because there is no flounder in that story, or rather its English translation, as the original was in Danish. There again is another mental model.

The mental models existing in our minds mold our thoughts about stimuli or information we receive. Since ideas or concepts exist in the mind, then some tangible representation of them exists to communicate them to others effectively. Models therefore provide a means of expressing our abstract thoughts. While mental models begin as our own unique formulations, we are to transfer them into the minds of others, thereby establishing a connection with the others by which we share the way we think. Mental models are our tools of understanding, so by gathering more of the mental models that others have created, we expand our own toolbox or skill set to better grasp the world around us.

Consider a mental model developed by Albert Einstein, whom we discussed in the preceding chapter. As one of the world's greatest thinkers, Einstein definitely had ideas no other person in the world had before him. The most popular is the theory of relativity, the mental model according to which Einstein viewed the universe. More specifically, the theory of special relativity described how space and time are connected, and the Theory of General Relativity, published ten years after, expanded this connection to include gravity. Before Einstein published his

Theory, nobody had any understanding of the relationship between gravity, time, and space as Einstein conceived it. After his theory was published, discussed, challenged, and accepted by the scientific community, it became a useful tool. The theory of relativity facilitated space travel, as well as the invention of the cathode ray tube for television, the radar gun used for military, sports, and giving out speeding tickets, and the Global Positioning System, or GPS. Things we now take for granted.

Einstein's mental model expanded the decision-making skill sets of countless researchers, scientists, inventors, engineers, technicians, and the entrepreneurs who brought their products to the market. Why do we use mental models? First and foremost, the purpose of using models is to convey an abstract idea. Our thoughts are abstract and internal. We see them with our mind's eye and understand them at a conceptualized level. But there are other reasons why models are not only useful, but necessary.

There are many reasons for using mental models, but we will discuss four to simplify complexity, to process new information, to shape how and why we think, and to understand life. Before we proceed, let us prepare an illustrative case for our discussion. Consider the situation of 18-year-old Juliet, a lovely young woman who married Romeo, a billionaire old enough to be her grandfather. They met and courted for only three months before deciding to tie the knot. Juliet outwardly professed her love for Romeo, but admittedly, she expected to inherit at least a sizable portion of her husband's wealth at some future time. Romeo's grown children were against the marriage. Still, he was adamant in his decision to marry his bride, stating he deserved to experience some happiness before he left this earth. On their wedding night, Juliet gifted her beloved Romeo with such an ecstatic honeymoon experience that the old man's heart gave out and he died of wedding bliss. An heir of "I told you so," Romeo's children alleged that she committed a crime and should not inherit his wealth. The problem to be decided is, did Juliet commit a crime?

The Need to Simplify. We can simplify the complexity of an abstract thought by rendering it in the form of a mental model that identifies and describes its central components and how they relate to each other. The mental model gains the form of a diagram, statement, mathematical equation, or other similar devices and is thereby reduced to its basic elements that are easily understood by others. One aspect I greatly appreciated in the study of criminal law is how it breaks down crimes into their essential elements. A layman's understanding of a crime would likely be that it is something bad or should be punished. Unfortunately, if that were all, then practically everything we did would be punishable as a crime, such as overeating, which is bad in a sense. Even thoughts that were bad would deserve punishment.

But legal theory created a mental model of a crime by defining its essential elements, of which there are three. First, a crime is an act or conduct. This alone would exclude all thoughts, motivations, or intentions that were not acted out. Second, a crime requires that the individual committing the act had intended to do harm, called *mens rea*. This requirement, therefore, excludes all acts that caused harm but were unintended. Last, a crime requires that the wrongful act can forcibly provoke the effect, called proximate cause. The last element excludes all acts that were intended to harm, but their relationship to the harmful effect was too remote or far removed. If any one of these three essential elements is missing, then there was no crime committed.

In the ordinary sense of the word, one could say that the events were so unfair that they constituted a crime. But the mental model set in the law is clear and simple. Element 1. An act that was committed is present. Element two, that a criminal intent was present, is not fulfilled because Juliet's intent to inherit at some future time is not unlawful. In fact, it is legal. Element 3, that the act of Juliet in performing her wifely duties was the proximate cause of her husband's death, is debatable. Unless a doctor strongly advised against this activity, one could not say with certainty that it was foreseeable. Based on this simplification of the concept of a crime, Juliet's acts are far from criminal. The decision is easily in Juliet's favor.

The Need to Process New Information. We constantly receive new information, requiring us to receive, filter, and store masses of data from our environment. In resolving a particular problem, however, not all available information is necessary. A mental model provides a guide by which we may assess and select only those pieces of information that are relevant to making the decision. Let's go back to the case of Juliet. In the narration above, there are many bits of information that Romeo's children probably thought were relevant because they cast Juliet in a bad light and made sure to highlight them. Juliet is only 18 years old. She and Romeo only knew each other for three months before deciding to marry. Juliet admitted that she expected to inherit Romeo's fortune, and she intentionally seduced Romeo on their wedding night. Each of these allegations, even if true, should be filtered out as they do not fit the mental model that defines a crime. The bride is of legal age, validating their marriage. The length of time of their courtship is immaterial. Her expectation of inheritance is consistent with the law. So, too, is a married couple having sexual congress. None of these are material in proving the three elements of a crime, so they are not pertinent in the analysis.

The Need to Shape How and Why We Think. The use of the right mental model helps us shape more cognate opinions about things that other people will take seriously. Before we knew about the essential elements of a crime, our reasoning for favoring one side or the other would have been arbitrary. Some might argue emotionally, compassion for either Juliet or Romeo's children, and others ideologically, whether the matrimonial or paternal bond is stronger, or from any random perspective, all of which are likely to lead nowhere because they fail to logically deal with the question: What makes an act a crime? Being guided by the legal model shapes the forms and substance of our thoughts to lead us to a relevant conclusion.

