The Systems That Shape Us with Seth Godin
Episode 34 of the Decision Education Podcast just dropped!
What forces shape the choices we make? Seth Godin, renowned author, entrepreneur, and marketing expert, joins me to explore the impact of societal and external pressures on decision-making, and the role of systems in shaping our choices. Seth shares his unique perspectives on the power of social identities and the significance of empathy in leadership. We examine how both social identities and systems shape human behavior and discuss actionable ways to reclaim our agency, even as forces work against us.
Key takeaways from this episode include how tribes foster community but can also perpetuate division, how emotional appeals and storytelling drive decisions, and how differentiating between “picking” and “sorting” can reduce decision fatigue.
You can find Seth’s bio, a transcript of the episode, and show notes below.
Guest bio
Renowned author, entrepreneur, and marketing expert Seth Godin is known for his transformative ideas in business and leadership. With 22 best-selling books that have been translated into 39 languages, including his breakthrough books Unleashing the Ideavirus, Permission Marketing, Purple Cow, Tribes, and This is Marketing, Godin has inspired millions to rethink how they approach marketing, creativity, and work. Godin’s blog, one of the most popular in the world, delivers daily insights on everything from innovation to personal growth. He is also the founder of altMBA, an online workshop for leaders, the former VP of Direct Marketing at Yahoo!, and the founder of the pioneering online startup Yoyodyne.
In his latest book, This Is Strategy: Make Better Plans, Godin offers a key guide to thinking strategically in a complex, ever-changing world. It shares principles of effective strategy and provides readers with practical insights and tools to align their decisions and efforts with a clear, impactful vision.
Transcript
Producer’s Note: This transcript was created using AI. Please excuse any errors.
Annie: I’m so excited to welcome my guest and friend today, Seth Godin. Seth Godin is an entrepreneur, bestselling author, and speaker who has dedicated his professional life to the spread of ideas, motivating and inspiring countless people around the world. He founded two companies, Squidoo and Yoyodyne, which was acquired by Yahoo!. He is the founding editor of the all-volunteer, The Carbon Almanac, a source of reliable and easily understandable knowledge on climate change that can be shared to create meaningful impact.
Seth has been at the forefront of transforming how we think about marketing, leadership, and creating change in the digital age. He has authored 21—yes, 21 international bestsellers, including Purple Cow, Linchpin, and This is Marketing, as well as his latest title, This is Strategy: Make Better Plans. His blog is one of the most popular in the world with 9,000 posts and more than one million readers. He also hosts the podcast, Akimbo.
Seth is a deep thinker on decision-making creativity and how we can make better choices in our lives and work. His insights on taking risk, embracing failure, and navigating uncertainty align well with some of the core principles of Decision Education. Seth, I’m so excited to get to talk to you. I’m so happy every time we get to talk. You are one of my favorite people. So this is a special treat for me in particular.
Seth: Oh, I think of you every single day. Talk about you all the time.
Annie: Aw.
Seth: And I think it’s worth highlighting the name of this podcast. The name itself is surprising because you pioneered the whole idea of Decision Education. People think they shouldn’t have to be educated in making a decision. But what could be more important?
Annie: Well, what could be more important? And actually, I mean, I think to that point, I think there’s certain things that we think that you don’t need to be taught to do it because they feel very intuitive, right? And we think that decision-making is like walking—
Seth: Mm-hm.
Annie: Right, like you just sort of grow up and then you can do it. So I don’t know if you’ll like this way of me trying to explain it to people but what I say to people is, “Look, when your car is skidding, everybody thinks the right decision is to turn away from the skid. But it’s not. You’re supposed to turn toward the skid, which shows you that it’s not actually just an automatically good process, right? That, that there’s structure and you actually have to learn how to do it. So I don’t know if that resonates with you or not, but that’s the way that I try to explain it.
Seth: Well I, I think I might. Take it about 400 steps further.
Annie: Oh, I like that.
Seth: When your car is skidding, no one is actively working to have you go over the edge of the bridge and die. Most of the systems involved in automobiles are there to keep us alive, so we’ll keep driving. But in fact, most of the systems in our real lives are orchestrated and manipulated so that we will make decisions that don’t help us, that systems exist to keep systems existing. So if you are a victim of the wedding industrial complex, the TV industrial complex, the military industrial complex, and on and on and on, it’s because there’s a system that wants you to be. And that’s why I think it’s so important to teach people about decisions because it’s the only useful response to a system that doesn’t want us to make good decisions.
Annie: I think that’s very well said. You know what, one of the things that I try to teach people is that we need to recognize that we are agents and that we have power, you know, to make decisions. And as we think about, well, you know that I say this, I’m always, we think about the way that our life turns out, there’s sort of luck and the quality of our decisions and that’s it. And when we think about the quality of our decisions, there’s all sorts of internal forces that are working against us, which we could put into the cognitive bias category. But there’s also external forces that are working against us as well that are actually in a lot of ways, advantaging those internal errors that we’re prone to making.
Seth: That’s right. That’s where they got built. You know, I gave a speech years ago to the credit card division of Citibank, and the person who spoke before me got up with glee and announced that they had made 1. 2 billion dollars in profit in the month that just ended.
Annie: Whoa. Okay.
Seth: And you don’t make that kind of money without taking advantage of bad habits that people already have.
Annie: Yeah. And so, you know, I mean, I think just like from, from the large scale of how is the information ecosystem designed to dig in to the biases that we already have you know, in a simple sense, understanding, for example, that when you go talk to a doctor that you’re an agent.
Seth: Mm hmm.
Annie: Right? That they’re not just acting upon you, right? That you’re allowed to ask questions and you can actually ask what the different outcomes might be. What’s the probability of different outcomes occurring? And you’ll be very surprised because when you ask doctors for like, well, what’s the probability of this happening if I choose this, they’re actually pretty reluctant to tell you, which I think is pretty interesting. So. You know, you have to become a good consumer.
