Many people, and many businesses for that matter, really do not understand the difference between an asset and a liability. When asked what is your biggest asset most people will say their house. An asset is essentially something that helps put money in your pocket and a liability is something that takes the money out. […]
One Person’s Liability is Another Person’s Asset Read More »
More than seventy percent of Americans think we should spend more money on education to reduce class sizes. However, report after report indicates that unless a class size is very small, say, five students, there really is no difference in student achievement between a class of ten or a class of thirty. So why do
Do Your Own Analysis Read More »
Task discounting is the phenomenon whereby people assign more value to near-term or simple tasks than they do to future or complex tasks, even if these tasks hold more value. Have you ever really stepped outside your business and challenged yourself to answer a simple question: Why do I do the tasks I do? If
Are You Guilty of “Task Discounting”? Read More »
For our Everest expedition, the previous few years had offered a better than average weather pattern during the month of May, which is when most expeditions plan to reach the summit. The guides became complacent and assumed that May of 1996 would hold the same good weather pattern. They should have made their decisions based
The “Recency Bias” Read More »
The guides of the Everest expeditions often boasted that they could guide anyone with average fitness to the top of Mt. Everest. They were so confident that they ignored the 2:00 return to base rule and paid the ultimate price. In a poll taken of teen drivers, 93% indicated that they were better than average
The “Overconfidence Bias” Read More »
Members of the ill-fated Everest expedition invested upwards of $65k each. They spent weeks hiking to reach the final base camp before their ultimate eighteen-hour push to the summit. There is an unwritten rule that if you have not made the summit by two o’clock in the afternoon of the final push, you should turn
The “Sunk Cost Bias” Read More »
Entrepreneurs often invest in products or new service offerings that are doomed to fail from the outset because they fail to notice what is apparent to a casual observer. When we expect a particular outcome or we are intently focused on a specific measurement we often can’t see the obvious. The human mind uses filters
Who is Your Jester? Read More »
America was built on a culture of hard work. American workers work harder than the Germans, the French, and even the Japanese. Even during their leisure time many Americans build furniture and grow gardens just for fun. They coach soccer or baseball teams and volunteer to help non-profit organizations. Overall, most Americans are just not
What Do You See In The Mirror? Read More »
Why do we take notes? One reason is it forces us to take new information and consider it in context so that we can produce relevant knowledge and wisdom. The physical act of writing down our thoughts strengthens the memory and provides greater recall later. When you read your notes and edit them, you are
How To Internalize Your Business Plan Read More »
Ask the average person what made the car affordable and you would hear it was the way Henry Ford used the concept of the division of labor as outlined by Adam Smith in the Wealth of Nations. Most people naturally assume that if you have a job composed of many tasks it is better to
Efficiency Myth BUSTED Read More »
