Articles Posted in Thinking

Ian Ayres, Super-Crunchers: Why Thinking-By-Numbers is the New Way to be Smart (Bantam 2007) at 112, explains that “The human mind tends to suffer from a number of well-documented cognitive failings and biases that distort our ability to predict accurately.” Ayres gives three examples, each of which crops up in-house.

We tend to weight unusual events that seem salient too heavily. The unusual decision, the famous partner, the dramatic mistake all might unduly influence a lawyer. “Remember that one closing where we didn’t have six copies!”

Second, we have a tendency to discount disconfirming evidence and focus instead on whatever supports our pre-existing beliefs. A lawyer doesn’t read about processes that don’t fit within the lawyer’s framework. “Offshoring? It won’t ever make it!”

To upgrade the mental capabilities of in-house counsel, encourage them to sweat. A fast-beating heart is a high RPM brain. Exercise “improves the blood’s access to specific brain regions and stimulates learning cells to make brain-derived neurotrophic factor, or BDNF, which acts like cerebral Miracle-Gro for neurons.” Personally, I sprinkle BDNF liberally on my granola each morning. More about the link between physical and mental fitness comes from the Harv. Bus. Rev., Vol. 86, at 22-23.

Not to sweat the details, but “You learn 20% faster immediately after exercise than after sitting still.” Among the ideas in the article are to have treadmills installed in offices and to encourage employees to take breaks and use them. As a side benefit exercise reduces both stress (See my post of April 16, 2007: benefits of a corporate health center.) and waist size.

Workouts and work fit together nicely. Now it smartly dawns on me why I read on my daily stint on the Stairmaster. For lawyers, let’s dub it the LAWcker room effect.

Some research suggests that our bias toward higher-priced goods may have something to do with the way our brains link price with pleasure — and thus leads people to make assumptions about expensiveness signaling quality. If it’s pricey it must be premium.

A column in the NY Times, Feb. 9, 2008 at C6, reports a study of volunteers who tasted and evaluated five wine samples. The same wines were described sometimes as moderate cost and sometimes as expensive. “[B]rain scans taken as the volunteers sipped and rated the wines showed that the higher-priced wines generated more activity in the medial orbitalfrontal cortex, an area of the brain that responses to certain pleasurable experiences.” The price tag bias may show up with law firms. Big bills may trigger assumptions of high quality. But we still wine about costs.

You would have a hard time deciding among all the posts on this blog about decisions. A number of them step back from specific tools and techniques to broader aspects of in-house decision-making (See my posts of Aug. 24, 2006: multiple facets of in-house decisions; March 6, 2006: six generic forms of decision-making; Sept. 10, 2005: mental models; July 27, 2007: decision empowerment; June 6, 2006: mental maps and frameworks; Nov. 11, 2007: contexts for understanding decision-making; Aug. 20, 2006: neuro-economics; Jan. 25, 2008: reality of cause and effect; Jan. 16, 2008: cognitive lawyering and four references cited; April 19, 2006: depersonalized decisions; Oct. 19, 2005: aside from results, improve processes and match to results; and Feb. 10, 2007: four main strategic decisions a general counsel can take.).

Many tools are available to help lawyers come to conclusions (See my posts of Jan. 17, 2006 on decision analysis tools; June 18, 2007, Jan. 17, 2006 and Oct. 24, 2005: belief nets and decision trees; Nov. 28, 2005: mind mapping software; Feb. 23, 2006: argument diagrams; May 10, 2006: influence diagrams; Aug. 28, 2006: paired comparison analysis; Aug. 30, 2006: grid analysis of options and factors; Sept. 29, 2006: augmented-cognition software; April 17, 2006: decision tools; Nov. 6, 2006: “after action” reviews; and Oct. 15, 2007: pre-mortems.).

Techniques help lawyers make better decisions (See my posts of Sept. 4, 2006: alternatives, surrogate arguers, and goals; Dec. 22, 2005: “reference classes”; Feb. 20, 2007: sleep on it to make a good decision; Feb. 18, 2006: three thoughts on how to make better decisions; May 10, 2006: framing the problem; and Dec. 3, 2007: emotional intelligence and decisions.).

It is fascinating to mull over what causes what. A few comments on this blog have adverted to cause and effect (See my posts of Nov. 11, 2007 on four contexts that vary by cause and effect; May 14, 2005 on “proof by anecdote”; and Jan. 1, 2008 on agency theory.). Many times I write in terms of a fact situation “causing” another situation, such as legal complexity being partly determined by the regulatory burdens on an industry (See my post of Dec. 14, 2005.). Three other observations are in order.

