Problems, and Why We Suck at Solving Them

Lately, we have been spending a lot of time at One South thinking about thinking.

More specifically, we have been spending a lot of time studying thinking and trying to get better at it.

Practicing thinking is no different than say, practicing golf –– when you break down thinking into its component parts and practice each element with intent, your thinking (like your golf swing) can only get better.

And in this day and age of information overload and fake news, critical thinking has never been more important.

Thinking About the Right Thing

Much of what has been so front and center recently has been the idea of bias –– the bias in our thinking, the bias in our institutions, and the bias in our systems.

Ironically, bias is the result of NOT thinking, and instead, using preconceived notions as substitutes for thinking. When we fail to actually think, we lead ourseelves to consistenly off-target and often damaging results.

Yes, this is a gross simplification of the groundbreaking work by Daniel Kahnemann and Amos Tversky called ‘Thinking, Fast and Slow’, but suffice it to say, we, as humans, are not as good at actually thinking as we perceive ourselves to be.

We Don’t Stop and Think, We React

In the large majority of cases, when we are faced with a decision, in lieu of looking outward and collecting more information, we tend to look inward for the closest substitute memory and assume that our past experience applies to the present issue.

Why? Because we are wired that way.

Using associative memory is not only faster, but it also takes far less effort.

For our human ancestors, survival often meant quick reactions and conservation of energy. Stopping and gathering all of the facts is not a good idea when you’re being chased by a lion, and wasting energy contemplating the meaning of life probably didn’t make a lot of sense when you live in a cave, it’s 5 below zero, and haven’t eaten in weeks.

Yet despite the fact that the problems we face now are not the same problems we faced when stone tools and fire ruled the day, we are still largely programmed to use the same problem-solving techniques as our cave-dwelling ancestors used.

And that is where we want to get better.

Defining Problems

When we react quickly (i.e. –– don’t think) we fail to properly define the problem we are facing.

Certain situations, say a ball being thrown at your head, or a stoplight turning red, don’t really require us to define the problem –– we know what we need to do (duck / press the brake.)

But most of the important problems we face aren’t as easy as ducking our heads or pressing the brake pedal. The important problems require far more attention than they actually receive.

Let’s look at the basic types.

#1 Simple Problems

In realty, a SIMPLE problem is not really a problem.

While you might not know how to do something (like change a tire or cook green beans in the Instapot), many others do, and solving a simple problem requires nothing more than Googling the instructions or calling your mom.

If you have ever read instructions that begin with ‘bring water to a boil,’ then you are solving a simple problem:

How do I make a cheese biscuit?
How do I connect my phone to my car’s Bluetooth?
IKEA furniture

Simple problems have a small number of variables and generally, those variables are binary in nature (either / or). Thus, the human mind can solve these problems without much effort and doesn’t require the use of complex tools or advanced techniques.

As you can probably gather, simple problems are not where we struggle (well, at least not most of us …)

Simple Real Estate Problems (already been solved / instructions exist / knowable outcomes)

How do I get my license?
What zone is this house in?
How do I operate a lockbox?

#2 Complicated Problems

COMPLICATED problems are, well, more complicated.

They generally involve a lot of interconnected simple problems and (perhaps) a few unknowns. Even if the problem is complicated, the correct outcome is knowable –– despite the fact that all of the variables aren’t readily apparent.

Complicated problems tend to be engineering / optimization type problems (mathematical, mechanical, financial, technological) and can often require specific tools to help solve:

Why is my car making a funny noise?
Why won’t the video play on my iPhone?
How do I create a pivot table in Excel?

Complicated problems are not easy, but we generally feel as if there is an answer at the end of the rainbow. In other words, complicated problems tend to have one right answer, not an array of probabilistic ones.

Professionals who solve complicated problems are always in demand, and generally occupy respected places in our world.

Complicated Real Estate Problems (requires expertise / compilation of multiple simple problems / knowable outcome):

How do I integrate IDX into my website?
How will paying off a credit card impact my loan qualification?
What is the maximum allowable buildable area given setback requirements in B4 zoning?

#3 Complex Problems

When you move from complicated to COMPLEX, you move from problems that have one right answer to answers that are probabilistic.

To illustrate the difference –– a car is a complicated piece of equipment, but driving your car in NYC rush hour traffic alongside thousands of other humans is complex.

Where complicated problems tend to be mathematical or mechanical, complex problems tend to be biological and / or behavioral in nature. When you introduce behavior into the equation (especially human behavior,) you almost always go from complicated to complex.

Complex problems necessitate an entirely different type of thinking –– probabilistic thinking. Terms like ‘normal distribution’ and ‘standard deviation’ and ‘expected value’ creep into the mix. Gone are finite or binary type answers –– and in their place are answers that offer degrees of likelihood.

Entire fields of study are dedicated to solving complex problems (Chaos Theory / Chaology / The Butterfly Effect) but the reality is that when open-ended systems interact, the outcome really isn’t knowable –– at least not with the analytic tools currently available to us.

Simple, But Not Simpler

The best decision makers tend to get the 50/50 decisions right a disproportionate amount of the time.

How?

By defining the problem better.

As Albert Einstein is credited with saying –– ’Everything should be made as simple as possible, but no simpler.’

In other words, you need to use the proper problem-solving techniques on the appropriate category of problem. Declaring that there is a single best strategy in a multi-offer situation is as arrogant as it is incorrect.

To deliberate thinkers, the decisions that seem like pure guesses to most, are far more obvious to them. By recognizing the type of decision that needs to be made, great decision makers have a far better sense of not just how to best solve the problem, but how much to risk on the decision.

The importance of that last sentence cannot be overstated.

2021

Why write this post? Because 2021 is going to be filled with a lot complex problems.

COVID, thy name is uncertainty.

COVID lives at the intersection of virology, human behavior, economics, and politics –– none of which offer anything resembling predictability.

Aside from COVID’s obvious health impact, COVID is a disruptor of the highest order on nearly every aspect of our lives. We no longer live the same way, work the same way, eat the same way, or interact the same way.

Are these behavioral shifts permanent or temporary? Or are they somewhere in between? No one knows for sure, but the people who take the time to analyze all available inputs and constantly update their mental models stand the best chance of succeeding wildly in the new future –– regardless of what it brings.

Summary

Not only could this post could have been a lot longer, it could have been a lot more … ummm … complicated.

For one, we ignored the fact that each category has degrees of severity (as an example, knee surgery in a controlled hospital environment is far less complex than a medic on the shores of Normandy on D Day –– even though they are both ‘medical’ in nature.)

Two, we wholly ignored the concept of impact of tail risk (think ‘Black Swans’) where extrememly unlikely events carry massive impact and can throw all forms of decison making out the window.

But those topics are posts for another day.

Regardless of your dedication to the science of decision making, simply recognizing that slowing down and taking more time to define the problem before you attempt to solve it, is a large part of the battle.

When you spend a few minutes analyzing the type of problem you have, the methods you use to solve it become far clearer and I guarantee your decisions will become far more valuable to all involved.