How Flawed Analogies Destroy Businesses

Try to go through a day without using an analogy. I guarantee you'll fail within an hour. Your morning coffee tastes like yesterday's batch. Traffic is moving like molasses. Your boss sounds like a broken record. Every comparison you make—every single one—is your brain's way of understanding the world. You can't turn it off.

When someone told you ChatGPT is “like having a smart assistant,” your brain immediately knew what to expect—and what to worry about. When Netflix called itself “the HBO of streaming,” investors understood the strategy instantly. These comparisons aren't just convenient—they're how billion-dollar companies are built and how your brain actually learns.

The person who controls the analogy controls your thinking. In a world where you're bombarded with new concepts every single day—AI tools, cryptocurrency, remote work culture, creator economies—your brain needs a way to make sense of it all. By the end of this episode, you'll possess a powerful toolkit for understanding the unfamiliar by connecting it to what you already know—and explaining complex ideas so clearly that people wonder why they never saw it before.

Thinking in analogies—or what's called analogical thinking—is how the greatest innovators, communicators, and problem-solvers operate. It's the skill that turns confusion into clarity and complexity into something you can actually work with.

What is Analogical Thinking?

But what does analogical thinking entail? At its core, it's the practice of understanding something new by comparing it to something you already understand. Your brain is constantly asking: “What is this like?” When you learned what a virus does to your computer, you understood it by comparing it to how biological viruses infect living organisms. When someone explains blockchain as “a shared spreadsheet that no one can erase,” they're using analogy to make an abstract concept concrete.

Researchers have found something remarkable: your brain doesn't actually store information as facts—it stores it as patterns and relationships. When you learn something new, your brain is literally asking “What does this remind me of?” and building connections to existing knowledge. Analogies aren't just helpful for communication—they're the fundamental mechanism of human understanding. You can't NOT think in analogies. The question is whether you're doing it consciously and well, or unconsciously and poorly.

The quality of your analogies determines how quickly you learn, how deeply you understand, and how effectively you can explain ideas to others.

Remember this: whoever controls the analogy controls the conversation. Master this skill, and you'll never be at the mercy of someone else's framing again.

The Crisis of Bad Analogies

Thinking in analogies is a double-edged sword. I learned this the hard way.

A few years ago, I watched a brilliant engineer struggle to explain a revolutionary idea to executives. He had the data, the logic, the technical proof—but he couldn't get buy-in. Then someone in the room said, “So it's basically like Uber, but for industrial equipment?” Instantly, heads nodded. Funding approved. Project greenlit. One analogy did what an hour of explanation couldn't.

Six months later, that same analogy killed the project. Because “Uber for equipment” came with assumptions—about pricing, about scale, about network effects—that didn't actually apply. The team kept forcing their solution to fit the analogy instead of recognizing when the comparison broke down. I watched millions of dollars and two years of work disappear because nobody questioned whether the analogy was still serving them.

The same mental shortcut that helps you understand new things can also trap you in outdated patterns.

Consider Quibi's spectacular failure. In 2020, Jeffrey Katzenberg and Meg Whitman launched a streaming service with $1.75 billion in funding—more than Netflix had when it started. Their analogy? “It's like TV shows, but designed for your phone.” They created high-quality 10-minute episodes optimized for mobile viewing. Six months later, Quibi shut down.

What went wrong? The analogy was flawed. They assumed mobile viewing was like TV viewing, just shorter. But people don't watch phones the way they watch TV—they watch phones while doing other things, in stolen moments, with interruptions. YouTube and TikTok understood this. They built for distraction and fragmentation. Quibi built for focused attention that didn't exist. That misunderstanding burned through nearly $2 billion in 18 months.

We see this constantly where complex issues get reduced to simplistic analogies that feel intuitive but lead to flawed conclusions. Someone compares running a country to running a household budget—”If families have to balance their budgets, why shouldn't governments?” The analogy sounds intuitive, but it ignores that countries can print currency, carry strategic long-term debt, and operate on completely different time horizons than households.

