How to Be Present to Every Moment

Imagine the following situation. You are single and live in New Jersey just outside of New York City (NYC). Your employer wants you to work in London for a few years. You are excited about the possibility of living overseas and are interested in the job. Assuming that the costs of living for New Jersey and London are roughly equivalent, which option would you choose?

1. Temporary Option: You stay an employee of the NYC office and are “on loan” to London. You continue to pay your mortgage/rent in New Jersey, but can rent/sublet your place to someone during your absence. The company pays all of your expenses in London: housing, food, and travel to and from the US. They cover the difference in taxes between the US and UK. Basically you have no expenses for the three years you are there and you can sock away 100% of your salary. Your stay is temporary. After your time overseas, you will return to the US.

2. Permanent Option: You transfer from the NYC office and become an employee of the London office. You are paid in British pounds just like all other British employees and you pay UK taxes which are higher. Although you sell your house in New Jersey and have no expenses in the US, you need to cover all of your expenses in London. There is no guarantee of a job in the NYC office should you decide to return to the states.

Financially, option #1 is a SIGNIFICANTLY better deal.

But when faced with this situation in real life, I chose option #2.

Why?

Three years is a long time. I wanted London to feel like home. I wanted to live like a native. I wanted to know that there was no return to the US. It forced me to be present to what I was doing and to take full advantage of England. I formed new social circles. I dated. I lived as though I would be there forever. London became my home. A little more than three years later, I was back in the US, without a job.

Although from a financial perspective, it may not have been a great decision, it was the right decision. I had the most spectacular three years of my life. Had I chosen option #1, I may never have felt settled. I always would have known that I was leaving. It would have been a missed opportunity.

How often do you live with uncertainty? How much of that uncertainty is created by you in your mind? How much does this uncertainty ruin your present moment experiences?

Have you ever been in a great relationship…yet continually worried about it ending? Maybe you were concerned that your partner didn’t love you as much as you loved them. Or perhaps you thought that your relationship was just too good to be true. Although you have great times together, these concerns permeate your mind. Doesn’t the uncertainty about the future affect your pleasure now? Doesn’t it also this increase the likelihood that your greatest fears will materialize and your partner will leave? Let’s face it, most relationships eventually end. You leave your partner, your partner leaves you, or your partner dies. But if you live with the anticipation of that ending, you will never enjoy the present.

Have you ever been in a job that you didn’t like? Did you daydream continuously about leaving…yet three years later you are still in the same job? Instead of dreaming about the future, be present to what you can do today in your job. Look for new opportunities internally. Do the best job you can. Find ways of adding more value. If you are focused on leaving, you will be miserable. And the odds are, you will lose your job because of poor performance. That’s when you will begin to daydream about how great your job used to be.

Being present, without worrying about the future, is not easy. Could I have chosen option #1 and treated London like my home? Quite possibly. However, for me it was better to take what seemed like a permanent option, even though it was just as temporary.

What if everything is temporary? But what if the option we choose – temporary versus permanent – is the one thing that determines our happiness?

Where in life are you living the “temporary option,” where you think/hope/fear that your current situation will end? Where is this not serving you well? How can you choose the “permanent option” so that you are living fully in each moment?

This may be THE key to happiness.

How One Word Can Change Your Beliefs

Once again we explore the power of language. This one was given to me by Michael Wiederman, Professor of Psychology at Columbia College.

Imagine that you serve on the jury of an only-child custody case following a relatively messy divorce. The facts of the case are complicated by ambiguous economic, social, and emotional considerations. Therefore you need to base your decision entirely on the following few observations:

Parent A has an average income, average health, average working hours, a reasonable rapport with the child, and a relatively stable social life. This parent is essentially average in every way.

Parent B has an above-average income, minor health problems, lots of work-related travel, a very close relationship with the child, and an extremely active social life. This parent has both notable strengths and notable weaknesses.

Here’s the interesting part…

If the jury is asked who should get custody, most people choose Parent B.

If the jury asked who should not get custody, most people choose Parent B.

Adding one word changed people’s responses and beliefs.

When asked who should get custody, people look for the positive attributes and see that Parent B has more positive attributes than the blander Parent A.

Conversely, when asked who should not get custody, people look for the negative attributes and see that Parent B has more negative attributes. Therefore Parent A should be awarded custody.

This is an example of the psychological concept, confirmation bias.

This is important to keep in mind as we get closer to the Presidential elections. Political polls, such as the Gallop Poll, are often biased (unintentionally or other) by the wording of the surveys. Think critically before you make important decisions.

10½ Ways to Improve Your Life – By Losing

In two previous blog entries, (#1 and #2), I discussed the psychology behind risk taking. In particular, I explored why people take risks to minimize losses, yet play it safe when it comes to increasing gains.

In this blog entry, I discuss a number of implications of this mindset. Here are 10½ – potentially irrational – ways in which people do everything in their power to minimize losses, even though the gains that can come from risking the loss can be amazing.

