The Brainy Business | Understanding the Psychology of Why People Buy | Behavioral Economics

Dealing with distractions is a common challenge that many professionals face in their everyday lives. Traction (the opposite of distraction) is the force that drives us towards our goals and objectives, keeping us focused on the tasks that really matter. In order to combat distractions, it's vital to create a plan that outlines the necessary steps for achieving success. This includes setting clear objectives and breaking down goals into manageable tasks, while also allocating specific time for relaxation or personal enjoyment.  By doing so, individuals can achieve a balanced life that fosters productivity and happiness. During this conversation with host Melina Palmer, Nir Eyal emphasized the importance of distinguishing between distraction and traction. Contrary to popular belief, the opposite of distraction isn't focus, but rather traction. Eyal explained that distractions are anything that pulls us away from our true goals, while traction is any action that brings us closer to achieving them. He urged listeners to create schedules that align with their values and to stick with them, ensuring that they devote the necessary time and focus to what truly matters. Enhance concentration through gaining traction and structured planning to mitigate distractions. Utilize technology with intention for peak productivity and enriching personal experiences. Overcome internal triggers by comprehending the nature of discomfort and controlling urges. Create value-driven schedules to bolster time management and sharpen focus. Employ tactical tools and approaches to curb the influence of digital distractions. Show Notes: 00:00:00 - Introduction, Melina Palmer introduces the episode and the guest, Nir Eyal, who is a behavioral designer. She talks about how Nir's book, Indistractable, helps people overcome distractions and become more productive. 00:04:30 - Personal Reason for Writing Indistractable, Nir Eyal shares his personal reason for writing Indistractable. He talks about how he was distracted by his phone while spending time with his daughter. Research and personal testing made him realize the problem was much deeper than just technology. He decided to explore the root cause of distraction and find an answer that actually worked. 00:09:40 - Distraction is an Old Problem, Nir talks about how distraction is not a new problem and has been with us for at least the past 2500 years. He explains how people have always blamed various forms of entertainment and technology for distracting them, and how it's lazy thinking to blame technology for distraction without understanding the root cause. 00:11:14 - The Opposite of Distraction is Traction, Nir Eyal explains that the opposite of distraction is not focus, but traction. He defines traction as any action that pulls you towards what you want to do, and distraction as any action that pulls you away from what you plan to do. He emphasizes the importance of understanding the difference between the two. 00:12:27 - Tools for Finding Balance, Nir Eyal talks about the importance of finding balance when it comes to using technology. He shares some tips and tricks anyone can use to help with this (a tiny sample of all the resources in his book). 00:13:47 - Understanding Distractions and Traction, Nir Eyal explains that distraction is anything that pulls us away from what we planned to do and anything can be a distraction. Conversely, anything can be traction if we make time for it and plan it according to our values. Becoming indistractable means living with personal integrity and knowing why we got distracted. 00:18:28 - The Root Cause of Distraction, Eyal identifies the root cause of distraction as our inability to deal with discomfort in a healthy manner. We use distraction as psychological pacification and escape uncomfortable emotions. To become indistractable, we must first learn to deal with the discomfort in a healthy way by fixing the source of discomfort or finding ways to cope. 00:19:48 - Human Motivation, Nir explains that human motivation is not about the pursuit of pleasure and avoidance of pain but rather spurred by discomfort. We have two neural circuits, the liking system and the wanting system. The purpose of the wanting system is to create discomfort to get us to act. Time management is pain management, and to master distractions, we must first master internal triggers. 00:22:21 - Time Management and Addiction, Addiction isn't just about substances or behaviors but is more about our need to escape from discomfort. We must fix the source of discomfort or learn to deal with it in a healthier way. Eyal shares the story of Dr. Zoe Chance, who became temporarily addicted to her pedometer as she was using it to escape her life. 00:27:21 - The Evolution of Internal Triggers, Evolution has made us perpetually perturbed and hardwired for things like hedonic adaptation, rumination, and boredom to keep us searching for more. We are not designed by evolution to be satisfied, but to strive, search, want, and crave, which helped our species progress. The idea is to channel these uncomfortable sensations towards traction rather than distraction. 00:29:21 - Mindset and Reimagining Temptation, Our brains are wired for mindset issues, and we need to reimagine our temperament to become indistractable. If we have an issue, we need to understand the root cause and channel our mindset towards traction instead of distraction. We can reimagine the task, trigger, or our temperament to master the internal triggers, which is crucial to becoming indistractable. 00:32:00 - The Nuances of Technological Distraction, Our relationship with technology and other distractions is a nuanced discussion. Everything has unintended benefits and harms, and it is crucial to take a deeper look. We need to understand the good stuff that's happened and not just the negatives. If something is not serving us, we should disconnect and use what we want with intent. 00:35:23 - The Story Behind the Moral Panic, Every moral panic throughout the years has had a scapegoat, and this time, it's technological distraction. It's dangerous to believe in scientifically unsupported theories, which leads to learned helplessness. The evidence is scant, and the story is much more nuanced. 00:41:33 - Why We Need to Become Indistractable, Nir Eyal talks about how constant interruptions from Facebook and the news distract us and how hacking back our phones and offices can help us become indistractable. 00:42:14 - How Distractions Come from Colleagues, Eyal discusses how distractions from colleagues in open-office plans can impede work progress and how a simple explicit message can help. 00:43:10 - The Role of Pre-Commitments, Eyal explains how pre-commitments can help prevent distraction and promote personal integrity. 00:48:29 - The Antidote to Impulsiveness, Eyal emphasizes that the antidote to impulsiveness is forethought and how we should use our ability to see into the future to plan ahead. 00:50:08 - Conclusion, Melina's top insights from the conversation. What stuck with you while listening to the episode? What are you going to try? Come share it with Melina on social media -- you'll find her as @thebrainybiz everywhere and as Melina Palmer on LinkedIn. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! Learn and Support The Brainy Business: Check out and get your copies of Melina’s Books.  Get the Books Mentioned on (or related to) this Episode: Indistractable, by Nir Eyal Hooked, by Nir Eyal Influence is Your Superpower, by Zoe Chance What Your Customer Wants and Can’t Tell You, by Melina Palmer What Your Employees Need and Can’t Tell You, by Melina Palmer Connect with Nir:  Nirandfar.com Nir on Twitter Nir on LinkedIn Top Recommended Next Episode: Influence is Your Superpower, by Zoe Chance Already Heard That One? Try These:  Availability (ep 15) Habits (ep 256) The Power of Habit (ep 22) How to Set, Achieve & Exceed Brainy Goals (ep 70) Tips To Overcome Imposter Syndrome (ep 13) How to Get (and Stay) Motivated (ep 67) Resolutions and Keeping Commitments (ep 29) Sense of Hearing (ep 27) How To Organize Your Brain with Behavioral Economics (ep 83) Bikeshedding (ep 99) Planning Fallacy (ep 114) Temptation Bundling (ep 250) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter 3 Ways You Can Limit Everyday Distractions How This Year’s Nobel Prize Winning Research in Economics Can Help Your Business