The cost of bad analogical thinking is enormous. You waste time applying solutions that worked in one context to problems where they don't fit. You miss opportunities because you're trying to squeeze new situations into old patterns. And worst of all, you become easy to manipulate—because anyone who controls your analogies controls how you think.

How To Think Using Analogies

So how do we harness the power of analogy while avoiding its traps? Let me show you five essential strategies that will transform how you use comparison to understand your world.

Generate Analogies Systematically

The first skill is learning to create useful analogies on demand. Most people wait for analogies to pop into their heads randomly, but you can develop a systematic process for generating them whenever you need one.

Map the structure of what you're trying to understand, then search for similar structures in domains you know well. Netflix's recommendation algorithm didn't come from studying other algorithms—it came from asking “How do humans recommend things?” and mapping that social process onto a technical system.

Steps to generate powerful analogies:

1. Identify the core function or relationship: Strip away surface details and ask what the thing actually does. A heart pumps fluid through a system. Now you can compare it to anything else that pumps fluid—engines, wells, plumbing systems.
2. Look across multiple domains: Don't limit yourself to obvious comparisons. The best analogies often come from unexpected places. The inventor of Velcro, George de Mestral, understood how burrs stuck to fabric by comparing them to hooks and loops—leading to a billion-dollar fastening system.
3. Map specific correspondences: Once you find a potential analogy, be explicit about what maps to what. If you're comparing your startup to a marathon, what corresponds to training? What's the equivalent of hitting the wall? What represents the finish line?
4. Test the analogy's limits: Push the comparison and see where it breaks down. This isn't a failure—it's information. Every analogy has boundaries, and knowing them makes the analogy more useful.
5. Consider multiple analogies: Don't settle for the first comparison that works. Electricity is like water flowing through pipes AND like cars on a highway. Each analogy reveals different insights.

Recognize When Analogies Break Down

Most people fall in love with an analogy and push it beyond its useful range. A powerful analogy becomes a dangerous one the moment you forget it's just a comparison, not reality itself.

The human brain loves patterns, and once we find one that works, we want to apply it everywhere. This is how we end up with terrible advice like “Just be yourself in job interviews” because “authentic relationships require honesty”—taking an analogy from personal relationships and stretching it to professional contexts where it doesn't fit.

How to recognize the breakdown:

1. Watch for forced mappings: If you find yourself struggling to make pieces fit, the analogy might be wrong. When the comparison starts requiring elaborate explanations or special exceptions, it's probably breaking down.
2. Check for contradictory predictions: A good analogy should help you predict behavior. If your analogy suggests one outcome but reality keeps producing another, the comparison isn't working.
3. Look for what's missing: What does the analogy leave out? Understanding the gaps is as important as understanding the matches. Social media isn't “the modern town square”—because town squares had time constraints, physical presence, and social accountability that platforms lack.
4. Test edge cases: Push your analogy to extremes. If “your body is a temple,” does that mean you should let tourists visit? When an analogy gets absurd at the edges, you've found its limits.

A good analogy is a map, not the territory. The moment you forget that, you're lost.

Use Analogies to Explain Complex Ideas

Analogies are your secret weapon for making complicated concepts accessible to anyone. The person who can explain quantum physics using everyday comparisons has a superpower in our information-saturated world.

Match the analogy to your audience's knowledge and choose comparisons that illuminate rather than obscure.

The explanatory analogy playbook:

1. Know your audience's knowledge base: You can compare machine learning to “teaching a child through examples” for general audiences, but that same analogy won't work for computer scientists who need technical precision.
2. Start with the familiar: Always move from what people know to what they don't. “Imagine your favorite playlist, but instead of songs it recommends…” grounds abstract concepts in concrete experience.
3. Be explicit about the comparison: Don't assume people will automatically see the connection. Say “Think of it like this…” and make the mapping clear.
4. Use multiple analogies for complex concepts: One analogy rarely captures everything. Combine several different comparisons to give people multiple angles of understanding.

Identify False Analogies in Arguments

People will use analogies to manipulate your thinking—sometimes intentionally, sometimes not. Workplace debates are full of analogical arguments: “Remote work is like letting students do homework unsupervised—productivity will plummet.” But is professional work really like homework? The analogy assumes similarities that may not exist.

