Monday, 26 May 2008

The Story Database: How we really make decisions

Knowledge is comprised of stories. We watch television, go to movies, read books, and have conversations in which we exchange stories, because the mind is basically a database of stories. Stories have been exchanged since caveman days. Our mental apparatus is based on them. Numbers are much more recent idea. The mind is not set up for them, which is why mathematics is taught in school in every year.

Curiously, although we love to tell stories, it is rare that we learn from other peoples’ stories. Why do we tell stories if others will not remember them? The answer is that we like to hear ourselves talk, and actually, we learn a lot from hearing ourselves talk. So we (pretend to) listen to others to get them to listen to us. We are not consciously pretending, but we also are not really gaining much from what we hear.

One wonders why we don’t realize that no one really is listening to us. Except that in the end, it doesn’t matter if the listener is really listening or remembering what has been said. If people like talking, let them talk. If sometimes you can resonate to a story that someone else tells you and become in some way different because of this experience, well that’s nice to know. It gives us hope that not all of our stories will fall on deaf ears. But really gaining from someone else’s story is the exception, not the rule. This is because there are so many conditions required of the story we are hearing to make it memorable, e.g., it has to relate to something we know and care about, it has to be surprising in some way or change what we thought before in some way, etc.

Our knowledge base is composed of our own stories. It really doesn’t matter that much if others profit from hearing our stories. We profit from telling them because we solidify what we know. Each time we tell stories, we teach ourselves the point of the stories. The more stories we experience that share the same point, the more we can glean a larger lesson about the point itself, apart from the specific memories that illustrate it. In this way, when we tell stories, we create for ourselves lessons about our own views.

We profit from others’ stories when they are told “just in time” – at a moment when we are ready to compare them to the stories that define us, to perhaps become more sophisticated about what we know. When you deeply care about what is being said, you can ponder a story you have heard and make it your own. Unfortunately, that just doesn’t happen very much of the time.

In order to comprehend, learn from, and remember what you hear, you have to already think something about what you are being told, you have to care about it, and it has to cause you to revisit what you thought you knew, and modify your thought.

This tells us something about how we make decisions. In the popular imagination, people ponder all the variables, weigh the factors, analyze the numbers, and come to a conclusion. The reality is quite different.

In fact what we do, when faced with the need to make a decision is we try to think of what story we already know that matches the situation we are in. We recall the decisions made in that story and how they turned out, and then we decide on that basis. In other words, we tell ourselves a story and see if we already know that one and how it ended.

In business, we are supposed to comprehend and learn from the stories that are being told to us. In school people talk and no one listens, as is normative in everyday listening. But when we behave that way in business, people get upset, so business people learn to appear to be paying attention. They look at the numbers seriously and try to ask financial analysis questions. But those are never the real questions.

Children don’t learn when their parents tell them things. Why not? The reason is simple: they don’t hear what you are saying to them. They are thinking about their own stories. Business people are just better at faking it.

All humans behave this way. They are absorbed in, or trying to, construct their own stories. When they succeed at this they tell them to others to see if they sound right. This is why, when something important happens to us we must tell somebody. We need to comprehend it and we need to solidify that memory for later recall. So we talk.

People remember stories that are well told, and that are centered on ideas the listeners either know well or want to know well. Stories told in numbers are never well told, because people don’t think in numbers. People think about goals, plans, expectation failures, explanations, and goal conflicts. If you don’t talk in that language, you will not be understood. Movies makers know this. Most business people do not.

People remember experiences they have been a part of. And, a good story teller makes listeners become part of an experience. They make you feel that you are there. A good businessman learns to tell stories that will be heard. These stories must relate well to stories his listeners already know. The listener is simply constructing his own stories. He matches his new constructions to stories he already has and makes decisions. Numbers are a very small part of this process. Recognizing one’s own past successes and failures, stored as part of one’s own story database, is the key issue in the process of decision making in business. Everything else is window dressing.

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