In today's fast-paced world, attention spans are shorter than ever. By making stories concise, engaging, and to the point, marketers can cater to the needs of overwhelmed audiences while still delivering powerful messages. Short stories leave out unnecessary details while retaining the most critical elements, ultimately making them more memorable and easier to digest. David Paull considers short stories to be particularly useful tools in marketing and communications. He cites the popularity of TED Talks as evidence that people are drawn to concise yet impactful stories. In the podcast, he discusses the importance of refining messages through a careful editing process, distilling them down to their most essential aspects, and making them as powerful and engaging as possible. In this episode: Unleash the potential of behavioral storytelling to revolutionize your branding and marketing efforts. Learn how Dialsmith dials offer an innovative way to non-consciously measure audience reactions. Discover how to implement the RSPCT framework for designing impactful and convincing messages. Realize the significance of concise, emotionally charged stories for capturing your audience's interests. Leverage testimonials and social proof to amplify your persuasion techniques. Show Notes: 00:00:00 - Introduction, Melina Palmer introduces David Paull, CEO of Dialsmith and founder of Lillian Labs. She highlights David's expertise in using storytelling to build brands and introduces his behavioral storytelling framework. 00:04:02 - Dialsmith, David Paull talks about Dialsmith, his insights technology company that develops dials used in focus groups during presidential debates and State of the Union addresses. He also discusses the online version of the dials and the consultancy arm of the company, Lillian Labs. 00:11:56 - Storytelling, David shares his journey in becoming interested in storytelling through his work on strategic communications and messaging. He talks about how he got involved with the Story Conference in Nashville and the experiments and thought exercises he did on cognitive biases and behavioral economics. 00:15:33 - Behavioral Storytelling, David Paul explains how he blends insights and storytelling to create behavioral storytelling. He provides an example of working with clients on climate issues and how they isolate the real problem and test their messaging with the market. The goal is to take the audience on an emotional or intellectual journey that leads to action. 00:19:25 - TEDxPortland, David Paul discusses his involvement with TEDxPortland, the largest indoor TEDx in the world. He talks about the importance of having a diverse group of speakers and how they select the speakers for the event. 00:16:25 - The RSPCT Framework, David Paull discusses his RSPCT Framework, which involves determining the real problem for the target audience, understanding what's at stake if the problem is not solved, identifying the perfect outcome, crafting an effective call to action, and providing testimonials and social proof for added credibility. 00:19:23 - The Danger of Stressing the Problem, Melina Palmer and David Paull discuss how stressing the problem too much can lead to unintentional normalization of the behavior you want to change. Instead, they highlight the importance of including testimonials and social proof to make the audience feel comfortable with the solution being proposed. 00:24:56 - Tips on Delivering a TED Talk, David Paull shares his experience as a speaker coach for TEDxPortland. He emphasizes the importance of keeping talks short, with a focus on big original ideas and tangible takeaways. He also recommends a strong emphasis on editing to distill the message down to its most essential elements. 00:27:38 - The Power of Short Stories, Melina Palmer and David Paull highlight the power of a short story to convey complex ideas in a short amount of time. They use examples from famous TED Talks, including one that was only two minutes and fifty-two seconds long. They emphasize the importance of making every word count to deliver a compelling message that resonates with the audience. 00:30:24 - Make It as Short as Possible, David Paull shares a quote from Albert Einstein about making scientific work. 00:31:51 - Finding the Real Problem, The first step in problem-solving is identifying the real problem. Keep peeling back the layers until you find the underlying issue by asking "why" until there's nowhere else to go. Then determine what's at stake and what the perfect outcome would be if the problem is solved. 00:32:34 - Using Storytelling to Evoke Emotion, Describing the perfect outcome in a way that can be felt is crucial. Storytelling evokes emotion, making it easier for people to make a decision. The call to action should demonstrate how your solution solves the real problem, alleviates what's at stake, and delivers the perfect outcome. 00:33:13 - Testimonials and Social Proof, Sharing testimonials and social proof will help people feel comfortable. It's important to tap into how people process information and make decisions. Using quantifiable data is better than squishy information when demonstrating the effectiveness of a solution. 00:33:47 - Additional Resources, The podcast episode mentions additional resources, including episodes on Herding and Social Proof, as well as a link to Michelle Auerbach's episode on the importance of emotion in decision-making. All resources can be found here in the show notes.  00:34:08 - Conclusion, Melina's top insights from the conversation, a recap of the RSPCT framework, and items for you to consider as you implement what you learn. What stuck with you while listening to the episode? What are you going to try? Come share it with Melina on social media -- you'll find her as @thebrainybiz everywhere and as Melina Palmer on LinkedIn. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! Learn and Support The Brainy Business: Check out and get your copies of Melina’s Books.  Get the Books Mentioned on (or related to) this Episode: The Life-Saving Skill of Story, by Michelle Auerbach Ted Talks: The Official TED Guide to Public Speaking, by Chris Anderson Contagious, by Jonah Berger A More Beautiful Question, by Warren Berger Daring Greatly, by Brene Brown Connect with David:  DavidPaull.com David on Twitter David on LinkedIn Top Recommended Next Episode: The Power of Storytelling, Michelle Auerbach Already Heard That One? Try These:  Anchoring (ep 11) Find Your Purpose, with Gina Bianchini (ep 263) The Importance of Connection, with Nick Epley (ep 265) Framing (ep 16) IKEA Effect (ep 112) Reciprocity (ep 238) The Science of Cool, with Troy Campbell (ep 169) Social Proof (ep 87) Herding (ep 264) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter

Stories have a tremendous impact on the way we perceive the world and make decisions. They are deeply rooted in our human nature and can be incredibly effective for marketing and brand strategy. Utilizing storytelling in marketing creates an emotional connection with the audience, which is integral for influencing decisions and shaping behavior. Stories have a unique ability to captivate attention, evoke emotions, and create a sense of empathy with the characters, all of which are powerful tools for businesses to reach their target customers. During the podcast, Michelle Auerbach shared the importance of focusing on a specific character or situation when crafting a story, to achieve a strong emotional impact. By providing a relatable context, stories can effectively communicate complex messages and ideas that may get lost or appear less engaging when presented as plain data or statistics. Auerbach emphasized that incorporating storytelling into marketing and brand strategy can be an essential factor for success, as it encourages the audience to connect with the brand and take action that benefits everyone involved. Master the art of storytelling for influencing human behavior and boosting your business potential. Implement the three-point story arc for powerful communication and establishing deeper connections. Trigger emotions through captivating storytelling techniques that drive decision-making and prompt action. Reinforce group cohesion and empathy through genuine and relatable stories. Show Notes: 00:00:00 - Introduction, Melina introduces the episode and its focus on the power of story. She explains that over the next few weeks, there will be guests discussing various aspects of storytelling in life and business. 00:03:14 - Michelle Auerbach's Background, Michelle talks about her childhood and her love for stories, which led her to pursue a degree in literature and a career in teaching that as well as ancient world languages. She then transitioned to organizational change and leadership development, using storytelling to help organizations develop culture and change. 00:06:01 - Story's Role in Change Management, Michelle explains how story impacts change management in several ways. Story has a somatic impact on the brain, helps with co-regulation, facilitates learning, and helps people see possibilities they wouldn't otherwise see. Story also helps people focus and remember information, and it produces cortisol and oxytocin, which encourage pro-social behavior. 