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A doctor whom I met, was upset about dealing with a lot of people coming to clinic equipped with wikipedia and LLM generated knowledge. Years of education and practice puts a doctor in the zone of unconscious competence, but for an expert beginner with no formal education or practice it is just a fact in some context without reflecting what is in hand. The doctor’s intuition will be right and often arrived without conscious thought, asking them to explain in detail may prove counter effective, in some case make the doctor doubt their judgement and end up treating poorly.

Let us take a few other examples from other domain. If you have come across the Monty Hall problem, where a host in a game shows 3 doors to a contestant, behind 2 doors are goats and the remaining 1 door with a huge reward. Once a door has been chosen, the host will open a door which has a goat behind it and give the contestant an option to switch the door if they think they would have made the wrong choice. If we do not think deeply, we think the odds are always 1/3rd irrespective of switching or not. In reality the odds are 2/3 if you switch and that has even stumped degree holders in math.

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Another counter intuitive one is bank teller queue management. I read at this blog, which mentions that an average five hour waiting time to service a customer can be reduced to 3 minutes to just by adding one teller extra. That is 90x productivity jump by doubling cost yet a lot of decision makers won’t believe the expert who analyses the situation and recommends them the solution because it does not make sense for a non expert. The example is dramatic but can happen in real situations as well.

When I observe a lot of people with expertise, their unconscious competence helps them navigate with ease without even thinking about it. The moment you question their judgement, their instincts take a back seat and suddenly their competency goes down. I was at a restaurant, I requested a cook for fried eggs. The cook asked if I wanted both sides to be cooked, and I said “yes, but don’t break the yolk”. The cook left out a nervous laughter and when turning the eggs to the other side, the yolk broke. I disrupted the cook’s flow just by doubting their ability.

This happens frequently at work. Decision makers who are expert beginners often want to get into the details, what this does is, it interrupts the flow mode of expertise. Explaining the solutions and decision making process which would otherwise be unconscious nature, requires a good deal of effort and often leads to sub optimal solutions. If you have an expertise on some area and are tasked with solutions, then keep in mind that you have to explain your decisions to people who know details at a surface level. People are naturally curious and LLMs feed their curiosity a great deal.

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For this reason, whenever I come up with solutions, I make it a multi step approach. This is I learnt from many different sources which help you harvest your unconscious competence.

Step 1 – Read the problem statement, re-read and think very hard to solve the problem. Too often no solution emerges, but all of a sudden when you are at a break, a solution emerges and when it happens immediately write it down. Beware, this solution is ephemeral and its details vanishes within a few minutes. Keep noting down the solutions that pop up at odd times like driving, cleaning etc.

Step 2 – Find reference material from internet and previous assignments to back your solutions. If it is a novel solution, dive deeper to explain but do not change the solution because you can’t find explanations.

Step 3 – KYEB (Know Your Expert Beginners) and be equipped with ELI5 answers to anticipated questions to impart confidence of the solution.

Before presenting your solution, establish your credentials which helps setting the right expectation using info from the KYEB research. This helps to present your views as an expert without getting into a loop of explanations and doubts. For the doctor’s case I discussed at the beginning, I recently see a few doctors have a dossier to quickly explain their decisions and cut short the questioning from the patients. We also will be expert beginners at many topics, the best we can help there is to let the experts do their job.

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Stock markets are at high, keeps breaching previous highs every now and then. Economy should be doing well and life should become easy right. I was surprised to see that instead of life becoming good, experiences all around are either stagnant or deteriorating.

