Thinking, Fast and
Slow, Daniel Kahneman
The author states in this book that we have two systems of
thinking that are constantly active. There
are two systems of thought process. System
1 represents the fast thinker that jumps to conclusions and makes quick
decisions. System 2 represents the
process of slow thinking. This system is
the more powerful of the two, and is most often in charge. It requires focus and it allows ideas to be
constructed in a logical fashion. Kahneman
explains our thinking process, what we assume that we are thinking, and what we
are thinking subconsciously. By fully
understanding the two part system of thinking, we are able to develop
significant ways to improve our lives.
The most prevalent theme in Thinking, Fast and Slow is to identify the effort and energy
expended in thinking, and how that impacts our behavioral patterns. Kahneman states that more energy is exerted
in System 2 thinking as more effort is required to simultaneously maintain
several ideas or related tasks. The System
1 thinking process does not manage this; instead its strength lies in
discerning simple similarities and differences one issue at a time. System 2 thinking can create a set of tasks
that overrides System 1 responses, known as executive control. Additionally, Kahneman explores concepts of
the thought process that significantly affect our choices and decisions such as
intuition, loss aversion, prospect theory, and the halo effect. Experiments related to these concepts were
performed and the information gathered may help entrepreneurs plan and target
product and service development activities, and guide marketing efforts to the
public.
The book has directly connected with what I am learning in
ENT 3003 in a number of ways. I have noticed
that I actually experience both thinking processes mentioned in the book. I engage in System 1 thinking when taking the
extra credit quizzes for this class. By
having to answer five questions in three minutes from the lecture material,
only the fast aspect or System 1 can be used.
The time constraint on the quizzes motivates one to quickly select an
answer. There is simply not enough time
to allocate the energy and the time needed to methodically arrive at a
reasonable solution.
System 1 was prevalent while conducting the interview
exercises, because it is just not possible to stop in the middle of a recorded
interview to consider how to respond to comments being made, or to contemplate what
to ask next, or when to end the session.
Additionally, I have found that System 2 is crucial to the development of
the venture concept and with delving into personal reflections, where ideas are
carefully crafted and presented in ways that clearly convey concepts in a
comprehensive way.
One exercise that I would develop for class would be to test
the concept of the “anchoring effect” that is prevalent in marketing our
products and services. This is a
cognitive bias that makes one rely heavily on the first piece of information
received. The exercise to develop for
class would be to test the concept of the “anchoring effect” prevalent in
marketing our products and services.
This is a “cognitive bias” that makes one rely heavily on the first
piece of information received. Students
would be randomly assigned to read a flyer that contains 3 key pieces of
information. However, each student is
exposed to a unique placement of that information. Later, a survey can be conducted to determine
which piece of information captured their attention the most. By using a control group, we can compare the
variations of message placement.
The biggest “aha” moment in the book came in the section
about decision making where the average person makes over a hundred decisions per
day, and even more for those who do it for a living. It is astonishing to realize how frequently
decisions are made, regardless of their complexity. Entrepreneurs need to recognize this concept
and focus on taking advantage of it to become successful in all of their
missions.
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