Seth: The medical system is a great example of a system. It is not organized to make health. It is organized to make treatments. And the people who are in the system might mean well, but systems are very powerful. They have gravitational forces that are unseen, but persistent. And when we see the forces, we can make better decisions.
Annie: I think that’s exactly right. So like let’s start there cause you’ve actually talked about tribe quite a bit and you, you think about, you know, a lot of what you’ve written about is thinking about tribe in a good way. But there’s also obviously tribe is dual, right? There’s the good way and bad way. Can you actually kind of talk about that dualism?
Seth: Okay, so to start at the beginning, let’s get our terms right. It is a defining part of human culture and nature to organize into small groups, about 150 people. This has been going on for all of recorded history, and I picked the word tribes to describe these groups. I mean absolutely no disrespect, and try not to echo the denigrating way it has been used in our country sometimes, but that’s not what I’m talking about. What I’m talking about is when we see a group of people that want to be in sync, that want to share a culture, a goal, a way of being, a language, a community, we will do lots of things to fit in with the tribe. We will do lots of things to move up in the tribe. We will do things to avoid being kicked out of the tribe. And after I wrote the book, Tribes, I saw to my dismay people misusing some of the ideas to divide us, misusing the ideas to vilify the others, to create internal division where it doesn’t have to be. My take is this, it has never been easier to lead, but most of us fail to do it when we get the chance because we think you have to be picked and we think you have to lead a lot of people. And the answer is no you don’t. You can find ten people or 100 people and make a difference and then it multiplies.
Annie: I’m thinking about the shift in television from three channels to a gazillion. And along with that came this shift of, you know, I feel like when you were thinking about like The Honeymooners, you had to be reaching the maximum number of people possible, right? And then you think about something like Mad Men that comes along, which actually had quite a small audience, but it was a tribe. It was a very specific type of person. And I feel like what happened was that there was a shift in terms of the way that producers were thinking and broadcast networks were thinking that, well, if you can find your tribe, you’re fine even if it’s relatively small.
Seth: Mm-hmm.
Annie: Is that sort of too out there or is that in, in the zone?
Seth: It’s not, it’s not out there at all. It is part of the mirror we’re holding up to ourselves. So it’s not even as old as The Honeymooners. It’s Gunsmoke through Miami Vice. If you have three TV networks, your job is to keep someone from changing the channel. You get table stakes of a third of the population for free. Just don’t go down and you’ll be fine. Succession, which was the most buzzed-about TV show of the year last year, their finale was seen live by four million people. Compare that to the M.A.S.H. finale, which was seen by 70 million people. That’s the order of magnitude we’re talking about here. So when we reflect that, here’s what we see. We see it in any elevator you could count on hearing Van Morrison, or Crosby, Stills, and Nash, or maybe Sly and the Family Stone. But in terms of current music, I’m a fully functioning adult and I can’t sing one Taylor Swift song because there is no center anymore. The center doesn’t exist with music, with movies, with TV, with books. And when the center is gone, it does something to us. Two things. One, it can make us feel lonely and disconnected. But two, when we do find people who share our circle, we are way more intimate with them because we feel isolated from everybody else, but at least we have each other.
Annie: So how do we combat, though, this idea that like when we do find our tribe, right? When we do find that group, how do we become agents for ourselves in not then demonizing people who are outside of that group, right? Because I feel like you know, some of that is self generated. Some of that is, is people sort of using that to our advantage because, you know, I mean, I think that there’s been this shift. There’s certainly been a shift in politics in terms of not necessarily like finding tribe around what you want or what you like, but finding tribe around what you hate, like sort of the common hate that comes with that and tribe being formed around that. But I can imagine, you know, a tribe forming for good. Right? For, for some good person. We all love D&D or something like that, right? And then turning into, but we also, we, we hate all these people and we’re gonna make fun of them.
Seth: Okay. So, I thought you were gonna go somewhere else. We’ll go to the other place second, but to answer your point, human beings are far, far less hateful and disconnected as the media wants us to think. So, the media algorithm makes money when we feel frustrated, fearful, insecure, and hateful. So they amplify this. But when we talk to actual human beings, this is not what they want to do. And so there is systemic pressure for easy division. But the number of people who are truly focused on that level of divisiveness is very small.
The thing that’s interesting about agency is this—when you’re in a tribe, how do you make decisions that go against what they think? So a simple example is how much should a wedding cost? And the answer is, exactly as much as your best friend spent, plus a little bit. And if you’re a sorority sister in a circle of people who spend $100,000 on their wedding, and you want to do the smart thing and spend $10,000 and put $90,000 in the bank, there’s an enormous amount of pressure on you not to do that. And exercising our agency there is actually more difficult and more important than when we’re doing it to contrast ourselves from an outsider.
Annie: Mm, I gotcha. So it sort of brings up this thing about tribe, right? Which is like, tribe is formed around some belief system. And it does feel like it’s a little bit of the human condition that we expect people in our tribe to share all beliefs. Like, so, so we have some beliefs in common, and if you think about the Venn diagram, the non-overlap is sort of upsetting to us, and in particular, how do you purposely create that non-overlap, right? And, and I sort of feel like it’s happening a little bit in politics also where groups that are doing one thing are expected to make statements about something that have nothing to do with their mission. For example, just because they’re part of a certain tribe where we expect those beliefs to be correlated with one another.
So I feel like there’s kind of two ways in which, like, how do you go against the grain, right? If you have, you have a belief that is distinct, that’s very hard. If you know, in a, you have some sort of iconoclastic belief, right? That’s hard. But then, to your point also, as we’re trying to make decisions about things where there isn’t a right answer, right, where we’re living in sort of uncertainty and ambiguity about sort of what the correct thing to do is, generally we’ll tend to hew to what the, what the tribe is telling us to do and actually moving away from that in some way is actually really difficult because we like that sense of belongingness.