Some of the recent experiences I have reflect the new trend. I went to a speciality restaurant for a good dining experience. This was an upscale restaurant chain which gave fantastic dining experiences before for our family. When we went in, we noticed that the restaurant has split into two distinct cuisines (Chinese and Bengali) within the same space with just some seating demarcation. The special food is going to be cooked in the kitchen by the same set of cooks. The ambience had a worn down look with paints peeling and seats torn. When we received the menu, we immediately noticed that the prices have increased by 25-30% and the portion sizes have come down 25-30%. The waiter had no idea on what the menu is about, had no suggestions on how to go about a multi-course meal. In the end, the experience on dining big was just on the bill amount, nothing else. It would have been a better experience having the food from a cheap takeaway and eating it while watching TV at home.

Similar heart burning experiences everywhere. Cabs are not assigned to you during peak hours unless you pay a hefty premium for the same cab. Mobile apps are misusing the notifications feature to deliver ads. OTT subscriptions downgrading you in the middle of the subscription plan to serve more ads. Grocery delivery is sending bad quality produce for regular delivery and introducing a premium feature for fresh produce. The list goes on.

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The push from success to excess is evident even in non consumer space. I noticed a recent trend, many executives are asking for a template/runbook based execution so that they can do a lot with very little or no training to the people doing that job. In short they want jobs to be in black & white and easily doable by gig workers who can be onboarded and off-boarded at will just like food delivery. This kind of thinking harms in many ways, one – it starts to increase the need of people who are good at parroting not an original thinker, the other is infusion of a blandness and mediocrity in everything; check for thermometer in amazon for proof. It is not just limited to every day items, even cars start to look the same across brands.

Executives think that they are special and can bring in insane profits by making people do exactly what they say, which may be true in the short run. History says that the best advancements came from grounds up not from top down. The cognitive load that it causes on the executives who do not want their workforce to think because it hampers their execution is huge, it will cause a flameout, momentarily burning bright before failing. Resilience and collective wisdom is poorly understood because it has a very long learning horizon. Being resilient will even come across as inefficient in the short run, but will prevent uncle points.

The more from less mindset that happens through grabby nature instead of advancements and innovations is hard to curtail now, it may be a cycle in the economy. We may have to weather it out before it improves again.

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Based on our ability to foot the bills for standard of living we are often placed in socio-economic classes. The middle class is one long continuum before reaching affluent or HNI class. What I observed is, unforeseen events can push an individual and their families a notch or two below their current status more often than well planned savings and investments pushing individuals few notches above. Thereby it is easy to lose wealth than to gain and keep it safe, so extra care needs to be taken to preserve it. Someone who has an enviable lifestyle of a luxury apartment and a D segment car can lose it all within a month due to either a natural disaster or an accident which was never thought of.

These type of risks are tail risks, we are inherently optimistic and given the low probability of these high impact events we always think that such cases never happen. So we never have a mitigation plan in place. These risks when materialising will not just cause a setback, it ruins. Tail risks cumulatively increases, which means though as a single risk in single exposure looks negligible, multi risk, multi exposure over time will increase the likelihood of ruin very much.

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Consider the following risks taken together – You don’t wear a helmet while riding a motorcycle, you frequently ride in the night in accident prone highways, you don’t sleep well often, you don’t eat a balanced diet, your motorcycle is not maintained routinely. The combined risk of having a serious injury has a very high likelihood thereby leading to a ruin.

Some tail risks like lifestyle diseases can be avoided altogether with a healthy lifestyle, many others like a geopolitical instability can’t be mitigated but can only be prepared to sail through with diversification of holdings. Insurance is a good option against many unforeseen circumstances, though many people view insurance as a expense, it is a way of paying it forward and praying such a scenario never happens. Someone not paying for insurance will have some money left in hand but at the grave risk of losing it all.

Identifying the tail risks in our life and planning for a mitigation is very much necessary. Being poor is expensive, once we are knocked off the socio-economic position, it is very difficult to claw back on to the same position. Mitigations are not just insurance, it is healthy lifestyle, adherence to safety standards, avoiding risky behaviours, hedging, diversification etc.

I like Nasim Taleb’s work on this topic and much more on probabilities. We don’t realise the skin in the game in the long term as we are too short sighted as a common human.