The Need to Understand Life. Ultimately, employing the right mental model for the right reason and circumstances enables us to view life's situations with greater clarity. Mental models make us see things in relation to one another without the influence of irrational biases or fallacious reasoning. They establish a general thought pattern anchored on the logical relationships of things. What identifies a crime is the act, the intent, and the casualty. If one of these is absent, the act is not a crime. That simple model helps us to understand at least one aspect of life, reducing our understanding of the nature of a crime to its simple terms without the surrounding complexities. If we could replicate this process regarding those issues surrounding our problems, then we could most expediently arrive at the decisions that would yield the best results.

Why should we learn how to use mental models? There are three fundamental purposes for learning to use mental models: to compensate for weaknesses in our reasoning, meet society's demands for specialization, and take the fullest advantage of the social space in which we move. Mental models compensate for frailties in human reasoning. Humans are imperfect. Even those of us who were exceptionally good thinkers make occasional mistakes. We are lucky if the mistake is small and if its effects minor. Unfortunately, some mistakes might end up having serious consequences. The more established mental models are thinking patterns validated over time by experts in different fields and known for their accurate results. When we rely on established models, the better judgments of the experts who formulated them and the authorities who corroborated them guide us. We are therefore less prone to the frailties of our own unassisted reasoning.

Our society demands specialization. We are the best judges of the decisions involving our personal affairs, but decisions made in the context of the broader society must suit their public purpose. The complexity of our way of life demands that for us to make a useful contribution to society, we must be experts at what we do. Gone are the days when half measures could get us by. In this day and age of almost unlimited information accessible in real time, there is no excuse for mediocre performance and decision-making within the sphere of our competence. And yet, focusing only on our area of expertise creates a disconnect between ourselves and others, making us irrelevant to the rest of society's concerns. At times, we may be too knowledgeable on one aspect of a thing and oblivious to other related aspects.

One day, I turned on our cable television only to find that the audio was not working. The video was great, the picture was sharp, but there was no sound. I called the technical service for advice, and Sasha, the lady at the other end, ran me through a rigmarole of instructions: Detach the cable from the television. Reattach the cable. Push this button and flip that switch. What does the reading say? Let's do step six. Go back to step one. Exasperated, I told her to just send over their repairman. She said, "It's going to cost you." It didn't matter after 30 minutes of following instructions that seemed made up. Ernie, the repairman, came two days later. That's two days we suffered through silent cable shows. He apologized, saying he had a huge backlog. It seemed many other customers didn't get anywhere with Sasha either. Ernie inspected our television cable while listening to my narration of our problems. Two minutes into it, he said, "I know, let's try something." He unplugged the TV and cable from the wall, engaged in some small talk with me about our Yorkies (a dog lover too), and 30 seconds later, replugged the devices and turned them on. Bingo. Sound.

"Every once in a while, preferably every evening, power down your devices completely. Don't leave them plugged in, or else this happens," Ernie said. But why didn't Sasha, of technical services, just simply tell me that, instead of reading me the whole repair manual?" I asked. Ernie grinned. "Those software and electronics engineers don't know simple troubleshooting. They think all problems are big ones. Me? I'm just a technician." And so I gave Ernie, the technician, a very grateful, sizable tip and sent him on his way to the next hapless customer.

Mental models give us the full advantage of our world. The simple truth is that not even the most intelligent person can know everything there is to know about the world around us. Each generation progresses by understanding what those who have gone before have learned and building on that for future generations. Mental models are a significant contributor to this improvement. They communicate what people learn for the benefit of others. Much like Einstein's theory has made possible all the breakthroughs that we have today, mental models help us maximize the benefits of learning.

Characteristics of Mental Models. Early in this chapter, we described mental models as any tangible representations of an abstract concept. Then we proceeded to identify some mental models: a story, Einstein's theory of relativity, the elements of a crime. By this point, many of our readers are likely confused. What differentiates an ordinary thought from a mental model? Mental models are functional. The best mental models are those for which we find the greatest use and application.

Mnemonics are one type of mental model to which we frequently resort. They work by compressing complex ideas into a shortcut that is easy to remember. You might recall how your grade school music teacher taught you how to read notes. She likely would have introduced you to this: F-A-C-E. Every Good Boy Does Fine. All Cars Eat Gas. Good Burritos Don't Fall Apart. Musical mnemonic device. The letters designating the notes corresponding to the spaces and lines of the staff are assigned words. The words, in turn, comprise a short phrase that makes sense, or, in the case of F-A-C-E, the letters taken together make up a word. The mnemonic device becomes a simple representation of a more complex idea; it is a mental model.

Another popular mnemonic is attached to the color codes of resistors back in the time when integrated circuits had not yet replaced discrete electronic devices. Ten colors represented the values of the resistor according to the following code: Bright Black 0, Boys Brown 1, Rave Red 2, Over Orange 3, Three, Young Yellow 4, Girls Green 5, Butt Blue 6, Veto Violet 7, Getting Gray 8, Wed White 9. Color code for resistor values. Depending on the placement of the color bands on the resistor, their corresponding numerical values are each assigned a multiple of 10. Adding up the products of the color value and its place value gives the rating of a resistance in ohms. The electronic hobbyist or technician should therefore keep in mind the value of each color. They do this with the mnemonic: "Bright boys rave over young girls, but veto getting wed." Older electronics enthusiasts remember a naughtier version of this code involving what bad boys do to our young girls and ending with "Violetta gave unwillingly." Like a particular Harry Potter character, one could not say this version out loud in good company. Whatever the version or mnemonic, they were all functional mental models and served their purpose well.