00:11:10 - The Power of Story in Marketing and Brand Strategy, Melina and Michelle discuss how storytelling is used in marketing and brand strategy. Michelle explains that storytelling can help organizations connect with their audience by creating empathy and helping people understand the impact of their work. By focusing on one person's story, it can create a powerful emotional response and motivate people to take action. 00:13:29 - The Biology of Storytelling, Michelle explains the biology of storytelling and how it impacts the brain. Story produces cortisol and oxytocin, which help people focus and remember. 00:14:50 - The Importance of Storytelling in Business Michelle shares her expertise in storytelling and how it can be applied to business. She emphasizes the power of story in bridging gaps in communication, sharing scientific information, and even changing perspectives. She also suggests a simple three-part story structure that can be used in presentations, conversations, and even conflict resolution. 00:19:28 - Different Story Structures Michelle talks about the diversity of story structures found in different cultures and how they can be used in storytelling. She gives examples of Japanese and West African story structures and emphasizes the importance of not forcing one's own story structure on others. She also suggests ways to learn about other people's favorite stories and how it can build affinity and rapport. 00:25:06 - Using Story Cubes to Open Up Melina shares her experience using Story Cubes in her workshops to help people open up and share more about themselves. Story Cubes are a fun tool that uses images to trigger memories and stories that people might not have shared otherwise. Michelle also shares her love for Story Cubes and how they can help people tap into different parts of their memories and experiences. 00:27:00 - Priming with Storytelling Michelle talks about the concept of priming and how it can be used in storytelling to set the tone and mood for an event or meeting. She gives examples of how organizations with a strong "why" or Credo can use storytelling to bring that purpose into the room and lead from that place. 00:28:59 - Using Story Cards, Michelle created story cards with pictures from art students to help people tell stories and add visuals to presentations. The details in stories evoke feelings that anchor learning and change. 00:30:25 - Using Visuals in Storytelling, Adding visuals to storytelling evokes feelings in another way and helps with group cohesion. It's using our biology to benefit learning and decision-making functions. 00:33:01 - Overcoming Biases with Storytelling, Storytelling helps overcome biases, especially status quo bias, by evoking feelings in the decision-making processes. It's important to make people feel the impact of a situation rather than just presenting data. 00:37:51 - Top Tips for Using Storytelling, Start by listening to other people's stories and figuring out what you like and what's possible for you to do. Practice being a good story listener and asking story questions. Then, tell stories from an authentic place and don't tell people how to feel about a situation. Instead, ask them to tell you about their own experiences. 00:41:26 - Storytelling for Behavior Change, Michelle shares her experience in Japan, where a doorman's story about wearing masks "for politeness" helped her quickly change her behavior. When telling stories, it's important to share your own motivations rather than telling people what to do or feel. 00:43:20 - The Power of Story, Michelle explains that storytelling has been part of human culture for thousands of years. She shares that stories are powerful because they evoke emotions, which are needed to make decisions. A good story is relatable and makes abstract concepts more tangible. By telling stories, you can help people understand and feel your message. 00:44:16 - Everyone Can Tell a Story, Michelle encourages people to embrace their storytelling skills. She says that everyone is born with the ability to tell a story and it's a skill that can be developed. Michelle suggests that to become a better storyteller, you should listen to stories and figure out your own storytelling style. Don't try to be someone else because it will be inauthentic and not work as well. 00:45:30 - Using Storytelling in Business, Michelle explains that storytelling can be used in business to help with change management, persuasive presentations, and creating compelling sales pitches. She recommends using a simple structure to tell stories, answering the questions: what's going on, what did you do, and what happened. The right metaphors and connections can make a story more powerful. 00:48:30 - Connecting Through Stories, Michelle shares that she includes a recipe in her weekly newsletter because food is part of cultural stories. She believes that by sharing stories and experiences, you can create connections with people. Michelle encourages people to use stories to engage with others and make them feel something. 00:49:13 - Conclusion, Melina's top insights from the conversation, a recap of Michelle’s three-part storytelling framework, and items for you to consider as you implement what you learned. What stuck with you while listening to the episode? What are you going to try? Come share it with Melina on social media -- you'll find her as @thebrainybiz everywhere and as Melina Palmer on LinkedIn. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! Learn and Support The Brainy Business: Check out and get your copies of Melina’s Books.  Get the Books Mentioned on (or related to) this Episode: The Life-Saving Skill of Story, by Michelle Auerbach A More Beautiful Question, by Warren Berger The Hype Handbook, by Michael Schein What Your Customer Wants and Can’t Tell You, by Melina Palmer Alchemy, by Rory Sutherland Connect with Michelle:  Michelle’s Website Michelle on Instagram Michelle on LinkedIn Top Recommended Next Episode: DOSE Brain Chemicals (ep 123) Already Heard That One? Try These:  Change Management (ep 226) Framing (ep 16) Novelty & Stories (ep 54) Priming (ep 252) Mirror Neurons (ep 31) IKEA Effect (ep 112) Availability (ep 15) Overview of Personal Biases (ep 45) Biases Toward Others – Including Groups (ep 46) Status Quo Bias (ep 142) Interview with Michael Schein ep 143) Expect Error (ep 39) Give Feedback (ep 40) Disney (ep 144) What is Behavioral Baking? (ep 155) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter

The manner in which we communicate plays an essential role in contributing to or easing microstress. With the proliferation of remote work and numerous communication channels, it is vital to be mindful and intentional in our communication with colleagues and acquaintances. Establishing positive communication norms can alleviate microstress and create a more collaborative and productive work environment. Rob Cross highlighted the need for thoughtful communication in his conversation with Melina Palmer. He shared that teams should establish clear communication norms, such as using bullet points rather than lengthy paragraphs, avoiding unnecessary CC in emails, and refraining from sending messages after a particular time. By adopting such positive communication practices, teams can work towards fostering a supportive workplace culture and minimizing the impact of microstress on all members. Unveil the methods for recognizing and neutralizing everyday workplace microstressors to elevate your work experience. Comprehend the ramifications of toxic relationships on your well-being and establish pathways for transformation. Benefit from Rob Cross's research on the microstress effect and its applications to your personal and professional sphere. Refine your communication skills to address microstress mindfully and cultivate enriching connections. Bring about small alterations that result in remarkable betterment of your holistic well-being. Show Notes: 00:00:00 - Introduction, Host Melina Palmer introduces Dr. Rob Cross, who is the Edward A. Madden Professor of Global Leadership at Babson College and the co-founder and director of the Connected Commons. The episode is about the new book he co-authored with Karen Dillon, The Microstress Effect. 00:03:02 - Background, Rob Cross talks about his background and his work with the Connected Commons, a consortium of over 150 leading organizations that sponsor research into ways of looking at networks and relationships in organizations. 