Seth: Yeah, that’s brilliant. I think that people in the tribe care more about our actions than our beliefs. And if you want to commit an action that is contrary to the dominant action of the tribe, you are voting at some level for a kind of secession, and that’s very challenging. And what I have found about systems is systems don’t necessarily want what they do, they want the reason they do it.
So where there is room for us to find agency to make new decisions is to continually reiterate what the system we’re part of, what the tribe wants, but to go about getting it in a slightly different way. Right? I care too much about my kids to spend all this money on a wedding. So when you come to my $10,000 wedding, please understand I want what you want, which is for my kids to have freedom and to live a life better than me. And so now my action, that I didn’t have a caterer and a band, isn’t seen as a rejection. It’s simply seen as a different way to get what the tribe wants. And the same thing can happen in politics where somebody can articulate a belief that was put on them by someone who wants everyone in our circle to believe the same thing. But if we come back to first principles, things like responsibility or agency or freedom or community, then we can use that to justify an action that might not align with everybody else’s.
Annie: So it sounds like what you’re saying is that we, we ought to be very thoughtful about framing.
Seth: That’s exactly what I’m saying. And I believe that people only want two things, status and affiliation. Once we move past freedom from fear, it’s status and affiliation.
So I tell the story about the school district where I live. In New York state you get two tries to pass the school budget. And if you fail both times, the state takes over your school. They make draconian cuts. And my town, small town, great schools. We won the Blue Ribbon School from the Department of Education a couple times. There’s only one elementary school, one middle school, one high school. And year after year after year, the budget passed and year after year, taxes went up.
And one year, a group of people, a tribe of people, culturally, decided they had had enough. These were mostly seniors, retired people, people who had inherited their home, and they defeated the school budget. By a fair amount. Now, the problem with defeating the school budget is it is self-defeating ’cause then real estate values go down dramatically and you end up losing more money than you would’ve saved. And you can have all these arguments about the primacy of kids, and you can have all these discussions about how unfair it is that you got, your kids do school when the taxes, right? And now my kids are going, none of that is going to work. Because all of that is an argument that leads to division along the lines that were established in the first place.
So here’s what happened. Five days before the second vote, four people in town went to a stationery store and bought a hundred yards of blue ribbon. And they hung the blue ribbon from the main big tree in front of the main school that everyone drives past. Remind me, people, about the Blue Ribbon School, about what our core beliefs are, that we care about community and kids and solidarity. There was no argument. There were just blue ribbons. And within the next four days, other people, with no coordination whatsoever, put thousands and thousands and thousands of blue ribbons all over town, in trees everywhere you looked. And the budget passed two to one. And the lesson is, people like us do things like this. The lesson is, sending a signal that said, we are all in this together, aren’t we proud to be here, was enough to activate the people who didn’t vote the first time, who would go back the second time to vote. And this shift, which is framing the decision in emotional terms as opposed to a spreadsheet, is how we do almost everything. We just don’t want to admit it.
Annie: Yeah. So are you familiar with the identifiable victim effect?
Seth: Let me hear.
Annie: Okay. So there’s a very well-known finding in psychology. It replicates which is that, let’s imagine that I’m trying to raise money from you for my nonprofit. And so let’s imagine that I’m saying, Seth, my nonprofit is focused on Africa, and what I do in my nonprofit is I partner with communities to drill wells that the community then owns to make it so that they have clean water.
Seth: Mm-hmm.
Annie: And what I do is I tell you, so the average person in Africa has to walk over two miles to get to clean water and that means that the level of education that people reach is lower, and this is how much money, you know, this is how much earnings it costs people in terms of productivity, and this is how much extra disease it creates, so I tell you all these statistics.
I’m not gonna get any money from you. Now, from my side, as the person who has the charity, of course. Sort of the breadth and depth of this problem is what’s motivating me to want to solve this problem, right? So, my urge is to tell you all of these statistics to get you to see, like, this is really important. Like, this is really gonna change the world because so many people are affected by this thing. But you will not donate very much money if I do that.
If instead I tell you about one boy who has to carry the water to the well two miles. He has to walk two miles. To the well, go get the clean water, bring it back. And he can’t go to school because he has to do that in the morning and he has to do that at night, and when he can’t get there. And then he developed, you know, a tumor. And I tell you that story. Now you will give me money. And what I think is very interesting is that if I try to combine the two, so I tell you the story about this little boy. And then I follow it with telling you all of these statistics, I’m back to square one.
Seth: Or maybe worse. Yeah.
Annie: Yes. So, I need to just tell you about the boy. And that sounds very much like the blue ribbon, right?
Seth: Well, I want to go one step further, though. That is sort of like it, but what works even better, alas, than telling me about the boy is saying that Adam Grant and Jacqueline Novogratz and Baratunde Thurston are going to be sitting at the table, and there’s two more seats at the gala, do I want to come?
Affiliation and status. That when you tell me the story of the boy, what you’re actually giving me is something I can tell my spouse. You’re giving me something I can tell somebody else, or my parents, or myself, about who I am. Because it keeps coming back to affiliation and status. Now there are some nonprofits, the rational altruists, whoever they’re called, they define status as I’m the kind of person who’s not influenced by a story, which is a story unto itself.
Annie: That’s true. It’s an identity. It’s an identity unto itself. Exactly.
Seth: So pick, pick your story, pick your future.
Annie: One of the things that I actually recommend in Thinking in Bets is that if you do want to disentangle from some of these things, form a tribe that’s around the disentanglement.
Seth: Exactly.