Not all models are so simple. Others have a deeper meaning and even with a whole belief system behind them. We who are more used to Western methods might think certain Asian philosophies somewhat illogical, even superstitious. But we should not be quick to render harsh judgments over the way people arrive at decisions regarding their personal lives or businesses. Take the case of Feng Shui, a traditional Chinese belief system that originated more than 3,000 years ago. The name literally means wind (fēng) and water (shuǐ) in the Chinese language. Taking a closer look at the more salient principles behind Feng Shui, we find, to our surprise, that there is, after all, a method to the madness. Let's examine five of the rules that Feng Shui followers believe should be consistently followed.

First, be organized and tidy. It's something our mothers would say, for obvious reasons. Functioning properly requires order and eliminating all clutter. Feng Shui calls that the flow of positive energy. Second, keep your bed away from the window. Feng Shui suggests that positive energy escapes out the window and you will have trouble sleeping. Positive energy aside, many people prefer not to put their beds against the window for several reasons. For example, rain coming in may drench the bed, headboards may block the free flow of air, where the view out of the window may be more enjoyable if your bed is far enough away to see it. When there is a choice, looking out the window from a distance or a good vantage point is best, and maintaining a practical space in front of windows to open and shut them or draw the curtains is ideal. But when the room is small and the choice is limited, I am sure a bed by the window is much preferable to a bed by the doorway. Third, separate work and rest areas. Very few principles in room appointments are more practical than that. Separating rest and work areas contributes to the orderliness of the living space. Feng Shui advises this in order to get rid of the clutter that contributes negative energy. But removing work items from a place of rest helps our minds to psychologically wind down and achieve a restful state sooner. The fourth principle is to use the Bagua octagon properly. The following is a Bagua octagon.

Traditional Bagua Octagon. The fifth rule is to understand the influence of colors in our home and to use them to our advantage. Colors, as suggested by the Bagua, impact our moods and emotions. Red for passion and energy, white for purity and cleansing, blue for coolness and restoration. We are able to best function with the proper color scheme in our surroundings. Without going into the particulars of this belief system, from the octagon, we note that each of the wedges or trigrams in the map represents the eight areas of our lives. They are also each associated with particular colors, elements, and compass directions. The circle at the center represents the balance of yin and yang, whose patterns are shown as solid or broken lines in each trigram. At face value, the connections made between the natural elements, human activity, geographic directions, the colors, and the seasons appear somewhat far-fetched and slightly mystical. In our modern diverse culture, the West has adopted these connections, which have even gained popularity among landscape artists, architects, and interior designers. Maybe not so surprisingly, since a greater number of prosperous Asians have been investing in properties abroad. Feng Shui principles appear to correlate with the rising housing prices.

Feng Shui is just one of many cultural philosophies that people of a particular ethnicity are guided by in making decisions. Its counterpart in Indian culture is the Vastu Shastra, which originates from India. These models might not be equally useful for all people, however, as there are enough customers in today's modern society who are particular about applying them. Architectural and interior design firms make it a point to study and understand their use.

Mental models are not scientific. Actually, the above statement is not always true. Several models have a scientific nature. Einstein's theory is one of them. What the statement means is that being scientific is not an essential nature of mental models. Many of them are grounded in unscientific, sometimes seemingly illogical foundations. As we pointed out, Feng Shui is a functional model, but it is also an unscientific model because its beginnings are rooted in Chinese philosophy. The model is not only limited to the use of the Bagua map, but it also has implications about energy levels associated with color, which constitutes the fifth key principle. Check out the following diagram that provides the effects of particular colors on us.

Color meanings in Feng Shui. Keep the following in mind as a guide, but always remember to tap into your own mind, body, spirit, needs, and goals, as well as your own visceral reaction to each color. — Laura Banko, Holistic Feng Shui Expert and Author of The Holistic Home: Feng Shui Your Mind, Body, Spirit, Space.

Red: Is a stimulator. Orange: Uplifting color that promotes happiness. Yellow or Gold: Symbolizes power, stimulates health, patience, and wisdom. Deeper Blues: Infuses wisdom and introspection. Purple: Inspires spirituality, adventure, and prosperity. Black: Contemplative color that encourages reflection and mystery. Pink: Represents love, romance, and partnership. Green: Represents growth and new beginnings, as well as healing and freshness. Blue-Greens: Represents youth and new beginnings and inspires confidence. White: Cultivates clarity and precision in communication. Gray: Invites helpfulness and represents a harmonious union of black and white. Brown: Offers stability and security.

Color meanings in Feng Shui. The supposed impacts of colors are clearly based on human emotions or how colors typically make us feel. Red is obviously a stimulator because it is bright and attractive. Pink is associated with love and romance as it is the color of flowers, and brown is earthly and therefore stable and secure. It's easy to see how the colors mean something to a plurality of people, and therefore are each assigned a certain significance. Would it, therefore, surprise you that our reaction to colors is gaining some foothold in science? Elliott observed that the past decade saw an increase in academic research on the links between color and psychological functioning. Oyernola and Teo suggest that colors affect our learning and directly influence the retention rates of graduate students. More recently, Stokely noted that an entire body of science known as chromatics or colorimetry supports color. It includes art theory, therapy, the physics of electromagnetic radiation, and effects on the brain, among other areas of study. With these and many more studies finding proof of the link between color and various aspects of our physical and psychological responses, is it difficult to imagine reliance on a 3,000-year-old mystic art developed by the Chinese as a mental model?

Mental models are dynamic. When something is abstract, even though it appears clear in our mind, it still retains an indistinct form that can morph as our perception of it develops with time. Mental models possess a dynamism that enables them to evolve in pace with the demands of our changing social environment. Returning to Feng Shui as our running example, did you know that the Western style of thinking has embraced this Chinese-inspired mental model? While some may argue to the contrary, academic studies have established that a Western version of Feng Shui has evolved and is in popular use. Instead of a Bagua octagon, it makes use of a rectangular Bagua map, similar to the figure below. Without going deeper into the differences, this is an example of the dynamic property of mental models. A good mental model responds to the times and evolves according to our needs. This is true even for a millennia-old model.

