Jack Uldrich
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To Unlearn: Put on a New Hat

Posted in Advertising, Automobile, Business, Creativity, Culture, Future, General, Health Care, Jump the Curve, Unlearn Strategy


I have recounted before how scientific and technical knowledge is doubling every seven years and have pointed out that if this trend continues everything known today will represent just 1 percent of the sum total of world knowledge in 2050. Consider then how a significantly better understanding of the human brain might influence not just science but economics. For instance, we know that, contrary to most economic theory, many people do not always act rationally when it comes to making spending and investing decisions. What will a better understanding of the brain portend for decision-making in this regard?

The answer is likely to be quite a lot. Take the following example. If given a choice between winning $150 or losing $100 on a coin flip (that is, where the odds of heads or tails are equal), many people refuse the deal because they fear the prospect of losing $100 more than they appreciate the benefit of gaining $150. This is the case even though the game is strongly tilted in their favor. The chances are that you will win $75 ($150 x .5) versus losing $50 ($100 x .5)—and this means that if you played the game ten times, on average, you would win $250. Still, most people are reluctant to even accept the bet over ten attempts. What is at work here is something called loss aversion, and it demonstrates that, contrary to rational economic theory, people can and still do make bad decisions—frequently.

A second example involves gift receipts. When people are asked if they would prefer to be given a $15 gift receipt to Amazon.com today or receive a $20 gift receipt in two weeks, a surprising number select the first choice in spite of the long-term economic advantages of the second option. What scientists have discovered is that in both this instance and the coin-flipping example there is disproportionate amount of activity in the limbic area of the brain. Neuroeconomics suggests that such information might be useful in determining how to help people make better long-term decisions such as preparing for retirement.

What else might change as a result of an enhanced understanding of the human brain? For one thing, marketing will. After the 2007 Super Bowl, in which advertisers plunked down a healthy $2.6 million for a thirty-second spot, researchers at UCLA showed that Coca-Cola’s commercials scored the best at connecting with peoples’ emotions and leaving them with a positive feeling. It obtained this information by using functional magnetic resonance imaging (fMRI) to watch how people’s brains responded to  ads.

If neuromarketing is the next wave, it might, among other things, require marketing executives for beer companies to unlearn the notion that scantily clad women, talking frogs, "trendy" vodka or funny shots of a young man getting hit in the groin are neither the best or only way to sell their product.

Medicine is another field ripe for an information explosion. In many instances doctors are today treating some diseases on the basis of limited information. As the connections between the brain and other parts of the body, including the human heart, become better understood, new methods of treatment are sure to arise. Similarly the relationship of whether a disease is the result of genetic or environmental factors, at the present, is also only vaguely appreciated. As new findings come to light, many of these relationship will be better understood. This will require medical professionals to unlearn old ways of practicing their profession and relearn new ones.

A perfect example is the case of Barry Marshall. In the early 1980s he was a practicing physician in Australia with virtually no research experience. Still, he became convinced that ulcers were caused not by stress and spicy food but by a bacteria called Helicobacter pylori. When he presented his theory before a conference of experts in Brussels in 1983 he was practically laughed off the podium. To make a long story short, in 1994 the National Institute of Health concluded that most ulcers were caused by the bacteria, and in 2005 Marshall and his colleague Robin Warren were awarded the Nobel Prize in Medicine. (A staggering number of ulcer sufferers are still unaware that antibiotics can cure them, but that’s another problem.)

To bring it back to a slightly more practical level, we know some lessons on unlearning are already out there. Anyone who has read Michael Lewis’s superb book Money Ball knows that Billy Beane, the general manager of the Oakland Athletics, had been able to keep his team consistently competitive — until this year — by unlearning the baseball business.

Instead of relying on the subjective opinions of crusty old baseball scouts who have spent their lives around the game and claim they can spot the next “phenom” from a mile away, Beane replaced many of them with Ivy League graduates who can crunch players’ statistics on their laptop computers using sophisticated statistical models and complex algorithms. In so doing he has been able to make George Steinbrenner, who thinks nothings of spending $180 million annually in an attempt to get back to the World Series, look foolish for the past eight years. (Personally, I'm hoping the Yankees will lose again this fall.)

It is with some irony then that another good quote on unlearning comes from Satchel Paige, who once said, “It’s not what you don’t know that hurts you. It’s what you know that just ain’t so.” A lot of baseball minds think they know what makes a great hitter or a great pitcher. Unfortunately the continued failure of certain managers and teams strongly suggests that Mr. Paige was right. A lot of what they think they know “just ain’t so.”

Lest one thinks that there aren’t many opportunities to unlearn things, let us quickly look at a second example. In The Wisdom of Crowds, James Surowiecki points out that David Romer, an economist at Berkeley,  used statistical probabilities to determine whether NFL coaches would have been better off going for a touchdown on fourth and goal or kicking a field goal. What he discovered is nothing short of startling. In 1,100 different situations where he determined the coach would have been better off going for it, the coaches opted to kick it 992 times. Eighty-eight percent of the time they made the wrong choice!

Why would NFL coaches make the wrong decision almost nine out of ten times? A big part of the answer is loss aversion. They are afraid of losing three points. The purpose of the game, however, is to win, and by unlearning some old things and relearning new things NFL coaches can jump the curve. Exponential executives can do the same thing by adopting different ways of thinking about old problems.

For more sports-related unlearning, check out these old articles:

Unlearn the Running Rules

Practice Your Unlearning Game

 



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