Recognizing false analogies protects you from being intellectually hijacked. When someone uses comparison to make their argument, your job is to evaluate whether the comparison is valid.

Your defense against false analogies:

1. Ask what's being compared: Make the analogy explicit. Often people use vague gestures toward similarity without stating exactly what maps to what.
2. Examine the relevant similarities: Are the things being compared actually alike in ways that matter to the argument? Comparing a business to a family sounds warm, but families don't fire members for poor performance.
3. Identify critical differences: What's different between the two things? Sometimes those differences destroy the analogy's validity. Saying “hiring is like dating” ignores that employment is a contractual relationship with completely different expectations and legal frameworks than romantic partnerships.
4. Consider alternative analogies: If someone says “Unlimited vacation policies are like giving employees a blank check,” counter with “Actually, it's more like trusting professionals to manage their own time like we trust them to manage budgets.” Different analogies suggest different conclusions.
5. Demand literal argument: When someone relies heavily on analogy to make their case, ask them to make the argument without comparison. If they can't, the analogy might be doing rhetorical work rather than logical work.

Build Your Analogy Library

The final strategy is long-term: deliberately expand your collection of mental models and experiences so you have more source material for analogies. The person who only knows their own industry can only draw comparisons from that narrow domain. But someone who reads widely, pursues diverse experiences, and studies multiple fields can make unexpected connections.

Steve Jobs famously took a calligraphy class—years later, those insights about typeface and design influenced the Mac's revolutionary interface. The analogy between typographic beauty and digital design wouldn't have been available without that cross-domain experience.

Building your source material:

1. Read across disciplines: Don't just consume content in your field. Read history, science, philosophy, biography. Each domain gives you new patterns to recognize elsewhere.
2. Study other industries: How do restaurants manage inventory? How do sports teams develop talent? These patterns might apply to your completely different context.
3. Learn the fundamental models: Some analogies recur because they capture universal patterns. Evolution, network effects, compound interest, equilibrium—these models apply across countless domains.
4. Practice deliberately: Make it a habit to ask “What is this like?” when you encounter new ideas. The more you practice generating analogies, the faster and better you'll become.

Practice

A practical and effective way to develop this skill is to practice explaining concepts across contexts.

Here's how you can sharpen your ability to think in analogies:

1. Choose a concept you know well: Pick something from your area of expertise—a technical process, a business strategy, a creative technique, whatever you know deeply.
2. Identify three different audiences: Consider explaining this concept to a child, to someone in a completely different profession, and to an expert in an unrelated field.
3. Generate three analogies: For each audience, create a different analogy that would make the concept clear. Force yourself to draw from domains that audience would understand.
4. Test your analogies: If possible, actually explain your concept to someone using your analogy. Watch their face—confusion means the analogy isn't working, clarity means it is.
5. Refine and iterate: Share your analogies with others and adjust based on their feedback. The best analogies often emerge through conversation and iteration.

This exercise trains you to think flexibly, draw connections across domains, and understand the mechanics of what makes analogies work or fail. The more you practice, the more naturally these comparisons will come to you when you need them.

The Rewards

Mastering analogical thinking is a journey, not a destination. It requires constant practice, intellectual curiosity, and the humility to recognize when your comparisons break down.

But the rewards are transformative. You'll learn faster by connecting new information to what you already know. You'll explain complex ideas with clarity that makes you invaluable in any professional setting. You'll spot flawed reasoning in arguments before others even notice something's wrong. You'll generate creative solutions by borrowing patterns from unexpected domains.

Most importantly, you'll develop the mental flexibility to navigate an increasingly complex world. When AI reshapes your industry, you'll understand it by comparison to previous technological disruptions. When new social dynamics emerge, you'll make sense of them by recognizing familiar patterns in new contexts.

The best thinkers aren't those who memorize the most facts—they're those who see connections others miss. Steve Jobs didn't invent the smartphone—he saw that a phone could be like a computer in your pocket. Jeff Bezos didn't invent retail—he saw that a bookstore could be like an infinite warehouse. Every breakthrough starts with someone asking “What if this is like that?”