Rectangular Bagua Map.

Action Steps. There are thousands of possible mental models, and we use those that serve our needs best and most frequently. There are many types and forms, but all of them are functional, dynamic, and not necessarily scientific, but are significant for you on a personal level. You probably already have a personal mental model, but have not yet recognized it as such. Identify an activity you perform habitually that requires you to think and make decisions. Simply going to the supermarket to shop for the weekly groceries is an example. How do you go about your shopping for food and consumer supplies? Be guided by the following checklist.

1. Do you prepare a shopping list or just remember what you need off the top of your head?

2. Do you shop according to a hierarchy to make sure you get the important items without going off your budget? Or do you shop according to what you see first on the shelves?

3. Do you shop for fresh or frozen items first, then canned or packaged foodstuffs, then essential household products before you get the snacks and drinks? Or do you compare prices of competing brands to see which is more economical? Or do you have favorite brands that you don't substitute with others, price notwithstanding?

5. Do you pay cash or credit, and are there times when you have purchased beyond your available funds and needed to return some items?

When you go through questions like these, you become aware of certain decisions that you make systematically or not. When deciding how much of an item you want to buy, you might evaluate in your mind the usefulness of the additional unit and whether opting for another alternative will give you greater satisfaction. Ergo, you are applying the law of diminishing marginal utility, a mental model grounded in economics. Try it and see the patterns of your decision-making that may comprise a mental model. Moving on.

There are many mental models, but not all are helpful or beneficial in making good decisions. If the models that are readily within our grasp are few and poorly informed, then we risk making half-cocked decisions that we regret later on. In the following chapter, we will get better acquainted with 18 common mental models that emerged from different areas of expertise. Let's expand our toolbox by looking through these other tools.

Key Takeaways. Mental models are representations of how we view the world. We use mental models to convey abstract ideas, simplify complex ideas, process new information, shape how we think, and understand how we view life. Mental models are necessary to compensate for frailties in human reasoning, communicate specialized concepts, and take full advantage of opportunities around us. Mental models are dynamic, functional, and not always scientific.

3. The General Areas Where Mental Models Apply. Learning is not attained by chance. It must be sought for with ardor and attended to with diligence. — Abigail Adams, former First Lady of the United States.

Watching my children grow, I always wanted to instill within them the thirst for learning and discovery in a way that would sustain them throughout their lives. We had storytelling sessions, drawing and painting, illustrated books, and comic books. One day, I watched my son, Charles, poring over his comic book collection, then thought to ask, "Who is your favorite superhero?" I was sure his choice, as most eight-year-old boys would choose, would be Superman. "Spider-Man," he said instead. Perplexed, I said, "Isn't Superman a more powerful superhero? After all, he has super speed, super strength, laser vision, super hearing." Charles shrugged. "Yes, he has super everything, so there's nothing he can't do. Everything is easy for him, but Peter Parker is only a teenager. He was an ordinary boy who got accidental superpowers, and he is always struggling, trying hard to study, work, and fight crime. That's why I like him better."

I was a comic book nerd myself when I was young, but it did not occur to me that imaginary superheroes could be human. I realized that identifying with them enabled my son to pick up nuggets of worldly insight from fictional characters. It took my son's glimmer of wisdom to enlighten me on that. Stan Lee, the creator of Spider-Man, as well as hundreds of other comic book superheroes, was particular on portraying his characters as flawed as much as they were gifted. "Heroes who didn't always get along with each other, but heroes could be counted on when the chips were down," Lee said. It dawned on me that the reason he did this was for children to identify with his make-believe creations and by doing so, imbibe valuable lessons from them. Mimicking the ancient Greek heroes of mythology, Stan Lee intended his superheroes to be models for his young, impressionable audience. In doing so, he has instilled in many generations of comic book readers, and now fans of his television and movie series, the virtues of idealism, courage, and compassion, hand in hand with the acceptance of our human imperfections.

Kids identifying with their favorite superheroes. As we mature through life, there are many models we could choose from to effectively address the various problems we face. In the real world, there are mental models articulated by those who have gone before us, and we're experts in different fields from which we can draw. Models are even helpful for those situations that metaphorically parallel the circumstances for which they were originally contemplated. In the next chapter, we will go in-depth into how models can improve our way of thinking. For now, let us go through some models that were ideally conceived to serve our specialized areas of knowledge, but which, like Lee's superheroes, have become intimately relatable to aspects of our daily life. We briefly described the specialized area, followed by their mental models.

Microeconomics and business are different but related fields. Microeconomics is the study of individuals, households, and firms' behavior concerning decision-making and resource allocation. This study includes the principles governing the markets of goods and services, the choices people make, the factors that influence their choices, and how their decisions affect the price, supply, and demand of goods. The study of business is the body of knowledge that supports the decisions made by an organization or enterprise when engaged in the pursuit of commercial, industrial, or professional activities. They both deal in market dynamics, the scale of operations, and how people in groups respond to stimuli in an economic environment.

Supply and Demand. The law of supply and demand is the theory that explains the interaction between the sellers and buyers of a particular good or service. When buyers outnumber sellers, then sellers command the price in their favor, so the commodity becomes more expensive. If the sellers outnumber buyers, then the buyers command the price in their favor, so the commodity becomes less expensive. Therefore, the law is therefore closely related to valuation, how much or little value we attribute to objects. Like it or not, we often apply this value to people. Those who are born into a higher status, such as royalty, are regarded with greater value. So, too, those who improve their social status by education, learned scholars, or industry, wealthy businessmen, place themselves in higher demand and increase their value. For this reason, we tend to make decisions that improve our status by achieving fame, education, or wealth, or marrying into it. Unfortunately, we use the same concept when we link a person's value to how society perceives them. Ex-convicts are low in demand in the job market because they are stigmatized by society. Young ladies with a history of past paramours are ill-regarded as future wives by scions of respectable families. For some strange reason, however, young men with a similar history of previous conquests appear to gain greater appeal as a future husband, particularly if he comes with an upper-class pedigree. Sadly, when applied to people, the rarer the background, the higher the demand, the greater the social value.