Annie: Right? But do that deliberately. Don’t pretend that you’re, you know, I think the difference is what I say is that doesn’t mean that you’re tribalist, right? It’s, it’s sort of saying, look, I have all sorts of things that are going on in my brain. And one of the primary things is community affiliation, belongingness, distinctiveness, right? These are all things that are very important for us to be happy, healthy human beings. Don’t somehow pretend that you can overcome that. Instead, lean in and say, okay, how do I create community around more rational thinking? So for example, if we’re thinking about you know, the wedding problem, right? I’ll call that. How do you create community around being distinct in the kinds of choices that you make and embracing that?
Seth: Right. I mean, if you look at the pictures from 25 years ago of the skinheads or the punks in London, they all dressed exactly the same. In their desire to be individualistic, they were the least individualistic they could be.
Annie: Yeah, you know, okay, so I had an experience, gosh, it must have been 20 years ago, which really made that particular point hit home for me. I was out in L.A. and I think it was during like a poker tournament or something and I had a day off. And so some friends of mine and I decided to go to Disneyland. So we did that and we did not know this, but we’re going on goth day. So just so people know, I don’t know if they still do it, but there’s one day a year, which is goth day at Disneyland. We didn’t, we didn’t know. We just happened upon it. And I remember because, you know, you would think about goths as so individualistic and trying to stand outside society and be really different and all these things. And thousands, thousands of goth people were at Disneyland. And you realize, they’re just conformists. Like and I, I don’t really say that in a bad way, I mean, because that’s just human nature.
Seth: Right. You have to, you have to get rid of the word just. They’re not just conformists. They’re people who are amplifying their tribal identity by conforming.
Annie: Right. Right. You know, and, and again, like not in a bad way at all because I think that that’s just the human condition, right? But it was very striking. Right. It’s like everybody had, you know, the same color hair and the same clothes. And you were like, oh, gosh, you know, and I think that, you know, goths really define themselves as nonconformists.
Seth: Yeah. No, I remember reading a science fiction story a very, very long time ago, super short story about the tailor who made all the superheroes’ costumes. Because after all, it’s pretty clear they get them off on the same guy.
Annie: Yes. That’s true. He has like the corner on spandex. He’s cornered the market on spandex. I want to shift for a second to thinking about This Is Strategy, which is your new book that’s coming out. So first of all, I’d love for you to just sort of me the elevator pitch for This Is Strategy, because I actually have some questions that sort of connect to this decision-making issue.
Seth: Well, if I had Annie Duke as my coauthor, the subtitle would have been Make Better Decisions, that what it means to have a strategy is you have the freedom to make a choice. The choice is what should I do now? What should I do next? Where am I going? Most people in the world still don’t have that freedom. Their only choice is chop the wood, get the water, feed your family, go to sleep. But if you have a chance as an organization or an individual to decide what’s next, you will do better if you have a strategy. And a strategy is a philosophy of becoming, where are you trying to get to? And it has four components, one of which we’ve talked about a lot, which is systems, the invisible things around us that push us one way or the other.
The other three are games, and nobody knows this better than you, games don’t have to be fun, and games are simply any situation where there are players and resources, rules and outcomes. And so, if you get pulled over by a cop, that’s a game. If you’re trying to get through security, that’s a game. And if you’re trying to get a job, that’s a game.
And the other two are time, which is another Annie Duke concept, which is every moment that goes by is different than the one before. So, the move I made three moves ago was there so that four moves from now I’ll be glad I made it. But too often we make decisions like credit card decisions because we can’t sit still for one minute in the tension, we just gotta let it go.
And the fourth one is empathy, which is realizing other people don’t know what you know, don’t want what you want, don’t see what you see, and if you’re not willing to embrace that, they’re not gonna go along with you. So unless you are on a desert island all by yourself, empathy is required. And when we weave those four things together, back and forth and back and forth and back forth, we can get the wind at our back, we can be a surfer with a better wave, and we can get to where we’re going without worrying about how fast are we getting there.
Annie: So, I just want to ask about empathy, so, you’re speaking about empathy in terms of like other people don’t necessarily know what you know, and so to get them to start rowing in the same direction as you, you have to, have to get them to see what you see.
Seth: You have to create the conditions for them to do what you need as the way for them to get what they want.
Annie: So are you thinking about that as somebody who’s on your team? Or are you thinking about that in the sense of some strategy is trying to figure out how to win in a competitive environment? Because one of the things that I think about like in competitive environments is that it actually requires quite a bit of empathy. Right? Because you have to have empathy for your competitor.
Seth: This is true. But all environments are competitive because everyone who has a choice is making the choice in a way that is not obvious to you. And so anyone who doesn’t eagerly go along with what you want has chosen a competitive alternative. And so there are situations where a manager has the power to tell someone exactly what to do, but there aren’t very many of those situations. Most of the time, what we discover is people are going to do what they want to do. They might fight us along the way. They might lie to us along the way, but they’re going to bend in the direction that matches their view of the world. So if we can create the conditions where the thing they most want happens to involve us getting what we want, everything gets easier.
Annie: So could you give an example of maybe executing that poorly and executing that well? Okay.
Seth: Okay. So if we think about leadership in an organization, poorly is do what I say or you’re fired. Poorly is the beatings will continue until morale improves. Poorly is I have power, I’m going to tell you what to do. Whereas, there are plenty of organizations where people get paid a lot of money, or where they get paid zero, where they show up on their own, eagerly, with new ideas, leaning into possibility, figuring out how to put extra into what they’re doing because they want to. Why is that? Because you’re paying them? Well, no. They pay them at UPS too, but the people at UPS don’t care about anything, because the people at UPS have been abused and mistreated over and over again, treated like you know buttons to press. Whereas the person who’s ,a one of the examples is a passionate guy I knew. He worked at Dean and DeLuca Cafe for 20 years and he was slightly learning disabled and he was basically the mayor of that cafe and he didn’t show up for $12 an hour. He showed up to make a difference. And the $12 an hour was a souvenir he got for doing that work.
