Product vs. Packaging / Action Bias Mental Model (Incl Precision vs Accuracy, Busyness vs. Productivity)

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Product vs. Packaging Mental Model (Incl Action Bias, Busyness vs. Productivity): Executive Summary

If you only have three minutes, this introductory section will get you up to speed on the product vs. packaging / action bias mental model.

The concept in one quote:

It was as if we were running a race but no longer knew what we were running for. - Howard Schultz, ex-Starbucks CEO Click To Tweet

(from “ Onward” – O review + notes)

The concept in two sentences: if an omniscient “econ” bought something, the packaging would be a “supposedly irrelevant factor” – it’ll be thrown in the trash; only the product will be used/enjoyed/eaten.  

However, humans with limited cognitive resources use the packaging as a “signal” of the quality of the product, a cognitive tendency which – like most – is generally adaptive but can occasionally lead to strange and illogical behavior – like working very hard in a manner that’s completely unproductive, or even counterproductive.

Key takeaways/applications: probabilistic thinking and base rates both suggest that we *should* start any analysis by paying attention to the packaging, but we need to take our analysis further to make sure that the product matches the packaging.

Three brief examples of the product vs. packaging / action bias mental model:

Icing the kicker… or the sucking chest wound.  Does icing the kicker – i.e., coaches calling timeouts before opposing teams attempt critical late-game field goals – actually work?  

The evidence is mixed at best. Shawn Achor argues in “ Before Happiness” ( BH review + notes) that it doesn’t work; other analyses you can find online suggest, at most, a marginal benefit (that likely isn’t statistically significant.)

So why do NFL coaches routinely do it?  Action bias – for various reasons, including our need for agency, we’d rather do something than nothing.

Indeed, a similar phenomenon crops up among doctors – partially due to incentives; Sunstein/Thaler wryly note in “ Nudge ( Ndge review + notes) that there are few doctors who specialize in “watchful waiting” – but even well meaning doctors can succumb to action bias when what they actually need to do is stop and think.

There’s a wonderful quote on this from Dr. Jerome Groopman’s “ How Doctors Think ( HDT review + notes):

Don’t just do something... stand there! - Dr. Linda Lewis Click To Tweet

We don’t take kindly to YOUR type around here.  Our affinity for an idea is often shaped strongly by its origin, or its messenger.  Dan Harris notes in “ 10% Happier ( 10H review + notes) that meditation – despite its scientifically proven benefits as an entirely secular practice – has a “massive PR problem” thanks to its association with hippies and eastern Zen-paradox nonsense.

Similarly, Tavris/Aronson note in “ Mistakes were Made (but not by me) – MwM review + notes – that if you tell people that an entirely reasonable policy was created by the opposite political party, you might as well have told them that Osama bin Laden wrote it.

David Oshinsky explores in “ Bellevue ( BV review + notes) how many American doctors resisted Germ Theory science because it came from Europe.

It shows up in every field: Gregory Zuckerman explains on pages 88 – 89 of “ The Frackers ( Frk review + notes) how engineers view geologists:

“Engineers don’t have much patience for geologists… they’re even more unlikely to listen when they’ve been working on an area for a while and a newcomer comes in to tell them how badly they’ve been botching it.”

Darwin would’ve been fired in, like, five minutes.  Books like Alex Soojung-Kim Pang’s “ Rest ( Rest review + notes – please see the review for a BIG caveat) and Cal Newport’s “ Deep Work (DpWk) – which we’ll explore – observe that managers often take comfort in the “optics” of productive-looking employees with their butts in chairs from nine to five.

But this is far from the approach taken by luminaries in many fields: Richard Rhodes’ “ The Making of the Atomic Bomb ( TMAB review + notes) explores how many of the critical aspects of nuclear physics were conceptualized not in the lab, but rather in a warm bathtub or on a cool path in a shady forest.  

In finance, John Templeton reputedly worked merely a few hours a day during a period when his fund had some of its best performance ever.

Even if we don’t have managers, we can often fall into the path of glorifying effort for the sake of effort – a line of thought which many source back to Calvinism, although it continues today with equally nonsensical secular paradigms like “ grit” (see the willpower mental model).

If this sounds interesting/applicable in your life, keep reading for unexpected applications and a deeper understanding of how this interacts with other mental models in the latticework.

However, if this doesn’t sound like something you need to learn right now, no worries!  There’s plenty of other content on Poor Ash’s Almanack that might suit your needs. Instead, consider checking out our learning journeys, our discussion of the inversion, sleep, or structural problem solving models, or our reviews of great books like  To Engineer is Human” ( TEIH review + notes), “ Deadly Choices” ( VAX review + notes), or “The Most Important Thing (Illuminated)” (MIT review + notes).

Product vs. Packaging Mental Model: A Deeper Look

“So are we just supposed to let everyone stand around out there?” asks Bob.

“Why not?” asks Stacey.  “Once somebody is already on the payroll, it doesn’t cost us any more to have him be idle.”

[Elsewhere]: “Productivity is meaningless unless you know what your goal is,” says Jonah.

– from Eli Goldratt’s classic business novel “ The Goal” ( Goal review + notes)

Product vs. packaging is an incredibly important mental model to spend some time thinking about because while it’s obvious on an intellectual level, it’s profoundly unintuitive on an emotional /intuition level (see cognition vs. intuition).

For example, in “ The Goal – referenced above – not only is it not bad to let employees stand around idle, but it’s actually good.  Overproduction in certain areas of the plant were leading to massive problems with inventory, throughput, and other issues.

While it’s a fictional story, the lesson is true enough: sometimes, doing something is worse than doing nothing.

