I’m deeply inspired.
In early 2011 the most amazing online forum of inspirational, action-taking visionaries and leaders in the world was introduced to me via www.ted.com. Hopefully you’re already familiar with this incredible movement, but if not – consider this your welcoming.
Every minute you spend exploring their website, speeches and conferences will be time well spent. And into the foreseeable future I’m taking a number of my favorite talks from TED and applying those ideas to the financial advisory world and your practice. Today is my initial summary to you, featuring TED (“Ideas Worth Spreading”). My challenge to you on each TED post sent: Give me 18 minutes of attention (and some shared thought on bettering your financial practice) and I’ll open your eyes to growth forever…
TED is a nonprofit devoted to “Ideas Worth Spreading”. It started out (in 1984) as a conference bringing together people from three worlds: Technology, Entertainment, Design. Since then its scope has become ever broader. Along with two annual conferences — the TED Conference in Long Beach and Palm Springs each spring, and the TEDGlobal conference in Edinburgh UK each summer — TED includes the award-winning TEDTalks video site, the Open Translation Project and TED Conversations, the inspiring TED Fellows and TEDx programs, and the annual TED Prize (http://www.ted.com/pages/about).
TED’s YouTube channel is the #1 subscribed to non-profit channel on the site. Topics include an increasingly wide range of topics within the research and practice of science and culture. The speakers are given a maximum of 18 minutes to present their ideas in the most innovative and engaging ways they can. Past presenters include Bill Clinton, Jane Goodall, Malcolm Gladwell, Al Gore, Gordon Brown, Richard Dawkins, Bill Gates, educator Salman Khan, Google founders Larry Page and Sergey Brin, and many Nobel Prize winners (http://en.wikipedia.org/wiki/TED_(conference)).
TODAY’S TOPIC: Are We in Control of Our Own Decisions?
ABOUT THIS TALK: Behavioral economist Dan Ariely, the author of Predictably Irrational, uses classic visual illusions and his own counterintuitive (and sometimes shocking) research findings to show how we’re not as rational as we think when we make decisions.
ABOUT DAN ARIELY: It’s become increasingly obvious that the dismal science of economics is not as firmly grounded in actual behavior as was once supposed. In Predictably Irrational, Dan Ariely tells us why. “If you want to know why you always buy a bigger television than you intended, or why you think it’s perfectly fine to spend a few dollars on a cup of coffee at Starbucks, or why people feel better after taking a 50-cent aspirin but continue to complain of a throbbing skull when they’re told the pill they took just cost one penny, Ariely has the answer.” –Daniel Gross, Newsweek
- Our intuition is fooling us; in a repeatable, predictable, consistent way.
- If we have mistakes using our vision (which we use so frequently) what’s the likelihood of making mistakes with something we’re not quite as good at? For example, financial decision-making.
- Cognitive illusions are much more difficult to illustrate than visual illusions.
- Begging only gets you so far (28% in organ donation). The secret to success beyond begging lies in opt-in vs. opt-out decisions.
- When people don’t know what to do, most times they do what is chosen for them.
- Default is the driver of decision-making.
- With only two options on a decision, most crowds will likely be split 50/50. But adding an inferior option, tied to one of the other options, makes that superior option chosen more than 50/50 (Economist subscription example).
- When it comes to the physical world, most people understand our limitations. But when it comes to the mental world, most people don’t understand their cognitive limitations. The more this is realized, the better we can design the future.
ACTION ITEMS (for the Financial Professional):
- Visual illusion is a metaphor for irrationality. Can you use that table graphic about length in your seminar or appointment process? Can you use the cube graphic in the same way?
- How many “decision illusions” do clients make that you can help them realize?
- Think through your own office procedures, especially your appointment process. What do clients have to opt-in for? Is that the best option? Or are there items that clients should already be involved with, that they’d need to opt-out of? The person who “designs the form” has the most control of the decision. Not the decision-maker themselves.
- Can you take that Economist magazine subscription idea to your seminar appointment scheduling (example below)? Can you go from 50% appointments set to 70-80% appointments set by adding a “dominated option”?
- I Don’t Need a Free Consultation
- Check Here for a Free Consultation
- Check Here for a Free Consultation and Free Tax Return