How to see through the essence from the complicated world?
Editor’s note: This article is from WeChat public account “Ai Philip’s ideal” (ID: xiaoyaolsh), author Effie’s ideal.
Charlie Munger said: “The mind model will give you a perspective or frame of thinking that will determine your perspective on things and the world. Top thinking models can increase your chances of success and help you avoid Failed.”
Indeed, the thinking model is a good thing that can help us explain, solve, and predict problems.
However, what is it? What can be called a thinking model?
I believe this is a question that most people can’t answer.
This article is coming to tell you what is a thinking model? And what is behind the thinking model.
Excellent people learning thinking model
Before answering “What is a thinking model,” let’s first look at what is a model?
1, what is a model?
In fact, Charlie Munger has defined a “model” – any artificial framework that can help you better understand the real world is a model.
For example: American Airlines receives millions of passengers a year and creates hundreds of billions of dollars in value. But in 2012, aircraft fares averaged $178, and each flight airline earned only 37 cents per passenger.
And Google, the value created is relatively small, but it makes a lot of money.
Google only created $50 billion in value in 2012 (the airline created $160 billion), but it made a 21% profit. This profit margin is more than 100 times that of the aviation industry.
Google’s huge profits make it more than three times the market value of all American airlines.
Why is this happening?
This seemingly complex phenomenon, economists gave explanations using only two simple models: one is perfect competition and the other is monopoly.
Complete competition, saying that there is no difference between each company in this market, selling homogenous products. Because these companies have no market power, the price of their products must be determined by the market.
In contrast, monopoly says that monopolistic companies have their own markets, so they can price themselves. Because there is no competition, the monopoly company is free to decide the supply.Quantity and price to maximize benefits.
The market in which airlines are located is a completely competitive market, and Google’s market is a monopoly market. Because of this, the profit margins of the two are far apart.
This is the way to use the “model”, which is what Charlie Munger calls “artificial framework”, to simplify and abstract things that seem complicated.
What is the thinking model?
Simply, the thinking model is the compression of information, the best framework to help people understand things and solve problems.
It can be said that the thinking model is the toolbox in our brains for making decisions and thinking about problems, and sometimes it can be expressed as a framework for analysis. For example: SWOT analysis (S=strengths advantage, W=weaknesses disadvantage, O=opportunities opportunity, T=threats threat); sometimes it can be expressed as a short theory, such as: psychological account theory.
And if you use a stylish metaphor: the thinking model is the APP installed in our minds.
When we want to determine the itinerary for the holiday, we turn on the phone and click on the “Ma Honeycomb” app above to see how others are playing. When we wanted to book a hotel, we opened the phone and clicked on the “Booking” app above to complete the hotel booking in an instant.
Similarly, when setting a work goal, we can open a name called “SMART” (S=Specific specific, M=Measurable measurable, A=Attainable achievable, R=Relevant related, T =Time-bound has a time-limited thinking model that is used to set clear and detailed executable targets.
APPs on mobile phones are toolboxes that can be used directly, and once the mind model is rooted in our minds, it becomes a toolbox that can be used directly.
Therefore, the more toolboxes (ie, thinking models) you have in your mind, the more effective apps you install, the more quickly you can make quick and correct decisions and choices.
2, how to use the thinking model?
For the importance of the thinking model, Charlie Munger once said: “To get universal wisdom? 80-90 important models can do 90% of work .”
So, the most basic first step in the use of thinking models is to understand the most important thinking models, and then apply them to everyday work and life, using them to explain, solve, and predict problems. .
For example, you find that some people are not soft on eating and eating clothes, but they rarely spend on investment in learning and self-growth.
If you know the mental model of “psychological account”, you will immediately understand that it means that we will put money in different mental accounts. Because money is not stored in our hearts.
For example: the necessary expenses account for life, the purchase of clothing and shoes bags, children’s education accounts, and leisure leisure accounts.
Although these accounts seem to be under your big account, each sub-account is independent.
So, for me, I put most of my annual expenses in the psychological account of “self-growth and learning”, and then put a small part in the psychological account of “buy clothes, shoes and bags”. .
In contrast, some people put most of their income in a mental account called “luxury consumption,” and the amount of money allocated to the “self-growth and learning” mental account is very small. Therefore, according to his psychological account allocation, he will habitually spend money on the purchase of luxury goods.
You find that although many companies want to make an instant messaging tool that can subvert WeChat, none of them has been able to shake WeChat. On the contrary, WeChat has become bigger and bigger, and now the monthly life has reached 1 billion.
The reason behind this hidden is the thinking model of “network effect.”
The thinking model of network effects says that users cannot leave the network because they cannot do without other elements on the network.
For example, WeChat has become more and more popular, because each of us has family, colleagues, and friends. So we can’t help but use it.
Visible, after understanding what a thinking model is, we will find that concepts, theories, or methodologies in many disciplines can be called “thinking models.”
Once you master these “thinking models”, you have installed a lot of very useful apps in your mind, which you can use at any time without worrying about or even inventing.
So, the learning and use of thinking models can help us interpret, solve, and predict problems better, faster, and more thoroughly.
So I said that good people learn thinking model.
But why do I still say that “the top outstanding people think about the underlying logic?