Category: Mental Models

Charlie Munger, the Vice-Chairman of Berkshire Hathaway, has strong views on picking the best ideas from different disciplines and use them to become better at what we do.

In Poor Charlie’s Almanack, a collection of Munger’s writing and speeches, he talks about broadscale and narrowscale professionals and how the former can learn from the latter.

Broadscale problems are ones that can only be solved by using ideas from more than one discipline.

Take management, for example. Good managers need to understand accounting, psychology, economics, technology, logistics among other skills.

It is possible to be an expert in just one area, like engineering, but if we don’t understand how accountants think we’ll find it hard to explain what we are trying to do to them.

The thing is that focusing on a specialist area – narrowscale thinking – is how we get to be very good at something.

But, one of the criticisms of academia is that the system forces people to know more and more about less and less – and so the insights that emerge can be hard to apply in practice.

Munger suggests that one solution to developing broadscale knowledge is to find the best elements of narrowscale education and then scale them up and suggests looking at pilot training as an example of the best kind of approach.

He talks about how pilots are trained in a strict six-element system.

The starting point is formal training. We need to have a broad knowledge of practically everything that is useful to fly a plane.

How often are managers formally trained in management methods before being put into a management role? That’s an investment more organisations need to make.

Training alone isn’t enough. We need to practice until we are fluent at what we are trying to do.

It’s one thing learning about economics. Being able to model supply and demand to maximise total revenue is a different thing. Hint – we should almost always raise prices…

We also think a lot about what we want to do – goals we want to reach. This focus is good, but we also need to think about what not to do, the things we should avoid.

Then we need to spend more time on the things that are more important. That might seem obvious – but how often are we distracted by things that take a lot of time but have little to no impact.

Pilots are trained to always use checklists. And they are better at it than doctors – leading to the quip that this is because doctors are involved while pilots are committed. Doctors who have pilot experience must have an advantage…

Finally, just because we’ve done a course doesn’t mean we know all there is to know – we need to maintain knowledge over time, with more lessons and more practice.

Pilots are required to spend a certain amount of time flying to maintain their license. All professionals need to spend time on continuous professional development – but do we?

A lecturer of ours once said that when we graduated we would have a Masters in business administration. That did not mean we were masters of business administration.

Not yet anyway.

Arnold Schwarzenegger, bodybuilder, actor and Governer talks about success in this video, where he sets out five rules to follow.

Schwarzenegger is inseparable from his role as the Terminator, a cybernetic android assassin, which made his career as an actor.

In the video, Schwarzenegger talks about how all the things that would seem to be barriers to success, the characteristics that would appear to be disadvantages, actually turned out to be unique and distinctive features of his performance and character.

For example, growing up in post-war Austria, he had a vision, a dream to be a bodybuilder – and he worked on making that dream a reality every day.

That was a very specific dream, and one that required a precise and focused set of activities to make happen, but the principle can be applied to any endeavour, whether our dream is to be a chef or a computer programmer.

The next rule was to think big. He didn’t want to just be a body builder – he wanted to be the best in the world. He didn’t want to just be an actor, he wanted to go to Hollywood and be a star.

All too often, we compromise – we settle for less because we don’t believe we can get what we want.

And the fact is that for every Schwarzenegger that made it, there are countless bodybuilders who didn’t get there as well.

In today’s economy, however, compromise seems to be a bad strategy. Winners take all in a network economy, and the people and organisations that succeed are the ones that refuse to compromise themselves.

Which leads to the third rule – ignore naysayers.

There will always be people who will delight in pointing out all the ways in which we can fail, perhaps some that will even give us a little push into the abyss.

We need to seek out a network that has similar goals and aspirations, that is supportive of what we are doing and can help us get on, rather than give up.

And we need that drive and support to keep going. The fourth rule is to work like hell.

Many people work during work time, and then stop. The people that go further are the ones that work longer and harder and better.

There is billable time and non-billable time. Often, what makes it possible to have billable time is everything we do during non-billable time – the extra effort to create and meet people and build capability.

The final rule Schwarzenegger has is to give something back.

A responsibility, a duty many successful people have is to give back to the society and world that has helped them succeed.

Many successful people are portrayed as greedy rentiers.

The thing is that it is likely that more people became successful by being good at what they did, giving more value than they took and building long lasting successful partnerships with others than by stealing or swindling their way to the top.

These people give back – because they got what they had in the first place by giving more than they took.

It’s easy to assume that a character like the Terminator has little of value to say to us.

That would be a mistake – because he does keep coming back.