Understanding human behavior, no matter how complex it may seem, can be valuable when launching a business or moving into a new aspect of your career. Luckily for you businessmen and women out there, Dan Ariely’s Predictably Irrational: The Hidden Forces That Shape Our Decisions is an excellent, and highly comprehensive guide toward understanding how not rational our decisions usually are.
Predictably Irrational, in the own words of Dan Ariely is meant to make the reader fundamentally rethink what makes them and the people around them tick. To do this, Ariely presents scientific experiments as well as several amusing anecdotes. But why should you trust what Ariely has to say about the way we make decisions? Dan Ariely happens to be the world’s leading behavioral economist and teaches psychology, as well as behavioral economics, at Duke University. Ariely is also the founder of The Center for Advanced Hindsight at Duke University, where he leads research on topics ranging from how we spend money, why people cheat to social justice.
This book is valuable for someone launching a company or starting a new career because it makes them think and reconsider if the decisions they are making truly are as rational as they think. What you will find is that they likely aren’t. For a long time, economist have painted this image of a human making the most rational and self interested decisions, but this book begins to unmask that in ways that can be beneficial to a CEO.
If, as a business leader, you first learn how your decisions are not as rational as you think they are and, at the same time, learn how your customers make decisions, you will be able to adapt and shape your business in such ways that you can take advantage of how customers think and make decision. This could potentially lead toward your business being able to better anticipate the needs of your customers.
Aside from the various experiments Ariely runs on his own students, he also presents examples on how we decide to support a business. Why do we choose to pay a few extra dollars for a cup of coffee even though the coffee across the street is cheaper and likely just as good? Companies like Starbucks Coffee, for example, have been successful in the way they have changed how customers looking for coffee think about price and the product. Ultimately, as a business leader, your goal will most likely be to change the way your potential customers think about your business in relation to the competition.