Economies of Scale. These are the cost advantages that companies realize when they produce more of a product using the same level of fixed costs. A business achieves a higher production efficiency when it produces more output for the same input. The costs represented by the input are therefore spread over a larger output quantity, allowing for a higher profit margin without changing the price. Outside of business or microeconomics, we can equate costs with time and resources, and profits with non-monetary benefits when comparing mechanized farming with traditional farming. Tending to a backyard vegetable garden will require a modest amount of fertilizer, seeds, time, and manual toil to grow a variety of vegetables to satisfy the needs of a family. The traditional farming method will be ideal. But tending to 10 acres of a seasonal crop will require scaling up with mechanized processes, since traditional farming will require an inordinate amount of manual labor. The output would be commensurate in terms of tons of produce for the market. Of course, we can reduce this analysis to monetary terms. Even without the calculations, we can already appreciate the effect of scale on methods when considering the desired benefit.

Reward or Punishment. Reward and punishment perform the role of motivators and deterrents in the behavior of firms and individuals. When a behavior is viewed as contrary to the goals of the business or government policy, for that matter, we penalize the individual or firm to discourage repetition of that negative behavior. If the behavior is viewed as advantageous to the company or favorable to government policy, we reward the individual or firm to encourage similar behavior in the future. The concept of reward versus punishment is universal, and we need not regulate it to business or economics. The idea behind it is simple. An act that brings about a negative or painful outcome (a punishment) will be avoided in the future. While an act that results in a positive or beneficial outcome (a reward) will be repeated. It even has a nickname: the Carrot and Stick Strategy. Every child of the 50s and 60s who has received a spanking for bad behavior or an allowance increase for good behavior knows this strategy. Powerful countries use this strategy when they promise economic aid to other states for their cooperation, or threaten the use of military force for their belligerence.

Science and Technology. We all know what science and technology mean merely based on how we live our daily lives. For the sake of clarity, let's adopt the Oxford References definition: Science is the systematic study of the structure and behavior of the natural world through observation and experiment. Technology, on the other hand, is the application of scientific knowledge for practical purposes. The three mental models selected here have a solid foothold in the scientific milieu, but keep in mind that they are also commonly used in other fields of specialization.

The understanding of equilibrium in physics is the condition of a system when neither its state of motion nor internal energy state tends to change with time. It derives its meaning directly from Newton's laws that the balance of physical forces of a body in a steady state will remain unless acted upon by an outside force. While its principal use is in physics, where the action of forces on objects is readily observable, equilibrium is likewise used in other fields to convey stability, balance, state of rest, consistency, optimality, and steadiness. Equilibrium is a very helpful mental model regarding the balance of power and international relations. During the Cold War, two factions were perceivably at a stalemate: the United States and its allies on the one hand, and the Soviet Union and its satellites on the other. It was a war of ideology that tended to erupt into a military war if the balance of power, most notably the balance of nuclear arms capabilities, skewed significantly towards either side.

Economics finds great use for the mental model of equilibrium, particularly when balancing competing forces such as demand and supply, where the point of equilibrium between the two sets the price at which transactions take place. In business, the ideal competitive strategy is one that balances Porter's five forces: buyers, suppliers, substitutes, new entrants, and rival firms. Also an important part of economics and business is the Nash Equilibrium, proposed by John Forbes Nash Jr., for which he was awarded the Nobel Prize in Economics in 1994. The Nash equilibrium is a decision-making model useful in game theory, the modeling of possible interactions between two or more rational players. It states that a player's optimum decision achieves not only what is best for himself but also what is best for the other players. It is used to solve problems in international trade, labor relations, artificial intelligence, price strategies, and many others. Those of us who saw the film *A Beautiful Mind* would be familiar with the story of Nash's discovery. But even then, the principle behind it builds on another model, the Cournot model of duopoly. In 1838, Antoine Augustin Cournot applied a nascent version of game theory to the case of competing firms and deciding their output levels. This is a remarkable example of how one mental model can be instrumental in producing other mental models to help make increasingly complex decisions.

Want to know something simply mind-blowing? Equilibrium goes back much further than Cournot or any theorist of the last three millennia. As early as 1400 years BC, the ancient Egyptians worshipped a god of equilibrium called Aen or Thoth, depicted as having the body of a man and the head of an ibis. He was adorned with the headdress of the lunar disk poised atop a crescent moon. He was also the god of the moon, as well as the deity of language, learning, writing, science, art, and magic. As the deity charged with keeping the balance between order and chaos, he is closely associated with the principle of *ma'at*, or divine balance.

Thoth, a.k.a. An, God of Equilibrium. Equilibrium is such a universal concept and has so much relevance to our lives, even to the youngest among us. You may remember this poem: "All work and no play makes Jack a dull boy. All play and no work makes Jack a mere toy." Little wonder that equilibrium is a key construct in all fields of human endeavor.

Breakpoint. The general understanding of a breakpoint is of a point in a system or process where it is convenient to make a change, interruption, intervention, or other similar action before the process or system is allowed to continue. In information technology, specifically in computer programming, breakpoints are points in the program where the code will stop executing and display the values of the variables at that point. This pause allows the programmer to verify that the values are as they should be and the process is running as desired. When values are inaccurate, the programmer intervenes to correct the error. Breakpoints are helpful for very large and complicated programs to determine which steps or loops an error may be situated.

