The Power of Multidisciplinary Learning
This excerpt comes from a recent interview. I think you’ll enjoy it immensely.
You discuss the power of multidisciplinary learning. Do you have any example where the multidisciplinary learning has been especially powerful for you? Munger has a number of examples of him arriving at a solution faster than an expert in a field as a virtue of Munger using concepts from other fields?
If you were a carpenter you wouldn’t want to show up for a job with an empty toolbox or only a hammer. No, you’d want to have as many different tools at your disposal as possible.
Furthermore, you’d want to know how to use them. You can’t build a house with only a hammer. And there is no point in having a saw in your toolbox if you don’t know how to use it. In this sense we’re all carpenters. Only, our tools are the big ideas from multiple academic disciplines. If we have a lot of mental tools and the knowledge of how to wield them properly, we can start to think rationally about the world.
These tools allow us to make better initial decisions, help us better scramble out of bad situations, and think critically about what other people are telling us. You can’t over-estimate the value of making good initial decisions. Nothing sucks up your time like poor decisions and yet, perversely, we often reward people for solving the very problems they should have avoided in the first place. It’s a little weird, but in some organizations you’re better off screwing up and fixing it than making a simple, correct, decision the first time. Think about portfolio managers trumpeting how they’ve “smartly sold” a stock at a loss of 20%, saving them a loss of 50%, but which a wiser person never would have purchased in the first place. The sale looks smart, but the easier decision would have been avoiding misery from the get-go. That kind of thing happens all over the place.
Multidisciplinary thinking also helps with cognitive diversity. In our annual workshop on decision making, Re:Think Decision Making, we talk about the importance of looking at a problem in multiple dimensions to better understand reality and identify the variables that will govern the situation — whether it’s incentives, adaptation, or proximity effects. But the only way you’re going to get to this level of understanding is to hold up the problem and look at it through the lens of multiple disciplines. These models represent how the world really works. Why wouldn’t you use them?
One important thing, for example, we can learn from ecology, is second order thinking — “and then what?” I think that a lot of people forget that there’s a next phase to your thinking, and there’s a second and third order effect. I’ve been in a lot of meetings where decisions are made and very few people think to the second level. They get an idea that sounds good and they simply stop thinking. The brain shuts down. For example, we change classification systems or incentive systems in a way that addresses the available problems, but we rarely anticipate the new problems that will arise. It’s not easy. This is hard work.
Another example is when a salesman comes into a company and offers you some software program he claims is going to lower your operating costs and increase your profits. He’s got all these charts on how much more competitive you’ll be and how it will improve everything. You think this is great. You’re sold. Well the second order thinking is to ask, how much of those cost savings are going to go to you and how much will be passed on to the customer? Well to a large extent that depends on the business you’re in. However, you can be damn sure the salesman is now knocking on your competitors’ door and telling them you just bought their product. We know thanks to people like Garrett Hardin, Howard Marks, and disciplines like ecology that there are second and third order effects. This is how the world really works.
Munger’s got a brain that I don’t have. I have to deal with what I’ve got. I’m not trying to come up with the fastest solution to a problem. It’s great to have a 30 second mind, but it’s not a race. Part of the issue I see over and over again is not that people don’t have the cognitive tools, but rather they don’t have time to actually think about a problem in a three-dimensional way.