And the same thing is true if you want to persuade people to vote for gay marriage, right? You’re not sitting there arguing them into it. You’re simply saying for people who want to be like this, who want to tell their family a story like this, this is the path people like us are choosing. And we didn’t have to go into the weeds. We simply created a framing that made them say, yes, that’s exactly what I want.
For 40 something years, I’ve been helping to run a summer camp up in Canada. And motivating a privileged 17-year-old is not an easy thing to do. And the dynamic that is indoctrinated into kids from the time they’re 4 years old is when the boss or the teacher asks for more, you give them less. Because if you give them more, they’ll just ask for more. And so, when you show up for the summer, one of your first real jobs, your goal is to spend as much time with your friends as you can. To undermine the authority of people who are older than you.
And to phone it in for anything that feels scary. And if that’s the environment that somebody is in, it’s going to be very hard for the person who runs that facility to look the parents in the eye and say, we gave your kids a great summer. Because basically you’re running two camps, a camp for the campers and a camp for your staff. And the shift is to get the staff to realize the camp is for the campers. And when they get that joke, they will get it because they understand it then raises their status. It then affiliates them with the people they want to be next to. If you can get them hooked on that feeling, you don’t have to manage them anymore. You just have to lead them by creating the conditions for them to see that an 11-year-old who’s homesick is an opportunity, not a problem. It’s an opportunity for that person to interact in a way that will cause them both to get to where they’re going.
And so how do we do that? Well, it’s a subtle dance of status and affiliation. It’s not manipulation because once it works, they’re glad you did it. You’re not doing it against them, you’re doing it with them. But when we catch people doing things right, when we build scaffolding so they can slowly adopt this mindset as opposed to have to bet everything and then fail, we diminish the power of the class clown and we amplify the power of the quiet person who’s been contributing. And this is, it’s subtle. But it changes things. And what we discover is it can work to invent a whole industry, right?
Like the number of people who played poker, quote, professionally 30 years ago was a tiny little number. What made it grow? It wasn’t that they paid all the people who entered these tournaments a million dollars. It was that they created the conditions so that even if you were losing, you were glad you showed up because you were getting something fed. And it’s this idea of feeding a need that enables us to build a new system.
Annie: You know, one of the things that we, we think about in decision science is something called temporal discounting. And temporal discounting is that we really, really, really love to take a discount in the present at the sacrifice of something that we could get in the future if we just waited a little while.
Seth: Oh, yeah.
Annie: So the most common, you know, well-known example would be the marshmallow test.
Seth: Which I have a lot of trouble with.
Annie: There’s a lot of, I was about to say that, lots and lots of problems with the marshmallow test. So the basic premise is you put a kid in front of one marshmallow and you say, hey, you can eat this marshmallow now, or you can have two marshmallows if you wait 15 minutes. And then it turns out that some kids are pretty good at waiting, but most kids want to take the marshmallow now and they, they sacrifice the marshmallow later. Now, it turns out that a lot of those results are explained actually by socioeconomic class, which is what a lot of these results end up being explained by.
But there are lots and lots and lots of examples of this temporal discounting problem, you can see it actually in paying tickets, right? So if you owe a ticket, even if you give people a discount to pay it now, they’ll tend to want to wait because it feels bad. It’s painful, right? So they’re they’re hurting themselves by not paying it now. But if I say to you, hey, do you want a hundred dollars today? You know or a hundred and twenty dollars in a year, you’ll take the hundred now, which is obviously hurting you as well because I don’t think when you put that hundred dollars in a bank that you’re going to earn $20.
So we know that this is a problem. So in This Is Strategy, this this is a problem that you talk about right, which is how are you balancing out kind of what’s happening in the present versus what your, your sort of longer-term strategic goals are. So I’d love to hear you kind of riff on that a little bit.
Seth: Well, you just said the most important part. And saying it helps a little bit. But the dominant systems in the stories we tell ourselves will undo that most of the time. Part of the challenge with the marshmallow test, as you hinted at, is if you grew up in a house where there’s not enough food, and your parents more than once have said there’s nothing for dinner tonight but a bowl of cereal, and someone offers you something, you’re going to take it because you have been trained not to believe adult promises. And so what we need to do when we think about time, spending time, but also the time-value of money I believe is, A, say it out loud, and B, surround ourselves with peers or a tribe or standards that would make us lose status and affiliation by short cutting.
So an example of this is the suburbs and braces. So if a parent puts braces on their kid’s teeth, that isn’t an economically unselfish thing to do because the parent is spending money today that they don’t have anymore to help someone 15 years from now when they’re not going to be under their roof. So why do it? You do it because you get points with your peers from a status and affiliation point of view, than if you had your kids walking around with funny teeth, they’d look at you funny, like, why don’t you care enough to pay the money to fix your kid’s teeth? So, you know, or the flip side of that, traditionally in parts of the United Kingdom, people had terrible teeth because the peer pressure to have good teeth wasn’t there. So if something is important to you, like saving for college, finding three people to be in a peer support group is the single easiest way for you to shift your time-value of money. Way more important than any personal habit you can put in place because if you have to report to people on Friday, oh, no, I blew this week’s college money because I went out for dinner. That’s embarrassing. And so you’re not going to do that. You’ve moved the embarrassment to the moment as opposed to having to suffer 20 years from now when you say to your kids, “sorry, you’re on your own.”
Annie: So I’m thinking about a couple of things. One is like, I was lucky enough to go to a high school where you got status from good grades, which is very unusual. But the school itself, I think, was doing a lot to make that happen. They sort of just created a culture around that. And the thing is that, you know, there was an expectation about what type of college you would go to. But in reality, it was the status around good grades that made that happen, right? Because you can’t really tell someone in ninth grade to do something for college, right? Right. You have to, you have to create status around that. So that, that, that makes me think of that. I’m thinking a little bit about some work that Todd Rogers has done on trying to get people to be more energy efficient in terms of their energy use in their houses. He tried a bunch of stuff and what ended up working actually was showing them their energy use as compared to neighbors who used less energy than they did.