Breakpoints were defined for their application in military strategy long before their use in information technology. The definition of a breakpoint for this purpose was articulated by Dorothy Keeneland Clark as follows: "A unit is considered to have lost its combat effectiveness when it is unable to carry out its mission. The onset of this inability constitutes a breakpoint." The implication, in this sense, parallels that of a breakpoint in programming as that point where a process fails and intervention in military operations becomes necessary. The loss of combat effectiveness could be attributable to one of several things, such as an attacking battalion ordered into the defensive after severe fighting or temporary panic, or when the attacking battalion is pinned down, and so forth.

When teaching a new song or dance, a teacher may opt to pause at certain points in the song or dance and make their students repeat that portion until they get it right. These are breakpoints. A dance may be interrupted between movements, and a song in between stanzas or at the refrain. When the errors have been corrected, instructions can proceed until the entire selection is learned.

Leverage refers literally to the action of a lever or the mechanical advantage gained by using a lever. There are three classes of levers, as illustrated below. Class 1 lever, Class 2 lever, and Class 3 lever. The following are some practical examples of how physical levers operate. During negotiations between two parties, one of the parties is said to have leverage over the other party if the first party has something the other wants for which they are willing to concede. This often happens in treaty negotiations. For instance, the U.S. has offered the lifting of economic sanctions against North Korea in exchange for the latter's denuclearization. The U.S. is thus attempting to leverage its economic sanctions against North Korea. Whether the leverage is effective or not is another matter.

According to the Southern New Hampshire University definition, systems thinking is a holistic way to investigate factors and interactions that could contribute to a possible outcome. The concept is not so much a practice as it is a mindset. It investigates what set of factors interact together to achieve the desired outcome. Below, we explain three mental models associated with systems thinking.

The Margin of Safety. More commonly used in engineering systems, margin of safety describes the system's additional capacity to withstand loads that exceed expectations. It is described mathematically as: Margin of safety = (Failure load - Design load) / Design load. Margins of safety are built into most systems to ensure that when a system inadvertently takes on a heavier load than expected, the system will continue to perform as designed instead of breaking down or malfunctioning. In an electrical system, if the target current is 20 amperes, a 50% margin of safety would require a rating of 30 amps for its components. In some NASA systems, the margin of safety is specified at 100%, meaning that a component with a required factor of 3 should have a safety factor of 6, capable of supporting two loads equal to its design factor of three before failure. When used in accounting and financial systems, the margin of safety describes the reduction in sales that can occur before the business reaches the break-even point. It has the formula: Margin of safety = (Current sales level - Break-even point) / Current sales level.

At this point, we deduce two things. One, a numerical equation most explicitly expresses the margin of safety. Second, the margin of safety represents the ratio of the extra load to the regular load, however that load may be conceived in that field of endeavor. In driving, the margin of safety often translates to distance. Good drivers instinctively allow for ample braking distance—the distance from the car in front at which the driver applies the brakes to allow for a margin of safety. The smart driver will err on the side of safety and maintain a distance that leaves room for reaction time in less than perfect conditions, such as a slippery road and poor visibility.

Scale. Referring to the size or level of a thing compared to a standard or average, the scale of a system is the proportion of the components to each other in a standard setting. The properties or behavior of a system tend to change when the system is scaled up or down, leading to changes in predicting the results. While the owner can easily manage a small business, a large-scale business may require several levels of managers to be run competently. The idea here is quite similar to the concept of economies of scale in microeconomics and business. If a certain level of inputs to a system produces the proportion of outputs that meet the general standard or average, then the system operates according to scale. When an organization performs more of the same type of process, it becomes increasingly competent and efficient over time. This outcome is attributable to factors such as progress along the learning curve for the workers, and improved logistics and discounts due to the bulk ordering of materials for production.

Algorithms. The Encyclopedia Britannica defines an algorithm as "a systematic procedure that produces in a finite number of steps the answer to a question or solution to a problem." Algorithms are a set of instructions to reach the desired outcome. Computer programs are developed according to algorithms. In the biological world, the DNA of a living thing is the algorithm for developing that organism. Algorithms come even in the most ordinary forms. When your grandmother hands you the recipe of a favorite family dish, she's handing you an algorithm for a family tradition, but you'll never hear any grandmother say it like that.

Numeracy. As an area of study, numeracy refers to the ability to understand and work with numbers. Numeric mental models involve a thinking pattern adapted from mathematical theory, including assessing, processing, interpreting, communicating, and acting on numerical information. Three mental models based on numeracy are regression to the mean, compounding, and bell curves.

Regression to the Mean. Regression to the mean is a statistical phenomenon that creates the impression that natural variations in repeated data sets indicate that real change exists. It occurs when measurements closer to the mean follow extraordinarily large or small measurements. It demonstrates how numerical data evens out. If a variable is at an extreme when it is first measured, succeeding measurements will show the variable to be closer to the average. A random variable outside the norm will tend to return to the norm eventually. As a mental model, regression to the mean signifies that we may encounter situations out of the normal which we should recognize as being temporary and that, given time, will return to normal. In economics, indicators such as the inflation rate or currency value often fluctuate during extraordinary circumstances but are expected to return to normal after the exigency ends. Applying this model metaphorically to human relationships, husbands and wives may bicker and quarrel, but after the inevitable reconciliation... things return to normal. This is consistent with the concept of regression to the mean or return to normal.

Compounding. A process by which an asset's earnings based on interest or capital gains are reinvested to generate exponential gains over time. Compounding accelerates the future value of the investment by incorporating the accumulated earnings with the principal to generate more income. Compounding is the cornerstone of valuation theory in finance. The key idea behind compounding is the wisdom of postponed gratification. While we can spend what we have to satisfy our present whims, we could instead forego that indulgence and invest for future needs. For instance, after graduating from high school, you could either immediately get a job or postpone that job to obtain specialized skills training or a college degree. By investing in your higher education at present, you compound your value as a worker or employee to acquire a more upwardly mobile occupation rather than if you took on a low-skilled job directly after high school.