00:06:32 - The Impact of Negative Relationships, Social psychology has shown that the negative interactions we have tend to have 3x to 5x the impact of the positive. Rob Cross shares his thoughts on the best practices for organizations to cultivate relationships that positively impact their employees' wellbeing. 00:08:15 - Resilience and Connections, Resilience is not just about grit and fortitude. It's about how we fall back on others in difficult times. Rob Cross discovered that there are eight predictable things we get from others when we have the connections in our lives. Without these, it's harder to navigate through difficult times. 00:12:23 - Understanding Microstress, Rob Cross shares how he stumbled onto the idea of microstress through his research. He found that there are 14 pretty consistent types of microstress that tend to accumulate around us each day and week at a pace and volume our brains just aren't designed to handle. These microstresses grow behind the scenes in a way that sneaks up on us until they become overwhelming. 00:14:55 - The Impact of Microstress, Rob discusses the impact of microstress on one's life, particularly when they are not aware of it. He talks about how the stress is just beneath the surface of awareness and can be creeping up on us. 00:17:09 - Types of Microstress, Rob explains that microstressors can come from different sources, including emails, instant messaging applications, and team collaborative spaces. He shares that it affects the metabolism differently, and people under this form of stress metabolize their meals differently. 00:22:44 - Cascading Effects of Microstress, Rob shares that microstressors can lead to cascading effects that people don't often think about. For example, a leader or stakeholder that shifts expectations can cause extra work, and employees may have to protect their team and go back into the team to keep engagement high. 00:24:24 - Tips on Dealing with Microstress, Rob suggests a table in the book with the 14 microstressors and categories of people where they come from, and answering three questions around them. He advises people to think about which stressors have become systemic in their lives and what stress they are creating for others. Rob also mentions the importance of finding groups outside of one's profession that they can be an authentic part of. 00:27:15 - Avoiding Getting into the Minutiae, Rob suggests focusing on getting out of the minutiae by finding groups outside one's profession that one can be an authentic part of. He shares that people who are happiest in this work typically have at least two or three groups outside their profession. 00:28:27 - The Impact of Traumatic Events, When experiencing a traumatic health diagnosis or event, people often reflect on what previously seemed important and realize it was insignificant. Those who maintain dimensionality in their life are better equipped to handle such events. Reflecting on interactions and adapting them can have a significant impact on how one feels day-to-day. 00:30:24 - The Impact of Communication on Stress, Poor communication habits, such as overdramatizing gossip or sending excessive emails, can lead to unnecessary stress and negative work interactions. Thoughtful and intentional communication, such as establishing positive norms and reducing unnecessary communication, can help reduce microstressors. 00:34:06 - Decreasing Collaboration Overload, Collaboration overload, where the amount of collaboration outweighs the increase in work, is a significant source of microstressors. By creating positive norms, such as bullet points instead of long paragraphs, or agreeing on a set number of emails per day, the collaborative footprint of work can be reduced. 00:37:36 - The Impact of Small Communication Habits, Small communication habits, such as sending vague or poorly-worded emails or leaving a negative aftertaste in interactions, can accumulate and have a significant impact on work stress levels. Thoughtful interactions, such as being intentional with emails or setting clear expectations for team collaborations, can help reduce microstressors. 00:41:20 - The Impact of Trust and Expectations, Lack of trust and unclear expectations can lead to stress when working on collaborative projects. People often work harder to compensate for small misses from team members, perpetuating the cycle of stress. Setting clear expectations and building trust can help reduce microstressors in collaborative work environments. 00:42:12 - Drains to Capacity, The 14 microstressors that affect our ability to get work done can be categorized as drains to capacity that hit us emotionally (such as worry or concern for people we care about), or value disconnects, where we slowly feel interactions moving us away from who we set out to be. 00:43:28 - Counterfactual Thinking, Dwelling on what had happened or what might happen in the future can be a big contributor to microstress. This can be interactions abroad where we are trying to protect our team, family, or friends. It can also be a conflictual conversation that needs to happen, which can cause disproportionate stress. 00:45:23 - Specific Ways to Manage Conflictual Conversations, Conflictual conversations can be cathartic and good for people if we keep things data-driven and do specific things. We tend to think a lot about it before, during, and after the interaction, and this can cause stress. There are specific ways to handle conflictual conversations that can reduce stress. 00:47:10 - Importance of Small Stuff, Small stressors in our lives and those of people around us can cause massive amounts of stress that are totally unnecessary. Often, we don't realize the impact that our actions are having on others. The book, The Microstress Effect, provides charts and mockups of questions to ask and ways to work through microstress to have an impact on our lives and those around us. 00:49:31 - Closing Thoughts, Melina's top insights from the conversation, and items for you to consider as you implement what you learn. What stuck with you while listening to the episode? What are you going to try? Come share it with Melina on social media -- you'll find her as @thebrainybiz everywhere and as Melina Palmer on LinkedIn. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! Learn and Support The Brainy Business: Check out and get your copies of Melina’s Books.   Get the Books Mentioned on (or related to) this Episode: The Microstress Effect, by Rob Cross and Karen Dillon The Fun Habit, by Mike Rucker Happier Hour, by Cassie Holmes Getting Along, by Amy Gallo  What Your Employees Need and Can’t Tell You, by Melina Palmer   Connect with Rob:  Rob on Twitter Rob on LinkedIn Rob’s Website Top Recommended Next Episode: Counterfactual Thinking (ep 286) Already Heard That One? Try These:   The Fun Habit, with Mike Rucker (ep 251) Happier Hour, with Cassie Holmes (ep 257) Negativity Bias (ep 223) Find Your Purpose, with Gina Bianchini (ep 263) The Importance of Connection, with Nick Epley (ep 265) Framing (ep 16) IKEA Effect (ep 112) Prefactual Thinking (ep 232) The Speed and Economics of Trust, with Stephen M.R. Covey (ep 148) Reciprocity (ep 238) Getting Along, with Amy Gallo (ep 269) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter

Counterfactual thinking (when we mentally "undo" events that have already happened and imagine different outcomes) can contribute to personal and professional growth when applied constructively. This type of thinking is closely related to prefactual thinking, which involves imagining future scenarios, alternatives, and opportunities. Both types of thinking can aid in regulating behavior, problem-solving, and goal setting, ultimately contributing to improved performance and success in life and business. This episode highlights the interplay between counterfactual and prefactual thinking and how both can foster unique perspectives and considerations that set individuals and businesses apart from the competition. There is immense value in adopting a curious, open-minded approach when engaging in these thought processes, which can ultimately lead to personal development, innovation, and cultivating a successful and resilient mindset. Here's some of what you'll get from this episode: Explore the intriguing effects of counterfactual thinking on emotions and behaviors. Identify the fine line between helpful and detrimental counterfactual thoughts. Learn effective tactics for managing counterfactual thinking in tough situations. Uncover the power of combining counterfactual and prefactual thinking for a winning strategy. Master transforming negativity into productive and positive actions.  Show Notes: 00:00:00 - Introduction, Melina Palmer introduces the podcast episode (a refresh from one that originally aired in October 2019) focusing on counterfactual thinking and how it is central to being human. She explains the different types of counterfactuals and the impact they can have on our emotions and way of thinking. 