Seth: Right. It doesn’t work, that doesn’t work for long, but it definitely works for a while. The reason it doesn’t work for long is you need to reinforce it, right? If it’s the same number every month, you stop worrying about whether people are seeing what you’re doing. But, in the book, I talk about an experiment that happened randomly in the Netherlands and it turned out there was this whole neighborhood where all the houses were basically identical. Except, for whatever reason, half of them had the electric meter in the foyer when you walked in, and half of them had the electric meter in the basement, which you had to go look at. And the houses that could see the electric meter every day when they walked in used one third as much power as the other people.
Annie: That’s really amazing. What, what I think is really, I think even more amazing is that they didn’t habituate to it.
Seth: You mean they didn’t just accept that they were going to spend all this money?
Annie: Yeah, like when you see something over and over again every day, you start to sort of, it, it no longer sits in the foreground.
Seth: Right. But if it starts as a habit, changing the habit would be too hard.
Annie: Right. That’s true. That’s true. That’s really good.
Seth: Right? And so, and so part of what we need to think about is, which system did I back myself into that’s doing this to me? And how can I build scaffolding so I can work myself into a habit that undoes it? And I can do it overtly by having a peer group. I can do it covertly by making it, I have right over there, 40 bars of Bean to Bar chocolate, and I pass them every single time I walk in this room. There’s no question that if I move the chocolate over there, I would eat half as much chocolate. I don’t want to do that, but I could. And if there was peer pressure status or affiliation associated with it, you can bet I would do that.
Annie: You know, the way that I would frame it is, are you trying to motivate people by indexing on outputs or inputs, right? So that’s sort of how I’m thinking about framing this in, you know, in terms of what you’re talking about. So Roland Fryer is an economist at Harvard. He got very, very interested in education. And in particular, he was really distressed when he was looking at the statistics that showed that in underserved communities, that the average eighth grader was, their math and reading scores were between second and fourth grade level.
And this has to do with something called social promotion which is that we made a decision in this country that we want to keep people with their peer group. So we want to keep people age matched. And so often through eighth grade, people are getting promoted to the next grade even if they do not have the core competencies that would be associated with that.
So anyway he wanted to address this. So he’s an economist. He thinks about incentives. So the first thing he tried was paying kids for good grades. Failed miserably. Right? So he was like, look, for every A you get, I’m going to give you, you know, some money. And he thought, solve the problem. I’m an economist, it will work, right? So that was the first thing that he tried in a school. It literally didn’t change anything, it didn’t move anybody’s grades. So what he did next was, and I’m thinking about this conversation that we’ve had, because I think that this sort of ties, it brings everything together, is that he paid people for inputs.
Seth: Mm-hmm.
Annie: So, what do we mean by that? They got paid for reading books and doing book reports, right? So they had to prove they read the book, but they got paid for turning homework in. They got paid for every day that they didn’t have, like, a disciplinary problem or every day they showed up to school, so on and so forth. So they could get paid for these different things. And then I think, again, bringing this all together, the way they got paid was, in the lunchroom there was a big ceremony. And so it would be, hey, Seth, you read three books this week and you came to school every day and dah, dah, dah. So I’ve got $9 for you. And so you would then come up and everybody would be clapping and I would, in this wonderful ceremony, present you with your money and then you would, big smile on your face, you would go back and sit down. And that did change everything.
Seth: Yeah.
Annie: And those kids got to grade level so fast.
Seth: I would go one step further and say all they really needed to do was have two lines in the lunchroom, the fast line with better food for people who handed in their homework, and the other line, for people who didn’t. And all you had to do to get into the fast line was hand in homework. It wouldn’t take very many days for the status and affiliation that would come from being in the better line to shift behavior. And it’s manipulative, and I’m not encouraging it because we’re already taking advantage of people at this stage in our society. But the lesson here is short feedback loops and the feedback loops directly related to something someone already wants.
Annie: I think that would work amazingly well, and I think people would get really mad.
Seth: Yeah. And you know, part of what I talk about in the book is how you get your systems changes approved. So in the book, I described how I solved the kidney transplantation problem. I had a relative who needed a kidney, so I learned a lot about the waiting list. There are waiting lists all over the country. There are different lengths in different places. Some people move to get, move up the waiting list. And economists had done things like horribly go to poor people and pay them before they die in the hospital to please sign this piece of, this is unacceptable. And other countries have an opt-out system. And the opt-out system works great because people are lazy. I’m just going to leave it the way it is. But the U.S. has an opt-in system.
So, what I invented was a simple game, which is this. We have all these priority lists for who’s going to get a kidney based on need, based on location. I just wanted to add one data point and make it the first one, which is how long have you been on the donor list? Because if you’re not willing to give a kidney for religious reasons, you shouldn’t be allowed to get one, right? And if you’ve been on a list longer than someone else as a donor, then you get the next kidney. If we announce this, within a week, every doctor would be on every single patient’s case. Please just sign this, because you’re going to need it later. There’d be all this pressure in the short run to pay attention to this thing today, because the clock is ticking. Well, my friend, Dr. Jonathan Sackner-Bernstein, who’s a brilliant medical researcher, took my idea and worked with me to make it into a gobbledygook article that could get published in Transplantation journal, which was then picked up by a Yale University omnibus.
So, we proved in that community that we were right, and that’s all that happened. And the reason is, I wasn’t prepared to spend four years of my life going to conferences, issuing preprints, going to meetings, socializing it. Because the thing is, some things can change neighborhood by neighborhood. Those you can more easily change a system, but there’s only one committee that approves this. What do the people on that committee want? They want to not be wrong. They want deniability. They want the status that comes from being on the committee blameless. So, in order for me to get them to change their minds, I would have to change a whole bunch of things around them. And so, one of the lessons is don’t try to start a log on fire unless you have enough kindling to get it started. And each of us has a different amount of kindling for different kinds of problems, but we have to keep that in mind.