That's the power of thinking in analogies. And now you have the tools to make it yours.

Your Thinking 101 Journey

The Thinking 101 series is teaching you how to think clearly in a world designed to confuse you—here's our journey so far:

In Episode 1, we exposed the thinking crisis—AI dependency is creating cognitive debt, and independent thinking has become the most valuable skill in the modern world.

In Episode 2, you learned to distinguish deductive certainty from inductive probability and stop treating patterns as proven facts.

In Episode 3, you discovered how to distinguish true causation from mere correlation—saving yourself from solving the wrong problem perfectly.

Today, you learned how to harness the power of analogies while avoiding their traps—generating useful comparisons systematically, recognizing when analogies break down, and spotting false analogies that manipulate thinking.

Up next—Episode 5: “Probabilistic Thinking—Living with Uncertainty.” You'll learn how to think in probabilities rather than certainties, make decisions with incomplete information, and act wisely when nothing is guaranteed.

Hit that subscribe button so you don't miss future episodes. Also—hit the like and notification bell. It helps with the algorithm so others see our content. Why not share this video with a colleague who you think would benefit from it?

Because right now, while you've been watching this, someone just pitched a billion-dollar idea using a flawed analogy—and investors nodded along because it “sounded like” something that worked before. The only question is: will you be the one who sees through it?

To learn more about thinking in analogies, listen to this week's show: You Think in Analogies Every Day (And You're Doing It Wrong).

Get the tools to fuel your innovation journey → Innovation.Tools https://innovation.tools

SOURCES CITED IN THIS EPISODE

1. Cognitive Science Research on Analogical Reasoning
   Green, A.E., Fugelsang, J.A., & Dunbar, K.N. (2006). Automatic activation of categorical and abstract analogical relations in analogical reasoning. Memory & Cognition, 34(7), 1414-1421.
   https://link.springer.com/article/10.3758/BF03195906
2. Brain Pattern Recognition and Memory Storage
   Gentner, D., & Smith, L. (2012). Analogical Reasoning. Encyclopedia of Human Behavior (Second Edition), 1, 130-136.
   https://groups.psych.northwestern.edu/gentner/papers/gentnerSmith_2012.pdf
3. Neuroscience of Analogical Thinking
   Parsons, S., Maillet, D., Sayfullin, A., & Ansari, D. (2022). The Neural Correlates of Analogy Component Processes. Cognitive Science, 46(3).
   https://pubmed.ncbi.nlm.nih.gov/35297092/
4. Quibi Shutdown and Funding Details
   Spangler, T. (2020). Quibi Confirms Shutdown, Jeffrey Katzenberg Startup Will Shop Assets. Variety. October 22, 2020.
   https://variety.com/2020/digital/news/quibi-confirms-shutdown-jeffrey-katzenberg-meg-whitman-1234812643/
5. Quibi Funding History
   Crunchbase. (2020). Quibi Is Shutting Down After Raising $1.75B In Funding. October 22, 2020.
   https://news.crunchbase.com/startups/quibi-shutting-down/
6. Steve Jobs Stanford Commencement Speech
   Jobs, S. (2005). ‘You've got to find what you love,' Jobs says. Stanford Commencement Address. June 12, 2005.
   https://news.stanford.edu/stories/2005/06/youve-got-find-love-jobs-says

ADDITIONAL READING

On Analogical Reasoning and Cognition
Holyoak, K. J., & Thagard, P. (1995). Mental Leaps: Analogy in Creative Thought. MIT Press.

Gentner, D., Holyoak, K. J., & Kokinov, B. N. (Eds.). (2001). The Analogical Mind: Perspectives from Cognitive Science. MIT Press.

On Thinking and Decision-Making
Kahneman, D. (2011). Thinking, Fast and Slow. Farrar, Straus and Giroux.

On Innovation and Cross-Domain Learning
Isaacson, W. (2011). Steve Jobs. Simon & Schuster.

Note: All sources cited in this episode have been accessed and verified as of October 2025.