1. CREATIVITY: According to studies, 98% of children age 5 are highly creative, yet only 2% of adults over the age of 25 are. Why? One reason is that children do not worry about looking silly. Adults do. Adults will stifle a potentially great idea in order to avoid losing face. Action: Add some play to your life and work. Stop being so serious. Take improv comedy lessons. This will certainly get you comfortable with looking silly!

2. INNOVATION: Companies continue old business practices, processes, and products because the perceived risk of losing these is too great. Action: Keeping a business or product because of sunk costs is stupid. Ditch anything (including people) that is not working. Ask yourself, “If I were starting my business from scratch, how would I design it?” If it is different than your current model, then maybe you should get rid of a few things. What you stop doing is often more important than what you start doing.

3. INVESTING: Stock owners often hold on to investments that they would not buy if they did not already own them. Or worse, if they own a stock that is tanking, they buy more on the belief that “because I own it, it will recover.” I did this with Webvan stock. I kept buying more stock as the share price plummeted, convinced it would bounce back. Alas, you can’t buy anymore when it is worth nothing. Action: Sell anything in your portfolio that you would not buy if you did not own it. Low transaction costs make holding on to duds irrational (unless tax implications indicate otherwise).

4. CAREER: People often stay in unsatisfying careers because the “devil you know is better than the devil you don’t.” I know what you are thinking. “Why should I give up my crappy job that gives my ulcers and high blood pressure? I worked my entire life to get where I am.” Um, I don’t know. Maybe because there are at least 1,000 better careers for you. Action: If you don’t love your job, quit. Ok, not so fast. But imagine leaving your job. Explore what is possible. When you discover something better, list all of the reasons why you are still not prepared to leave your current situation. Then find ways of addressing each of these concerns.

5. CUSTOMERS: Are all of your customers profitable? Are all of them desirable? The odds are, you have many customers or customer segments that are just not worth the effort. Ironically, companies often spend an inordinate amount of time with customers that provide the least returns. Action: Ditch the least profitable 20% of your customers. Or at least find creative ways to make them more profitable – and less time consuming.

6. DATING: People will do anything to avoid losing face. The fear of rejection stops people from asking others out on a date, even though if they said “yes” it could lead to a new relationship. Action: Stop being a wimp! Rejection never killed anyone. Ask out that person you’ve had your eye on. Go up to a stranger in a bar and say, “I’m thinking of changing my name to Romero. What do you think?” (if you don’t know the Romero story, click here)

7. RELATIONSHIPS: Imagine that you are in a relationship that is going nowhere fast. Your gut tells you it should end, but for some reason you do everything in your power to keep the relationship alive. Action: First, do what you can to bring the relationship up to the standards you deserve. If that does not work, find an equitable way of ending things and moving on. Do you really want to wake up 25 years from now in the same wretched relationship?

8. BELONGINGS: Go through your closets. Look in your bookcases. How much “stuff” do you have that you really need? How much of it would you buy if you did not own it? 20%? 30? Certainly not more than 50%. I often hear people say, “as soon as I throw something out or give it away, that’s when all of a sudden I find a need for it.” Although this phenomenon is not true, it seems real. As a result we hold on to things “in case” we need them, rather than “because” we need them. Action: Go through everything you own. If you haven’t used it in a year, put it in a box. If after a year you haven’t opened the box, give away (or sell) the entire box.

9. HEALTH: People will spend a lot of money on health insurance – a way of reducing losses associated with an illness. But they won’t put much time or energy into increasing their health. Action: For every dollar you spend on health insurance (loss prevention), spend at least 10 cents on things to improve your health. Get a gym membership. Buy vitamins. Get a massage. Take a stress relieving vacation.

10. REQUESTS: People are often afraid to ask for help because they don’t want to seem needy (lose face), or impose upon and risk losing their friends. Action: Identify 10 requests you could make of 10 different people (e.g., a connection with a person who may be able to help your business, feedback on a new business idea, financial support, moving your house). Then, ask these people for help. You may be surprised to find that few people say “no” and that most people are willing – and want – help you.

10½. Why do I blog on a regular basis? One motivator is to avoid losing readers. I currently get 50,000 visitors here a month. I intentionally write for a mass-market to attract as many diverse readers as possible. I have considered writing only for a niche market (e.g., corporate innovation), but I know in doing so I would lose a lot of readers. I realize that having fewer, yet more active readers may actually be a good thing. Alas, for now, I like appealing to a large audience.

Where in your life have you given up something only to find a huge gain? Where have you held onto something knowing it was holding you back?

How to Leverage the Pain vs. Gain Mentality

In an earlier blog entry, I discuss the power of language. I want to explore this a bit further today.

Here’s my variation of the “Asian disease problem” mentioned in that earlier blog entry:

Which would you prefer?

• OPTION 1: A guaranteed gain of $75,000?
• OPTION 2: An 80% chance of gaining $100,000 with a 20% chance of getting nothing?

When I give a speech and ask the audience this question, 75% choose Option 1. This percentage is consistent across all groups, regardless of who is in the audience.