Annie: I love that story. So just to be clear, this is not the system in America, but it would solve the problem.
Seth: Within two weeks, there’d be no shortage of kidneys.
Annie: Within two weeks, it would just, it would just solve the problem.
Seth: The list would go away.
Annie: It’s really just addressing what you’re saying is there’s a free rider problem. And so it’s just solving the free rider problem, right?
One of the topics near and dear to my heart is how do you figure out when to go slow and how do you figure out when to go fast? So I assume people who have read your book probably think that you’re just telling people to go fast all the time.
Seth: Not at all.
Annie: That’s my guess.
Seth: Mm-mm.
Annie: No? They’re not misunderstanding?
Seth: Well, if they think I’m saying go fast all the time, they’re misunderstanding.
Annie: Right, that’s what I’m saying. I don’t think that’s what you’re saying at all.
Seth: Perfectionism is a trap because it feels morally wrong to argue against perfect, morally wrong to say, no, no, no, no, no, ship junk. What we need to do is, as professionals, define the spec. And our job is to meet the spec. If the spec isn’t good enough, then make a better spec. But once you meet spec and you run out of time or you run out of money, you must ship the work. And if you don’t, that’s resistance, that’s fear, that’s you holding back. And everyone gets another 24 hours every day, it’s amazing how fair that is. And how will you invest it? Well, if you don’t iterate, you’re not going to improve. If you’re only going to write one song in your entire career as a songwriter, you will learn nothing about your instincts. Whereas, if you say, my spec to get started, right? The model T, the spec has nothing in common with the spec for Ford Taurus or whatever it is. Every single thing about that car has been improved, but that’s because there’ve been 400 car models between the two of them. So what we do is we look at a problem and we say, if I can make a solution that’s this good, that by definition is good enough. And when I run out of time and I run out of money, I ship or I say I failed, but I’m not allowed to keep working on it. And so this isn’t go as fast as you can, it’s go as fast as is necessary.
Annie: Yeah, so this brings up something that I think about in decision-making is that I think that we don’t think about thresholds enough. And in particular, you said, you said a word that I use a lot. Which is good enough. And what’s the threshold for good enough? And so it, I, I feel like it’s thinking about what’s the framework for that, right? Like, how do, how are we thinking about the framework for what the threshold for good enough is?
So, you know, one of the things that I think about a lot is, well, how bad is it if you get it wrong? And that’s a really important question to ask for, what do we mean by good enough? And that has to do with when you’re building that spec, right? Like, okay, but how bad is it if we get this wrong? And that will tell you how much time you ought to put into it, right?
Seth: But let’s balance that with how bad is it if we get this wrong versus how much does it cost for me to get it more right? So, you know, I was in Syracuse a year ago and there was a line of 30 people for an ice cream stand and I was up to one more person in front of me and she got to the front. And it took her five minutes to pick a flavor. And that has nothing to do with making a better decision. That has to do with the fear of making the wrong decision. And as a result, she ruined her evening because the fear overcame the delight that she would have gotten from simply picking.
Annie: So that actually brings up something I think that’s, that’s so important about this idea of like, how are you figuring out where this threshold sits and what, what happens when you get beyond the threshold? And you just said the word picking, which I think is really important, right? We have to distinguish between sorting and picking. So sorting is options I like versus options I don’t like. And what the threshold for getting to an option I like is, is gonna change depending on sort of what’s the impact of getting it wrong.
Seth: Yep.
Annie: I should have a pretty low bar if I’m hiring an intern, but a pretty high bar if I’m hiring a CFO. But what this woman in front of you got caught up in is, well, these are all things I like. And then we think it’s really hard to choose among them, except that we don’t have the acuity. And also it’s a waste of time. So just flip a coin.
Seth: Yeah. Ben and Jerry’s brownie ice cream is the number one ice cream in America. All of the brownies are made three miles from my house in Yonkers, New York, by a team at the Greyston Bakery. If you want a job at the Greyston Bakery, here’s how you get it. You go to their front desk and there’s a clipboard and you write down your name and phone number. And when a job opens up, they hire the next person on the list. There is no job interview. What’s the point? They’re trying to attract formerly incarcerated people, people who have had addiction problems. Now, once they hire you, there’s two weeks of training. And if you can’t make it, you’re out, right? But the people who they end up hiring have dramatically longer tenure, dramatically better job performance, dramatically better job morale. So Greyston, now a nonprofit, spends a lot of time trying to get institutions to adopt open hiring. And almost none of them will, despite the math. Like, so Body Shop did it, shortly after the pandemic. And it worked again, 60 percent better than the other way of hiring. When I tell people about this, they go, oh, I couldn’t do that, I have to interview people. Why? Because they want control and the feeling that comes with that, as you said, picking versus sorting. I think that’s a brilliant way to think about it.
Annie: Yeah, because, I mean, the thing is, like, if you’re hiring an intern, your point is they still have to go through the training and you can reverse the decision. So it’s not just how bad it is if it doesn’t work out, but if it doesn’t work out, can I reverse that? And once you understand that’s true, then you’re fine. Because here’s the thing. Nobody ever got hung up trying to figure out whether to go on vacation to Paris or Gary, Indiana. That’s not a thing. That woman in front of you in line was not choosing among flavors that she didn’t like. It’s when you get to stuff where this is gonna be fine, that’s where we get hung up and what a freaking waste of time.
Seth: Yeah, that’s brilliant.
Annie: So just ship the decision
Seth: Yeah, that was worth the entire cost of the podcast right there
Annie: Just flip the coin. I mean, I think this is the thing that people have to realize, right, is that you’re not getting hung up trying to choose among options where some of them you like and some of them you don’t. The place you get hung up is when you like the stuff. And then you have some delusion that you can see into the future.