Bell Curve. The bell curve is the graph depicting the normal distribution of values that assumes a bell shape: high and rounded at the middle with the mean at the center and tapering off to either side as the tails approach zero. The normal distribution is a continuous probability distribution wherein values lie in a symmetrical fashion, mostly situated around the mean. Simply stated, in a large population, the data tends to occur more frequently near the mean and gradually taper down, moving farther away from it, in symmetrical proportion on either side of the mean. The following figure shows an example of the application of a bell curve.

The Bell Curve and IQ. The sample illustration shows the correlation of several indicators with the general population based on their IQ. The average IQ is 100, and the graph shows that 50% of the population scores an IQ of between 90 to 110. About 6% of the people within this range live in poverty. The lower the IQ score, the greater the number of poor people, and vice versa. People within this average range also tend to score 500 in their SAT scores, and to get anywhere between 8 and 14 years of formal education. Those whose IQs fall between 85 and 100 tend to be poor drivers, and the worst drivers have an IQ of below 85. People with an IQ below 110 tend to have more children, while those with an IQ of 110 or higher tend to have more money. Are these hard and fast rules? Certainly not. There are people with low IQs with less money and more children, and so forth. But there are outliers, those who represent data points outside the bell curve. When we use the bell curve as a mental model, we assume that something is likely to happen on average, not discounting the fact that some occurrences may fall out of this average.

Military and War. The meaning of war and military are commonly related to hostilities. Warfare refers to activities undertaken by one country or nation to destroy or weaken another. The military pertains to the armed forces of a country that is prepared for warfare, contrary to the police, who are armed for the purpose of maintaining law and order. Mental models in this category help in situations of rivalry or struggle against an opposing force and involve strategies aimed at succeeding against a strong adversary or challenging conditions.

Seeing the Front. A vital military tactic that good officers perform is personally seeing the front before deciding on a course of action. This means that in addition to consulting advisors, reports, and maps, a military strategist should conduct an ocular inspection of the battlefield prior to making a final decision. A business equivalent of this mental model is walking the shop floor. First-line supervisors and foremen manage the rank and file personnel—the workers who execute the tasks on the production floor, or where they meet the customers. But middle and top-level managers typically are confined to their offices and boardrooms, issuing their memos and conducting meetings. Very few of them visit the workshops or retail shops where the business conducts its principal activities. One very large company, Toyota, pioneered institutionalizing the "walk the shop floor" method, making it an integral part of upper managers' responsibilities.

The upper echelons of the corporate ladder are required to make regular trips through the plants and factories. Talk with the foremen and workers, and observe the processes involved in making a car. The process is called the Gemba Walk. In Japanese, it means the real place or the place where value originates. By observing how processes are done and talking with the people doing them, managers get a better understanding of the business and how they can make better decisions. The method has become more widely adopted in other organizations such as hospitals and is even given a nickname. MBWA, or Management by Walking Around. George Patton observing the battlefield and a manager walking the factory floor.

Counterinsurgency. The word counterinsurgency has a precise meaning in the real world. It is the totality of actions aimed at defeating irregular forces. So it's not simply an action or a set of actions, but the totality of actions. Counterinsurgency efforts actually involve military and civilian law enforcement units. They encompass not only open conflict, but also community liaison and information campaigns. Also, counterinsurgency targets irregular forces, meaning non-state actors such as guerrillas or revolutionaries. A crucial aspect of counterinsurgency is that there are no rules, no templates, no specific techniques for countering insurgents. Counterinsurgency typically involves gaining the trust of the affected public, communities who are non-combatants in the region of the insurgency. Counterinsurgents make it paramount to protect the non-combatants, but sometimes there are casualties ascribed to collateral damage. Often, enticements are offered to the non-combatants, such as food supplies and financial aid, to draw their loyalties away from the insurgents. Counterinsurgencies are costly, unmathematical, prolonged, and sometimes unsuccessful. Counterinsurgencies conducted by governments are seldom only military. They are frequently a combination of political, psychological, humanitarian, and economic efforts directed at the non-combatant populace, and incentives for insurgents to surrender. The result aimed for is the cessation of hostilities and the resumption of peace and stability.

Two-front war. In military parlance, a two-front war is one wherein the opposing forces encounter each other on two geographically separate fronts or lines of contact. It is typically engaged in by two or more separate forces simultaneously or almost simultaneously. The forces of two or more allied parties engage their enemy at two or more locations to enhance their chances of success. The opponent, forced to stage their encounters in different locations, divides its troops and resources, weakening it considerably. The most famous two-front war was World War II, which had two major fronts, the European and Asian Pacific Fronts.

In a non-military context, the two-front war analogy can be applied to a situation where an entity is confronted simultaneously by two adverse but related situations. When Toyota was forced to recall some 8 million vehicles, it faced a crisis with two fronts. The first front is the technical investigation into Toyota's car manufacturing process, and its defense against the allegation of faults in its product design. The second front is the public relations dilemma, where the company's brand image and claimed equality are at stake. The company had to equally divide its attention and resources to both aspects of the crisis.

Human Nature and Judgment. Some mental models are rooted in our emotions and instincts as human beings. We all have had our personal experiences relating to each of them, although we might not have been aware of them at the time. Influence of liking or loving or disliking or hating. Humans tend to be partial to certain people or things they have a liking for, and this affinity may be based on their experience, something in their genetics, their customary ideology, stereotyping, or past association. On these same bases, they could develop a dislike for other people and things. These emotions in favor or against entities often have no rationale. So when we give in to these emotions, it is possible that we are deciding to accept or reject people or things to our own detriment. When personal emotions about people get the better of us, our decision-making becomes obscured.