00:05:06 - Types of Counterfactuals, Melina explains the difference between upward and downward counterfactuals, omissions and commissions, rumination and undoing, and usual or extreme events. She encourages listeners to reflect on their own types of counterfactuals and how they have impacted them in the past. 00:09:25 - Target of Counterfactuals, Melina discusses how the target of counterfactuals can impact the thought process. She gives an example of how people tend to focus on themselves even when they are not to blame, which can lead to distress and anxiety. 00:13:32 - Example of Unhealthy Counterfactual Thinking, Melina provides an extreme example of unhealthy counterfactual thinking where a woman dwells over a nonevent at work and becomes distressed and angry, constantly dwelling over what the woman in HR did or didn't do and how she could have acted differently. 00:14:50 - Recap, Melina summarizes the key takeaways from the episode so far and encourages listeners to use counterfactual thinking as a tool for setting and achieving goals, while also being mindful of when it becomes unhealthy and causes distress. She reminds listeners to download the free counterfactual thinking worksheet (and get more resources) in the show notes. 00:14:57 - The Impact of Counterfactual Thinking, Counterfactual thinking can lead to spiraling thoughts and negatively impact interactions. Dwelling on negatives can be harmful and counterproductive. It's essential to focus on the present and not dwell on the past. 00:19:07 - A Study on Counterfactual Thinking, A study on counterfactual thinking found that over half of the respondents were undoing a traumatic event in their minds. The distress level and frequency of undoing did not differ based on whether the item being undone was usual or exceptional; omission or commission. 00:25:31 - Focus on Self, Those who were undoing the event in their minds were more focused on their own actions or the actions of their loved ones than the other driver's behavior, even though the other driver was (typically) at fault. This shows how quickly the brain can compartmentalize and can lead to feelings of regret, guilt, and responsibility. 00:28:54 - Recency of Undoing, The recency of the undoing process (note: this is not the recency of the event) impacted distress levels. Those who were still undoing the event were more distressed than those who had never undone or had undone in the past, but stopped. This suggests that undoing may be a distress-driven cognitive process. 00:31:15 - Changing Focus, The action that people actively undo overwhelmingly changes over time. People may focus on themselves and their actions in a particular circumstance, but the specific action that they focus on can vary. The lesson is to focus on the present and not dwell on the past. 00:31:47 - The Effects of Undoing, Continuously undoing can increase distress levels, and guilt is the only negative emotion uniquely related to undoing. Guilt related to controllable events declines over time, but excessive undoing can perpetuate distress. 00:33:21 - Self Esteem and Counterfactual Thinking, People with low self-esteem may focus on their inadequacies in their counterfactuals, leading to more distress. Highly distressed individuals undo more frequently, perpetuating their distress. 00:35:09 - The Benefits of Counterfactual Thinking, Counterfactual thinking is crucial in regulating behavior and reaching goals. Failing to reach a goal often leads to counterfactual thinking, but reframing it can improve behavior. Turning counterfactual thoughts into actionable next steps can help reach goals. Plus, the one, most important phrase to help you leverage counterfactual thinking and use it to your advantage. 00:38:37 - Moving Forward from Counterfactual Thinking, Moving on from counterfactual thinking is crucial to prevent it from taking over your life and work. Asking questions like, "What can I do differently next time?" can help reframe counterfactual thoughts into positive next steps. An example from the Olympics, and how to use that most powerful language. 00:41:25 - Positive Thinking, Reframing, and a Refreshed Close, Acting as if you were a silver-lining person can trick your brain into thinking that way. Mental reframes and curious questions can change everything and set you and your business apart. Consider how different things might be if you flipped your counterfactual thinking around. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! More from The Brainy Business: Get your copies of Melina’s award-winning books. Get the Books Mentioned on (or related to) this Episode: The Microstress Effect, Rob Cross and Karen Dillon What Your Employees Need and Can't Tell You, Melina Palmer Fierce Conversations, by Susan Scott Quit, by Annie Duke Power of Regret, by Dan Pink Top Recommended Next Episode: Prefactual Thinking (ep 232) Already Heard That One? Try These:  The Top 5 Wording Mistakes Businesses Make (ep 2) How To Set Up Your Own Experiments (ep 63) Vulnerability Loops (ep 229) Questions or Answers (ep 4) Relativity (ep 12) Game Theory (ep 228) The Power of Regret, with Dan Pink (ep 214) Both/And Thinking, with Wendy Smith (ep 261) The Elements of Choice, with Eric Johnson (ep 174) Quit, with Annie Duke (ep 227) Priming (ep 252) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter  How to Break the Negative Cycle of ‘What If’ Thinking Improving Physical Task Performance with Counterfactual and Prefactual Thinking When Thinking It Means Doing It: Prefactual Thought In Self-handicapping Behavior Fixing Your Brain: A Guide to Balancing Neurotransmitters The Functional Theory of Counterfactual Thinking Norm Theory: Comparing Reality to Its Alternatives The Undoing of Traumatic Life Events

In this episode of the Brainy Business podcast, host Melina Palmer interviews Carlos Hoyos, a behavioral scientist and content creator from Latin America. They discuss the challenges of creating content in a non-English language and the importance of making behavioral science accessible to a wider audience. Hoyos shares his approach to creating content, including his YouTube channel, Behavioral Pills, and his e-learning platform, which offers one-hour sessions on various behavioral science frameworks. The conversation highlights the need for more diverse voices in the behavioral science community and the opportunities for growth and learning in different regions around the world. Show Notes: [00:42] Welcome Carlos Hoyos, Senior Behavioral Designer at BeWay, and Co-Founder at Kestudio. [02:19] Behavioral science is important everywhere.  [03:42] Carlos shares about himself, his background, and the work he does in behavioral science.  [05:35] In recent years he has dedicated his whole career to developing his knowledge in terms of behavioral science and design and specifically to find ways to apply it in business.  [07:15] Carlos was named Content Person of the Year by Habit Weekly. (Merle van den Akker – last week’s guest – and I were both finalists as well – congrats Carlos!)  [10:15] There are many companies now that are investing in behavioral science in Latin America.  [13:12] He sees himself as a content curator because he shares what other good professionals are doing.  [14:46] People love to talk about human behavior. It really connects to people.  [16:36] He found that there is so much information out there in English. Instead of being just one more, he decided to focus on Spanish because there is so little in Spanish right now.  [19:32] Daring to do the thing no one else has done yet is what helps people to stand out.  [22:20] Carlos shares some of the work he is doing with BBVA. They have merged behavioral science into day-to-day decision-making.  [24:53] One project they worked on at BBVA was with credit cards. People weren’t interested in applying for the credit cards because of a lack of trust – they wanted to change that.  [27:34] Experimentation and testing are a must in their projects.  [29:20] In 2022, they did more than 130 experiments in different areas of the business and that actually represented an extra income of around 45 million euros in the year.  [30:46] There are so many little things where behavioral science can make a very big impact in any type of business all around the world.  [32:20] There is plenty of opportunity and room for growth in behavioral science – in the US and around the world.  [35:16] The stress on the brain when you are trying to hurry and rush leads to problems that have to be fixed down the line.  [37:23] Experimenting and testing every decision you want to make will help you make better decisions now and for the future.  [38:42] If you torture the data long enough it will confess to anything.  [41:34] Carlo’s Behavioral Pills are one-hour e-learning sessions where he explains things concepts he considers basic for a behavioral scientist to know.  [43:33] Melina’s closing thoughts [45:03] Don’t be scared of being first. There are lots of people like you who have done this in their own way or their own language.  Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! Learn and Support The Brainy Business: Check out and get your copies of Melina’s Books.  Get the Books Mentioned on (or related to) this Episode: Outsmart Your Brain, by Dan Willingham Good Habits, Bad Habits, by Wendy Wood Predictably Irrational, by Dan Ariely Evolutionary Ideas, by Sam Tatam Friction, by Roger Dooley Connect with Carlos:  Carlos Website Carlos on LinkedIn Carlos on YouTube Top Recommended Next Episode: How To Set Up Your Own Experiments (ep 63) Already Heard That One? Try These:  Saving Peru’s Environment One Nudge At A Time with BE OEFA (ep 195) Habit Weekly: A Discussion With Creator Samuel Salzer (ep 284) Dan Ariely Interview: Discussing Shapa, the Numberless Scale (ep 101) Nudges and Choice Architecture (ep 35) How To Change, an interview Dr. Katy Milkman (ep 151) Evolutionary Ideas with Sam Tatam, Ogilvy’s Global Head of Behavioural Science (ep 204) Herding (ep 264) Priming (ep 252) Where CX and Behavioral Science Meet, with Jennifer Clinehens (ep 141) The Speed and Economics of Trust, with Stephen M.R. Covey (ep 148) Friction, with Roger Dooley (ep 274) Sludge: What It Is and How to Reduce It (ep 179) Using Behavioral Science to Tackle Addiction with Richard Chataway (ep 134) Reciprocity (ep 238) Framing (ep 16) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter Behavioral Pills Website

In this episode of The Brainy Business podcast, host Melina Palmer interviews Samuel Salzer, founder of Habit Weekly, a newsletter that curates the latest in behavioral science research and news. Salzer discusses the importance of creating content that people actually want (imagine that!) and the value of putting good things out into the world. He also shares insights on building habits and behavior change, and how businesses can apply these principles to their marketing and customer engagement strategies. Overall, the episode highlights the power of behavioral science in shaping our daily lives and the importance of staying up-to-date with the latest research and trends. Show Notes: [00:40] Today’s episode is a refresh of my conversation with Samuel Salzer, founder of Habit Weekly. [02:06] It is so fun to see how much things have grown at Habit Weekly in these three years. They have a full team of people now, and they’ve been doing their awards for a few years as well. I was honored to have been a winner in the inaugural edition, and a finalist in multiple categories every year. [03:29] Samuel shares about himself, his background, and how he started working in behavioral science. He has always been an entrepreneur and started his first business at 16.  [05:02] He found human decision-making fascinating.  [06:44] He wanted to learn more about what we can do to support people in making behavioral changes in their lives.  [08:42] For his work he focuses on how to scale behavioral change.  [09:56] You are succeeding if you help create value for your users and customers, understand them better, and help find a good solution for their problems.  [10:38] Whether we like it or not, behavior is quite complex. We are complex beings living in complex environments.  [13:06] Most businesses look at reducing friction in their customer journeys. Sometimes increasing friction is a good idea too.  [16:06] We are really good at creating stories and narratives in our minds to support whatever thing we really want to do.  [18:28] Just the simple shift of taking the word from reward to consequence makes it feel heavier in a way that can change behavior.   [19:39] Each individual choice matters. [20:50] We are often trying to do things that remove a negative effect. [23:17] The concept of “eating the frog” is doing the hard thing first.  [25:45] Samuel felt like it was hard to stay up on the content and research in the field so he started sharing links on LinkedIn.  [26:53] This eventually evolved into Habit Weekly. It’s now a mailing list that sends content related to behavioral design on a weekly basis. [28:27] You know you found something people really want if they are reaching out to you asking you to create a mailing list. It doesn’t have to be difficult to start an email list if you understand what drives people.  [30:27] His goal is to make sure that anyone interested in applying behavior change has the best and latest insights every week. [35:21] This field of behavioral science is still in the adolescent phase. In the near future, it is going to move into this more mature phase that is more about the process and learning more about applying these concepts in the best way.  [37:21] Samuel is really excited about the better understanding in the next few years of how any organization can easily start applying these concepts.  [40:17] His superpower or wish would be to see the world through other people’s eyes. (Melina would like to be able to speak and read every language fluently.) [40:58] He also loves books and movies. A really good book or movie can help show the world from someone else’s perspective.  [44:44] Many businesses create content people don’t want. If you start from a place of sharing, reciprocity will kick in eventually and people will appreciate what you are doing and what to give back to you one way or another.  [46:18] Melina’s closing thoughts Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! More from The Brainy Business: Get your copies of Melina’s award-winning books.  Get the Books Mentioned on (or related to) this Episode: Friction, by Roger Dooley What Your Customer Wants and Can't Tell You, by Melina Palmer Sludge, by Cass Sunstein Nudge, by Richard Thaler and Cass Sunstein You Have More Influence Than You Think, by Vanessa Bohns Connect with Samuel:  Samuel’s Website Samuel on LinkedIn Samuel on Twitter Top Recommended Next Episode: Framing (ep 16) Already Heard That One? Try These:  How to Finally Change Your Behavior (So it Sticks) (ep 81) Loss Aversion (ep 9) Friction – What It Is And How To Reduce It, with Roger Dooley (ep 274) Time Discounting (ep 51) Partitioning (ep 58) The Overwhelmed Brain and Its Impact on Decision Making (ep 32) Optimism Bias (ep 34) What is BrainyTab? An Interview with the Founders Radu and Raluca Judele (ep 85) Reciprocity (ep 238) Booms and Busts (ep 30) How to Make Content People Can’t Help But Engage With, featuring Katelyn Bourgoin (ep 201) You Have More Influence Than You Think, with Vanessa Bohns (ep 197) Sludge (ep 179) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter  The Brain Science Behind Your Shopping Decisions (watch Melina’s TV interview!) Eat That Frog!: 21 Great Ways to Stop Procrastinating and Get More Done in Less Time Habit Weekly

In today's conversation, I am joined by Dr. Merle van den Akker. Merle is a behavioral scientist who has recently completed a Ph.D. at the Warwick Business School, studying the effect of different payment methods on personal finance management. She decided to leave academia to apply behavioral insights in the real world and has become a behavioral science manager at a financial well-being unit in an Australian bank. She continues to research and apply behavioral science to improve financial services and consumer (financial) well-being. Next to this, Merle is a science communicator, running the blog Money on the Mind, and the MoneyPsychologist TikTok account, where she disseminates insights from the intersection of behavioral science and personal finance. Last, to not leave academia behind fully, Merle also still teaches behavioral science as well as courses on fintech developments at top Australian universities. Merle was also a finalist for Content Person of the Year in the Habit Weekly Awards in 2022 along with myself and many other amazing content creators in the space including next week's guest who won the award last year. In today's conversation, we are talking about personal finance – both for individuals and how it applies to any business. Stress at home can impact performance at work, and there are some ways businesses can be helping their employees feel more comfortable -- and do better work -- if they are thoughtful about personal finances and what is going on in the world around them. Even if your company doesn't believe it is impacted by inflation or the massive layoffs that have been happening recently...think again. Merle and I dig in on how social media and other availability-bias- and herding-fueled messaging is impacting everyone, and what companies can be doing to help their employees to feel more secure and less stressed. Show Notes: [00:42] In today's conversation, I am joined by Dr. Merle van den Akker. Merle is a behavioral scientist who has recently completed a Ph.D. at the Warwick Business School studying the effect of different payment methods on personal finance management.  [02:21] Stress at home can impact performance at work and there are some ways businesses can help their employees feel more comfortable and do better work.  [04:34] Merle shares about herself, her background, and the work she does. She runs the Money on the Mind blog, where she writes about how behavioral science applies to personal finance.  [06:42] Spending on a credit card is incredibly different than spending with cash.  [07:37] With contactless payments, people tend to spend a bit more and then they actually have a much worse recall of what they spent.  [09:32] Mental accounting is expenditure and research tracking in your head.  [11:51] It is important to ask thoughtful questions in business and research.  [14:25] You have a mental and a physical account for savings and your credit whether you are in debt or not.  [16:54] Behavioral science can contribute positively to the cost of living crisis in major ways. When people act out of fear they don’t make great decisions.  [18:54] Learned helplessness is a very dangerous state to get into. You need to be able to get into a mindset where you are still able to act.  [21:50] Having too much pressure on people’s time is impacting their ability to do really good, thoughtful work.  [24:28] The present bias is a very inconvenient bias and is something you should be aware of.  [27:31] As an employee, it is important to know what would and would not work and ask for that from your employer. An employer should be open and expectant to have these conversations.  [30:36] There can be more thoughtful and creative solutions for ways employers can help that don’t cost them a lot of money.  [32:45] You can help be a solution for customers and employees by having this overall awareness of what is happening in the world and how that is going to be impacting behavior.  [34:09] If your brain is in overload the last thing it wants is ambiguity.  [35:42] You don’t want people to act out of fear because they will make decisions that don’t benefit anyone in the long run. That is something we should really try to avoid.  [37:53] Social media algorithms give you more of what you show interest in. Something may feel like it is everywhere, when in reality the algorithms are just showing it to you a lot.    [39:46] Always take the time in stressful moments to breathe and get out of that hot state to look and see what you can do differently.  [41:01] It is a win-win situation to have employees that are not just cowering under an enormous load of stress and fear and as a result being rendered almost nonfunctional.  [42:34] Melina’s closing thoughts. [43:01] If you focus on helping your people with more aspects of their lives then just what feels immediately relative to your bottom line can have really great impacts financially and otherwise.  Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! Learn and Support The Brainy Business: Check out and get your copies of Melina’s Books.  Get the Books Mentioned on (or related to) this Episode: Nudge, by Richard Thaler and Cass Sunstein What Your Customer Wants and Can't Tell You, by Melina Palmer Scarcity, by Sendhil Mullainathan and Eldar Shafir  Subtract, by Leidy Klotz The Power of Scarcity, by Mindy Weinstein Connect with Merle:  Money on the Mind Merle on Twitter Merle on LinkedIn Top Recommended Next Episode: Common Errors in Financial Decision Making with Dr. Chuck Howard (ep 213) Already Heard That One? Try These:  The Pain of Paying (ep 240) Hindsight Bias (ep 167) Time Discounting (ep 51) Common Errors in Financial Decision Making with Dr. Chuck Howard (ep 213) How To Set Up Your Own Experiments (ep 63) Mental Accounting (ep 282) That Time I Went Viral… with Dr. Daniel Crosby (ep 212) Survivorship Bias (ep 110) Herding (ep 264) Availability Bias (ep 15) Time Pressure (ep 74) The Overwhelmed Brain and Its Impact on Decision Making (ep 32) Loss Aversion (ep 9) Past, Present, and Future Biases  (ep 246) Expect Error: The "E" in NUDGES (ep 39) Give Feedback: The "G" in NUDGES (ep 40) Ambiguity Aversion (ep 243) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter Learned Helplessness Invest now, drink later, spend never: On the mental accounting of delayed consumption

You’re likely familiar with accounting, so perhaps you can gather that mental accounting is essentially about how we account for things in our mind. But, you may not realize that it isn’t just mental math. This is about how we tend to create separate accounts for things in our minds that feel concrete, but often aren’t. When I give examples in this episode today, which originally aired in the summer of 2019, you are going to find yourself saying, “Well, obviously that is how it works!” And then when you realize it doesn’t have to be that way…it's kind of mind-blowing, but in a good way.  Mental accounting is great in a lot of ways. It helps us to save money and prioritize things that we might have a harder time with if everything was all lumped together. But it doesn’t mean it is the ONLY way or even the right way. It might just be the best way our brains are doing it right now, and it is always a good thing when you can know the rules your brain is using to make its decisions as well as that of your employees, peers, customers, and more.  So, why are we talking about mental accounting today? It’s because this Friday I am joined by Dr. Merle van den Akker, an expert on psychology and personal finances who runs the Money on the Mind blog. When she is here on Friday we discuss how the stress of money (fear of losing a job, concern about inflation, and the like) can impact employees. And, we of course take it a step further to unpack what businesses should know about these topics to better support their employees and why, even if a company thinks this doesn’t have anything to do with them…it absolutely does. This kind of stress has a lot of economic impact on an organization, and it doesn’t have to be difficult to support employees and achieve that win-win. We specifically talk about mental accounting in the episode, making it the perfect time to refresh it and get you set up for success for Friday! Show Notes: [01:21] Our brains make rules all the time. Sometimes they are really valuable — mental accounting is a great thing in a lot of ways. Sometimes, they aren’t necessarily serving us well. [03:21] The concept of mental accounting was introduced by Nobel Prize winner Richard Thaler and is based on a human’s illogical approach to value in relative terms instead of looking at it as an absolute.  [06:00] Three examples of how mental accounting can impact the decisions we make. This concept is very ingrained in our brains.  [08:22] Money is commonly labeled as either: expenses, wealth, and income.  [10:48] Much like regular accounting in mental accounting, individuals will book and post any occurring or planned transactions to the mental account. However, small items may not be booked in the same way as a big item would be. As long as it is below a certain amount it doesn’t have to hit the mental account.  [12:38] We often don’t look at dollar bills and change the same.  [15:31] Similar to the process of rounding up change at the grocery store, adding a small amount to an already large payment doesn’t feel the same as having that payment on its own. This is because of decoupling.  [17:07] Vacations are enjoyed more when they are prepaid because it feels free.  [19:06] There are times when prepayment is necessary and beneficial for the overall enjoyment of an experience.  [22:34] When prepayment comes into play the impact of the payment gets completely wiped off the mental accounting sheet so its impact on the sheet becomes zero.  [25:11] Instead, internalize how the brain is wired to make its decisions around mental accounting.  [27:49] When it comes to wealth in these sorts of categories people are very influenced by paper gains and losses.  [29:26] Where you keep the money mentally or physically matters, but it also matters how you came across the money in question.  [30:53] The way you receive the dividend impacts your willingness to spend it.  [32:17] While it is easier to give cash than gifts, in many cases when the gift given is something someone really likes or enjoys it can have a greater value than giving cash.  [34:08] While losses should be lumped together, gains should be separated out to really feel their value. Don’t wrap all the Christmas presents in one box.  [35:14] Mental accounting affects more than just money.  [37:52] Context is important in the way people react.  [39:54] Talking on the phone is more enjoyable when you aren’t worried about how much it is going to cost you.  [41:57] If you struggle with work-life balance and want to make more time for yourself, your family, or date night, consider how the mental accounts for money were set up.  [43:47] Try to take a step back and have perspective on what’s a waste of time and how you could better allocate your mental time account.  [44:25] Melina’s closing thoughts Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! More from The Brainy Business: Check out Melina’s award-winning books. Get the Books Mentioned on (or related to) this Episode: Nudge, by Richard Thaler and Cass Sunstein What Your Customer Wants and Can't Tell You, by Melina Palmer Scarcity, by Sendhil Mullainathan and Eldar Shafir  Subtract, by Leidy Klotz The Power of Scarcity, by Mindy Weinstein Top Recommended Next Episode: Pain of Paying (240) Already Heard That One? Try These:  Costco (ep 47) Apple Card (ep 42) Overview of Personal Biases (ep 45) The Overwhelmed Brain and Its Impact on Decision Making (ep 32) Celebrating the First Year of the Podcast (ep 55) Overview of Personal Biases (ep 45) Framing (ep 16) Loss Aversion (ep 9) Time Discounting (ep 51) Booms and Busts (ep 30) What is Value? (ep 8) The Truth About Pricing (ep 5) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter  The Pain of Paying The Red and the Black: Mental Accounting of Savings and Debt The Pain of Paying Tightwads and Spendthrifts: An Interdisciplinary Review Always Leave Home Without It: A Further Investigation of the Credit-Card Effect on Willingness to Pay Invest now, drink later, spend never: On the mental accounting of delayed consumption Mental Accounting Matters Mental Accounting and Consumer Choice

In today's conversation, I am joined by Dr. Dan Willingham, a memory expert with a Ph.D. in Cognitive Psychology from Harvard. Dan’s new book Outsmart Your Brain (which we discuss today) will change your life. While the book is catered to K-16 learners (for example, it includes chapters on “how to take notes,” “how to listen to a lecture,” “how to read hard books,” and “how to take tests”) trust me when I say this book is for you and everyone you know. It is fascinating and will help you with any presentation you may give or meeting you will be in moving forward. Trust me, you’re gonna love this. A little more about Dan: His work has appeared in the Washington Post, The New York Times, and many other publications, and he is the author of several books – his writing has appeared in 18 languages! In 2017 he was appointed by President Obama to serve as a Member of the National Board for Education Sciences. Whether you want to be a better learner yourself or if you have kids (including college students) in your life whom you want to help be successful, this episode and book are for you. I can't wait to dive into this one because there is so much great stuff. Show Notes: [00:43] In today's conversation, I am joined by Dr. Dan Willingham. Dan earned his Ph.D. in Cognitive Psychology from Harvard University in 1990. [03:03] Dan shares about himself, his background, and the work he does.  He was trained as a cognitive psychologist.   [04:04] He shares his transition from basic researcher to applied researcher.  [07:02] Often, we assume people know that thing that we know so we miss key things when presenting. That means they don’t get value from your talk.  [08:41] There are things we know we should do that we find difficult to implement. Sometimes we really don’t know what is optimal to do. We tend to do things in the moment that we feel are working and are not that difficult. (But often, the harder/counterintuitive thing will make a much bigger impact.) [11:16] Does cramming work? Dan says, “kind of.” It depends on what your goals are. If you do not care about remembering something in the long term then crowding it all in right before you need to perform is actually fine.  [12:50] The only way to ensure that you remember things in the long term is if your learning happens over time rather than all crammed together.  [15:42] If you are trying to master a new skill or a new topic and you feel like you need to wait to start until you have more than small bits of time, don’t wait! The data shows this is actually optimal for learning and retention.  [18:2326] Creating that consistent study or work habit by time and not by task is very important.  [21:04] We all procrastinate. It is a natural tendency.  [22:37] The key thing is you have to give yourself permission to stop if you want to.  [24:26] The night of sleep is important in consolidating the memories that were formed during the day. If you don’t get much sleep or you get low-quality sleep you are tampering with the learning that you put so much time into the previous day.  [25:40] Your intention or your desire to learn contributes nothing to whether or not you will learn something. There are lots of things we want to remember but don’t.  [27:26] Memory loves meaning. That is the main way we remember.  [29:05] You draw memory out the same way that it went in.  [30:53] Memories are going to be queued by thoughts or by things in the environment later. The way you are going to be able to draw memories out most successfully is when the queue is a good match for the way you thought about the memory at the time you were trying to remember it.  [32:51] When you are storing something away, think to yourself, “How am I likely later to try and remember this?” and make that part of the way it becomes retrievable.  [35:48] How do you organize 94 tips in one book? He chose to sort them by task. It is organized by things you would do that entail learning (how to read hard books, how to take notes, etc).  [38:45] When there is a hierarchical organization in speeches you are expected to make connections among the different things that you are hearing. Because it is not a narrative it is difficult to make those connections.  [41:45] You want to reframe to highlight what you enjoy instead of what is making you procrastinate. Looking at it in this way helps you overcome that.  [44:43] Allocate time to different tasks to help you get to the tasks that you tend to procrastinate on. Do the hard task first.  [46:40] It is not that what you are doing now is ineffective. It is that it can be slightly tweaked to be significantly more effective.  [48:31] What’s the simplest tip in the book? Some data shows that chewing gum helps you to focus for 20 minutes. Give it a try if you like gum! [50:328] Melina’s closing thoughts [51:39] In understanding how your own brain is wired to learn as well as others, and then how to "outsmart it" every step of the way is pure gold. Thanks for listening. Don’t forget to subscribe on Apple Podcasts or Android. If you like what you heard, please leave a review on iTunes and share what you liked about the show.  I hope you love everything recommended via The Brainy Business! Everything was independently reviewed and selected by me, Melina Palmer. So you know, as an Amazon Associate I earn from qualifying purchases. That means if you decide to shop from the links on this page (via Amazon or others), The Brainy Business may collect a share of sales or other compensation. Let’s connect: Melina@TheBrainyBusiness.com The Brainy Business® on Facebook The Brainy Business on Twitter The Brainy Business on Instagram The Brainy Business on LinkedIn Melina on LinkedIn The Brainy Business on Youtube Join the BE Thoughtful Revolution – our free behavioral economics community, and keep the conversation going! Learn and Support The Brainy Business: Check out and get your copies of Melina’s Books.  Get the Books Mentioned on (or related to) this Episode: Outsmart Your Brain, by Dan Willingham Good Habits, Bad Habits, by Wendy Wood Tiny Habits, by BJ Fogg You Are Not So Smart, by David McRaney A More Beautiful Question, by Warren Berger Connect with Dan:  Dan’s Website Dan on Twitter Top Recommended Next Episode: An Overview of Memory Bias (ep 280) Already Heard That One? Try These:  How To Change, an interview Dr. Katy Milkman (ep 151) Overview of Personal Biases (ep 45) Dunning-Kruger Effect (ep 266) Habits (ep 21) Stressed and Overcommitted? Tips to Tackle Planning Fallacy, a behavioral economics foundations episode (ep 114) Framing (ep 16) Temptation Bundling (ep 136) Herding (ep 19) Time Discounting (ep 51) Good Habits, Bad Habits: An Interview with Wendy Wood (ep 127) Bikeshedding: Why The Simplest Tasks Can Keep You Stuck (A Behavioral Economics Foundations Episode) (ep 99) Other Important Links:  Brainy Bites - Melina’s LinkedIn Newsletter