Seth: Right. Or the traffic ticket, two options you don’t like, and you spend all your time paralyzed because you don’t want to commit to one that you’re going to have to live with. Yeah.
Annie: Right. I think that’s exactly right. So, can you talk a little bit about The Carbon Almanac, because I know this is really your baby.
Seth: Well, it’s not, I’m not going to claim it’s my baby, but I will tell you it is a perfect example of everything that you teach about where we are as a society, about systems and decision-making and time and bracketing and how we’ve been seduced into the short term.
So I wrote my first blog post about climate change 18 years ago and it didn’t change anything. Amazingly. And I realized when I read a book called Ministry for the Future that I hadn’t written very much about climate change. And the reason was I felt stupid. I felt like a hypocrite. And I felt like it wasn’t going to do me or anyone else any good.
And then I said, well, that’s true for me, a fairly informed person who has a bachelor’s degree in mechanical engineering. I bet it’s true for a lot of people. And I used to make almanacs for a living. So I thought, I know, I’ll make that kind of book on this topic for the kind of person that learns that way. But then I said, no. But that’s not a model for how we’re going to solve this problem. We have a systems problem, and the only way to solve a systems problem is with a systems solution. You cannot solve this problem by one person refusing to use plastic bottles. So I invited 30 people to join me on an online board that I helped program, and then we each invited a few people and we ended up with 300 people in our first group, all volunteers including me, and then eventually it grew to 1,900 people. And we wrote and edited and illustrated and typeset and footnoted a 97,000-word almanac in five months. And everyone was a volunteer.
And what I will tell you about that book, besides it being a bestseller around the world, is it changed my life and it changed the life of a lot of other people. Because it gave us solace and it helped us see that action in community is possible. And that instead of cursing the system, we built a different system right next to it using some of the same tools. And I have it right here in front of me. And it’s always here in front of me, because it’s not gonna solve the problem, but it’s a metaphor for how we’re gonna solve the problem, which is see what we need to see, understand the decisions and the costs thereof, come up with a sort of what we can live with and pick. And perfect is elusive, but tomorrow’s gonna be here soon. So this is our chance to do something about that.
Annie: You know, I think one of the things that I love just sort of thematically with you is that. I think it’s so easy in this day and age, and I know that I’m victim to that even, even just in this conversation, that you can get sucked into this pessimism, you know, about humanity and being able to solve big problems and we all hate each other and all this stuff and you just, through this whole conversation, you’re just such a natural optimist. You just have such an optimistic view of humans and our ability to come together and cooperate and make big changes and reach big goals. And I think that The Carbon Almanac is such a good example of that.
Seth: So as, as we start to wrap this up, I want to share a story my mom, my late mom told me. She was the first woman on the board of the art museum in Buffalo, New York, where I grew up. And she came up with this idea before Antiques Roadshow that in order to get people who didn’t go to the museum to come, she would get two people from Sotheby’s to come and appraise things people found in their attic, candlesticks or whatever. And, she had to get a whole bunch of approvals, she got the Sotheby’s people to come, and there was a little article about it in the Buffalo Evening News. She came home Friday, and I could see that she was pretty tired, I was probably 14, and she said, what if no one comes? And then she said, then no one will know that no one came.
Annie: That is so wonderful.
Seth: And the next morning there were 5,000 people there.
Annie: Oh, oh my gosh.
Seth: So that’s where I learned it.
Annie: That is such an amazing story. It’s hard to follow that. What decision-making tool or idea or strategy would you want to pass down to the next generation of decision makers?
Seth: Ignore sunk costs.
Annie: I like that one. I would put that very high on my list as well. So, what do you think the impact on society would be if the Alliance actually succeeds in our mission to bring Decision Education to every K-12 student’s learning experience?
Seth: So you’ve already succeeded, because every time you bring decision-making teaching to one person, it spreads to other people. And the incremental advance of decision-making, giving agency to people who need it, will undermine manipulative systems and force us to align much more clearly and not use people as victims, particularly people of lower income or education. So, I’m not worried about every classroom. I’m worried about the next classroom. And it’s this incremental systems change. And then it will be normal. You know, it’s worth noting that philosophy used to include biology, chemistry, mathematics, and as each one of these things develops into a field, it stops being philosophy and starts being a field. You are pioneering a field and the ratchet only goes one way.
Annie: Oh my gosh. That’s so, I’m going to carry you around with me when people ask. That’s for sure. So for listeners who want to go online and learn more about your work or follow you on your blog, where should they start?
Seth: So I am not a victim of social media, because I, you will not find me on any of those platforms pretty much. But if you go to seths.blog, there’s 9,000 posts in a row, I haven’t missed one. And it’s seths.blog/tis, you can learn about the new book.
Annie: That’s amazing. So hopefully everybody will get this book along with the 20 other ones that you have written. You’re a prolific writer and you’ve made a profound impact on people for sure. For any books or articles, et cetera, that have been mentioned today, you can check out the show notes on the Alliance site and you’ll be able to find them. Seth, as always, I just, I love every conversation that we have. Thank you so much for joining today. I feel like I learn so much every time that I talk to you and I’m walking away from this conversation, for me personally, trying to really remember to not, you know, not get down, right? To be optimistic that the future is a bright place.
Seth: I get smarter every time I see you. Thank you for everything, Annie.
Annie: Thank you.
Show notes
Books
Purple Cow: Transform Your Business by Being Remarkable – Seth Godin (2003)
This Is Marketing: You Can’t Be Seen Until You Learn To See – Seth Godin (2018)
Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts – Annie Duke (2018)
Articles
The Power and Pitfalls of Education Incentives – Bradley M. Allan; Roland G. Fryer, Jr. (2011)
Increasing Organ Transplantation—Fairly – Jonathan D. Sackner-Bernstein; Seth Godin (2004)
Resources
Website
Podcast