“Show me the incentive and I will show you the outcome.” — Charlie Munger
good one sir
Nice and insightful article with full of anecdotal examples and illustrations.
Hope we all including this Govt learns a lesson out of this.
Thanks for this article. Few other examples I which I read on this topic are from Creative Whack pack & your old Blogspot 🙂
#1. Air Travel’s Unintended Consequences:
To help offset rising jet-fuel prices, American Airlines recently added a $15 per bag fee for passengers checking more than one bag on their flights.
So, how is this working out? How does human behavior factor in? Here’s one story.
Last night, I flew on an American flight from St. Louis back to San Francisco. The in-bound connecting flight from Miami was two hours late. Thus, all 152 passengers were ready and eager when it finally came to board the flight (the plane was a single-aisle 757).
It took 40 minutes to get all of the passengers on. Why so long? Since passengers didn’t want to check their luggage, they brought larger than usual bags on the flight. Since there’s only so much overhead storage space, it took passengers longer to rearrange the bags in the over-head space so they could get their bags to fit. And, of course, they did this while they were standing in the aisle so that no one could pass them.
Here’s the juicy unintended consequence: since we pulled out so late, the pilot came on and said, “We’ll try to speed things up for you, and fly a little faster to make up up some of the time we lost getting out of the gate.”
So, in effect, American’s new checked bag policy ended up costing them money in extra jet-fuel use. Wow!
#2. “Beware the Unintended”
Card # 42 (“Beware the Unintended”) states:
“In preparing for the Olympics, the coach of a leading new team invited a meditation instructor to teach awareness techniques to his crew. He hoped that such training would enhance their rowing effectiveness. As the crew learnt more about meditation, they became more synchronized, there was less resistance, and their strokes got smoother. The irony is that they went slower. It turned out that the crew became more interested in being in harmony than winning.”
[Connection with “effects have effects”]
Excellent read, truly mesmerizing as always
good one sir.. very insightful.. always two faces of coin.
Nice one sir.
Is there any book to learn about the 2nd/3rd order thinking!!
eye opener and we can add it as a check list before making vital decisions
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