Ambrose was a shrewd businessman who ran his automotive parts store with prudence and foresight. He grew his enterprise from one small shop to ten outlets in prime locations. He relied on his store manager, Jasper, a young mechanical engineer with a knack for entrepreneurship, to help him decide on the central inventory, the product list, and the schedule for orders and deliveries. However, one day, Ambrose came home to find his 22-year-old daughter sitting on Jasper's lap in a very compromising position. Though obviously embarrassed, the couple explained that they were in love and were planning to get married. Old school Ambrose felt betrayed even after their apology. He not only ordered Jasper out of his house, but also dismissed him from his job. Had Ambrose only calmed down enough to realize that the couple committed no wrong, except for giving him the shock of his life, and that they made a good pair, then he would have welcomed a son-in-law and kept his well-qualified manager. As it was, the couple eloped, and Ambrose's business began to fail. It was not until three years later that, coming to his senses, he appeared at his daughter's doorstep, made peace with her and Jasper, and finally embraced his one-year-old grandson. And he gained back his manager, the son-in-law to whom he entrusted his once again thriving business.

Flight or Fight Response. The flight or fight response is an automatic physiological impulse to either flee or stand your ground and fight. It is a reaction to an acutely stressful or frightening event. In the face of a physical or mental threat, we release hormones that set off a rapid sequence of reactions to mobilize our body to respond to the danger. But what kind of danger could that be? Probably a bear standing in your path as you walk through the woods, or a train bearing down on you when your car stalls on the tracks.

For Edwin, it was facing a girl whom he really, really liked, but was too shy to approach. In senior high school, he admired Samantha from a distance, but could never gather the courage to speak with her. He asked about her to his friends, who slyly tipped her off about his interest. So one day, she decided to approach him directly to introduce herself. Edwin was unaware that she was walking towards him on the school grounds until she was just a couple of yards away. In a sudden fit of nerves, Edwin faced the prospect of either speaking to her or hiding behind the nearest tree. He did what he thought was the bravest thing he could do. He hid behind the tree. Today, as Edwin and Samantha celebrate their tenth wedding anniversary, this brave man does not know how his life would have turned out if she did not confront him behind the tree and say, "Hi, I'm Sam. I heard you were asking about me. Want to talk over burgers and fries?"

Influence of Stress. Very few of us, if any, are strangers to stress. It is that feeling of emotional or physical tension that comes from sustained feelings of frustration, anger, or nervousness. When we are under stress, our bodies react by releasing hormones that make our brain more alert, our muscles tense, and our pulse rate increases. These reactions are intended for our body to readily respond to imminent danger in the short term and dissipate as soon as the emergency situation also dissipates. Stress is our body's mechanism for self-protection. But when the feeling of stress does not appear, even in the absence of danger, this is called chronic stress. It is a condition that may eventually lead to anxiety, depression, hypertension, and even heart disease. While dealing with short-term stress is appropriately handled by System 1 thinking, thus the flight-or-flight response, prolonged stress can make instinctive thinking the default response, even if the dilemma is one that can or should be addressed by System 2, analytical thinking. Chronic stress causes a person to make hasty, half-considered decisions even when there is no impending danger. Overwork, constant pressure, loneliness, insufficient sleep, poor nutrition, or an unhealthy lifestyle all contribute to chronic stress. We compromise good thinking and decision-making when the body and mind are not in peak condition.

Action Steps. Identify a major problem that you frequently encounter at work, home, in school, or even during recreation with friends. The problem must be an important one for which you have trouble finding a solution, something that justifies analyzing it through the use of one or several models. If you are married with children or caring for an aging parent and you simultaneously have a full-time job, you may have work-life balance, WLB, issues. Instead of falling into a general malaise about not knowing what to do, you could break down your problem into manageable segments, using a few of the models we learned about.

Influence of stress implications. When WLB situations come about, avoid automatically reacting with nervousness or panic (System 1 thinking). Instead, understand that there is sufficient time to calmly analyze the actual rather than imagined repercussions (System 2 thinking). Eliminating stressful reactions conserves your health.

Two-front war. Determine what resources are compromised by attending to both work and life responsibilities. Time and personal attention are two resources that may be stretched thin. Finances and other material supplies may also be included. Identify which issues demand your personal attention, then provide for alternatives, substitutes, or reschedules for the less pressing issues.

Equilibrium. Balance is key to the relationship between work and life. It is also the principle behind equilibrium. Let us face it, even if you live alone, you must strike a balance between your work and leisure. Set limits to work you volunteer for and realistic targets to meet in both home and work activities.

Economies of Scale. Identify the activities that provide the greatest benefit to both your work and home responsibilities. Focus on activities that earn you the most for the time spent, particularly those that will earn you enough to hire help with the home or child care for the toddlers. Economies of scale mean taking the options that make more gains for you for the costs you incur with the same time and resources. It also requires discarding those activities that yield a negative net benefit for you. A straightforward and simple procedure that achieves the best results is what makes an efficient algorithm. Activities that are performed at home and at work usually consist of routine activities with occasional and slight deviations. If you could program your important activities more systematically, focusing on the important tasks, then you will be able to devote more time and effort to the things that truly matter. With WLB as an example, identify other problems you encounter that you can resolve using mental models. Moving on. Work-life balance concerns may be handily addressed by these and other mental models. Notice how not only one mental model but several, used in conjunction with each other, enable us to arrive at well-thought-out solutions. The network that logically interconnects the models is what Charles Munger calls the latticework of mental models. Let's learn more about this phenomenon in the following chapter.

Key Takeaways. Mental models from different fields of knowledge help us improve our thinking skills. Microeconomics and business models include supply and demand, economies of scale, and reward and punishment. Models from science and technology include equilibrium, breakpoint, and leverage. Systems thinking provides such models as margin of safety, scale, and algorithms. From numeracy comes regression to the mean, compounding, and the bell curve. Military and war models include seeing the front, counterinsurgency, and the two-front war. Models drawn from human nature and judgment include the influence of liking and disliking, the fight or flight response, and the influence of stress.

Four.