One point to ponder is which event is cause and which event is effect? Did a lower attrition rate result from an improved evaluation process or the other way around? Several of my postings have explicitly questioned a cause-and-effect direction (See my posts of Dec. 21, 2005 about emotional intelligence and success; Jan. 27, 2006 on in-house counsel and revenue per employee; Sept. 10, 2005 on law firm size and prominence in league tables; July 2, 2007 on market capitalization and the number of lawyers in a company; and Jan. 27, 2006 on business managers in law departments and lower total costs.).

A second point concerns the degree to which something causes something else. Historian use the term “over-determined” for the notion that an event has many antecedents and that it is very hard to disentangle which of them had priority (See my post of Nov. 24, 2007 on factors that put pressure on in-house counsel.). It is impossible to say, “Budgets accounted for 29% of our savings last year.” A magazine used the colorful phrase, “the hogswallow of multiple causation.”

For years, psychologists have studied and confirmed the familiar phenomenon of so-called psychological reactance. An article in Cal. Mgt. Rev., Vol. 50, Fall 2007 at 164, about gender stereotypes in negotiation defines that phenomenon as “the heightened desire people feel to assert their freedom when they perceive it is being restricted by others.”

None of us likes to be forced to do something. For example, if lawyers within a corporate legal department are told to track their time every Friday, whether conscious of it or not many of them may respond to the attempted influence of the general counsel by asserting their freedom to delay putting in their time entries. Managers inevitably direct people, so psychological reactance occurs all the time (See my post of Jan. 17, 2006 on passive-aggressive behavior.).

An article in Cal. Mgt. Rev., Vol. 50, Fall 2007 at 146, does a good job of explaining prediction markets, which in part are a way to aggregate information (See my posts of Feb. 16, 2006 on collective prediction markets; Sept. 13, 2005 on an early version of this; Dec. 20, 2005 about an online futures market for litigation; and March 17, 2006 on internal “markets.”). The article describes three shortcomings of another way to aggregate information, meetings, in terms of the problem of accurate information aggregation.

“First, members in the meeting may not have incentives to provide unbiased information. Worse yet, they often have incentives to provide biased input. Second, members often yield to theirs superiors because of a hierarchical power structure. Third, there is no systematic way to assign relative importance to each input. As a result, whoever argues most eloquently usually has his or her input weighted significantly more. However, a person’s ability to communicate may not have any direct bearing on whether they have relevant information.”

I should add that some people are stubborn so they eventually grind down the others at a meeting. These imperfections of meetings have come to light on this blog (See my posts of June 5, 2007 on politics; Feb.1, 2006 on the chilling effect of seniority; and March 12, 2006 on electronic voting software that permits anonymous opinions.).

We are all very susceptible to the actions of our peers when it comes to making a decision. This idea comes from Sloan Mgt. Rev., Vol. 49, Winter 2008 at 84, where an article gives many examples of the powerful influence on us of our colleagues’ actions. Actually, the point of the article is stronger. Peer influence, though powerful, is usually denied by most people. We favor ourselves as more independent-minded than we are.

Lawyers in-house watch what their fellow lawyers do and often follow suit. They may deny that they are trailing along, that they are followers, as the research shows, but several ingenious experiments suggest that peer influence is without peer.

My initial forays were in 2006 (See my post of Feb. 15, 2006 with 15 references in nine categories; and May 30, 2006 and three references cited.). Since then many more posts have set out ideas about how our brains operate and the consequences for lawyers.

A few blog posts have delved into the methods by which researchers have come to understand more about how we think (See my post of Aug. 19, 2007 #2 on TMS.).

Most of the posts have to do with how lawyers think (See my posts of July 10, 2007 on our penchant for generalities and conclusory statements; April 17, 2006 on our proclivity to confirm what we believe; Nov. 22, 2007 about sad moods as conducive to thinking; Dec. 5, 2007 on metabolic differences in cognition and behavior; June 27, 2007 #3 on fat and fast thinking; April 27, 2006 on CLE and brain longevity; and June 7, 2006 on attention density.).

An author in Historically Speaking, Vol. 8, May/June 2007 at 15, wrestling with notions of complexity in history (See my post of Jan. 1, 2007 for a related comment.), offers the metaphor of maps. “Just as mapping can be carried out at many scales from the local to the global, so historical encounters … may be mapped at every scale from the micro to the macro.”

Analogously, those who write about law departments, those from a different perspective who prepare “maps” of that conceptual terrain, can treat the subject from the most mundane to the most magnificent. The scale can be inches to an idea for a treatment that is miles and miles wide. Each level fits into the overall picture and no view is more privileged than another. Each perspective and intellectual grid coordinate should be fit for a certain purpose. “At every cartographic scale something is lost even as something is gained” (See my post of Aug. 10, 2007on tiny topics.).