Ok, what about the following? Which would you choose?

• Option 3: A certain loss of $75,000?
• Option 4: An 80% chance of losing $100,000 with a 20% chance of not losing anything?

When audiences answer this one, 99% choose option 4.

This once again supports the premise that people will take risks to reduce losses, yet will be more risk averse when it comes to increasing gains.

Interestingly, when you look at these options, even though most people choose options 1 and 4, options 2 and 3 give you better returns. On average, you will gain $80,000 with option 2 and will lose $80,000 with option 4.

Look around and you may begin to see examples of advertisers focusing on losses rather than gains, with stellar results. For example…

How many mattress commercials have you heard that say, “Buy our xyz bed and you will get your best night’s sleep ever.” Yawn. Boring. The commercial may put me to sleep, but it’s not going to get me to buy a bed.

Consider this actual advertisement. “If your mattress is 10 years old, it weighs twice its original weight due to the dust mites that accumulate over the years.” Ouch! This makes me want to replace my mattress now.

Instead of selling customers on how great your product or service is, show them the downside of using a less reliable alternative. As a friend of mine says, “If you need open heart surgery, would you shop for a cardiologist based on price?” She then launches into the risk associated with not getting it (your product/service) right.

What examples have you seen of great sales pitches, advertisements, or anything else that uses this concept?

P.S. One place where this concept apparently does not apply is on TV game shows. I see people on “Deal or No Deal” risk a certain $500,000 for a 50% chance of winning $1 million. Their interviewing process must do a great job at finding the few people who really do take risks to increase their gains.

How to Change Your Results by Changing Your Language

Which magazine do you think men are more likely to buy:

• a men’s health magazine with the cover, “Lose Your Gut Fast” or
• a similar magazine with the cover, “Get Six Pack Abs”?

One study showed that over 80% of men chose the first cover – “Lose Your Gut Fast.” Why?

People are more interested in avoiding (or reducing) pain than they are in increasing pleasure.

The Austrian economist, Ludwig von Mises, once said that three requirements must be present for an individual to change:

1. The individual must be dissatisfied with the current state of affairs.
2. They must see a better state.
3. They must believe that they can reach that better state.

That last point is critical as it relates to the “gut” issue. When someone is 20 pounds overweight, as many Americans are, six pack abs may be desirable but seem inconceivable. I sometimes joke that I would be happy with a “two-pack.” Only when your gut is gone will the idea of six pack abs seem like a possibility.

Tversky and Kahneman demonstrated how people change their perceptions when the same problem is stated in different ways. The classic example is the “Asian disease” problem (1981) where a group of individuals were asked the following question:

Imagine that the US is preparing for the outbreak of an unusual Asian disease, which is expected to kill 600 people. Two alternative programs to combat the disease have been proposed.

• Program A, which will save 200 people
• Program B, where there is 1/3 probability that 600 people will be saved, and 2/3 probability that no one will be saved

Which of the two programs would you choose?

Tversky and Kahneman found that 72% of those asked chose the “risk averse” position – Program A. The prospect of saving 200 lives with certainty was more promising than the probability of a one-in-three chance of saving 600 lives.

A second group of respondents were given the same story of the Asian disease problem, but were provided with different options.

• Program C, where 400 people will die.
• Program D, where there is 1/3 probability that nobody will die, and 2/3 probability that all 600 people will die.

Which of the two programs would you choose?

A whopping 78% of respondents in the second problem chose the “risk taking” position – Program D. The certain death of 400 people is less acceptable than the two-in-three chance that 600 people will die.

Of course, options A and options C are identical, as are options B and options D. Yet the different phrasing stimulated completely different responses.

This study again shows that people will take greater risks to minimize (or reduce) their pain, yet they will play it safe when the option is to increase their pleasure.

Barry Schwartz provides some other excellent examples in his Scientific American Mind magazine article (August/September). One example he sites: “Appeals to women to do breast self-exams that emphasize the benefits of early cancer detection (gains) are less effective than those that emphasize the costs of late detection (losses).”

In my article, “How to Tell If Your Intuition Is Good,” I discuss how we get attached to what we have. When taking a test, we remember (painfully) situations where we had an answer correct, changed it, and therefore got it wrong. Surprisingly, we rarely notice the reverse. We are more aware of our losses than our gains.

Many years back I did work for a client. Although I would have been happy to do it for $9,000 (not actual figures) they agreed to pay me $10,000 for my efforts. Unfortunately, due to shoddy work by a subcontractor, I volunteered to refund $1,000 (out of my own pocket) to the client, netting me $9,000. Interestingly, I would have been happy getting paid $9,000 for the job, yet getting $10,000 and losing $1,000 still irks me to this day.

The loss of $1,000 hurts worse than a gain of $1,000 feels good.

When you are trying to get someone to change (or buy your product/service/ideas), do you focus on their gained pleasure or eliminated pain? From my experience, the latter is much more effective.

What are your examples of where you changed your language and got different results?

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