Indeed, to dive a bit deeper on action bias: the aforementioned Laurence Gonzales, in his books Deep Survival ( DpSv review + notes) as well as his follow-up Surviving Survival, (SvSv review + notes) highlights the importance of “active waiting” as an option. 

Gonzales points out that in many survival situations, “Rambo” types are the first to die – expending limited energy is just going to get you exhausted, and probably dead. 

For example, one canyoneer whose arm was trapped by a massive boulder smartly overrode his natural inclination to keep pushing against the rock – it wasn’t going anywhere, and he needed to save his energy to figure out another path to escape.

In a completely different context, historian John Lewis Gaddis – in his concise, 300-page masterpiece On Grand Strategy (OGS review + notes) – repeatedly observes the importance of time as a dimension along which strategies can succeed or fail.

Citing examples ranging from Elizabeth’s upset conquest of the Spanish Armada with a ragtag Navy, to Lincoln’s careful stepwise emancipation and FDR’s strategic entry into the World War II at the right juncture, Gaddis observes that often, patiently biding your time waiting for the right opportunity – while, perhaps, making some preparations – is far more effective than throwing yourself headlong into every battle that presents itself to you.

Product vs. packaging angles are scattered around the site – for example, there’s an interaction in the utility mental model that explores why we get suckered into “good deals” by irrelevant “packaging” factors.  Here, we’ll dive deep on the productivity angle.

Product vs. Packaging x Utility x Opportunity Costs: Busyness vs. Productivity

“To begin with the end in mind means […] to know where you’re going so that […] the steps you take are always in the right direction.  

It’s incredibly easy to get caught up in an activity trap, in the busyness of life, to work harder and harder at climbing the ladder of success to discover it’s leaning against the wrong wall.

It is possible to be busy – very busy – without being very effective.”  

– Stephen Covey, in “ The 7 Habits of Highly Effective People ( 7H review + notes)

Whether we’re thinking as individuals or managers of a team, our focus should obviously be on effectiveness – not busyness.  Busyness, despite the fact that it’s generally a bad / stressful thing, is in fact viewed as a cultural point of pride, as discussed in “ The Lonely American by Olds/Schwartz ( TLA review + notes).

But as the quote above demonstrates, this doesn’t always lead us in the right direction.  In fact, sometimes, if all we’re doing is plowing through our workload, we won’t notice the most important thing of all, as Covey goes on to explain:

“envision a group cutting their way through the jungle with machetes […]

the leader is the one who climbs the tallest tree, surveys the entire situation, and yells, “wrong jungle!”

[…] as individuals, groups, and businesses, we’re often so busy cutting through the undergrowth we don’t even realize we’re in the wrong jungle.”

The truth is that hard work has no intrinsic value: you can work very hard and spend a lifetime moving a beach with your bare hands… or you can rent a bulldozer, be done in a day, and have the rest of your life to do whatever you want.  Hard work is almost always necessary to create value, but it doesn’t logically follow that hard work is always valuable.  

This is a correlation vs. causation issue that I discuss more in that model: given that hard work is almost always present when value (the “product”) is created, when it’s difficult to evaluate the product – for example, the code of an incomplete software application – we often default to simply evaluating the “packaging” (i.e., whether it looks like people are working hard).

Covey provides a very thoughtful four-quadrant model in The 7 Habits which you can go read yourself.  For now, let’s focus on three specific elements of product vs. packaging in the specific application of busyness vs. productivity.

Element 1: Butt In Chair

One important lesson that pops up across disciplines and time periods: value creation is inherently nonlinearmarginal utility – and the Pareto Principle – suggest that some actions have far more value than others.

Indeed, many of our greatest accomplishments lie not in routine box-checking, but rather in novel and creative insights that, as discussed in the introduction, often come when we’re not actually working. Darwin spent very little time at his desk.

Alex Soojung-Kim Pang’s “ Rest ( Rest review + notes) – while it has a severe flaw in its brutally unscientific and likely dangerous portrayal of chronotypes (see the sleep, trait adaptivity, and  culture mental models) – still does a good job of exploring how important rest and “non-work” activities are to work.

While I’m not convinced by the evidence Soojung-Kim Pang cites on the length of work, I do think in general there’s a strong reason to believe that we’re not more productive working 60 hours a week all the time rather than a more reasonable amount.  Too much work, and we have no time to raise our heads and gain perspective on whether or not we’re in the right jungle.

Additionally, the truth is that most of the time, most people aren’t working anyway.  As Peter Gibbons put it in the Mike Judge classic, “Office Space”:

PETER: Well, I generally come in at least fifteen minutes late. I use the side door, that way Lumbergh can’t see me. Uh, and after that, I just sorta space out for about an hour.

BOB PORTER: Space out?

PETER: Yeah. I just stare at my desk but it looks like I’m working. I do that for probably another hour after lunch too. I’d probably, say, in a given week, I probably do about fifteen minutes of real, actual work.

The corollary to this is that even though the “packaging” is there (butts in chairs), the “product” is not.  

On the other hand, what happens when you compress the workweek?  As put by Jason Fried – the author of the highly sensible “Remote: Office Not Required” –  via Cal Newport’s “ Deep Work” ( DpWk review + notes):

“very few people work even 8 hours a day.  You’re lucky if you get a few good hours in between all the meetings, interruptions, web surfing, office politics, and personal business that permeate the typical workday.  

Fewer official working hours helps squeeze the fat out of the typical workweek.”

Now that’s a win-win game: better for both employer and employee.

Element 2: Visible Markers

Going back to Newport’s “ Deep Work,” ( DpWk review + notes), in his words, many knowledge workers, to prove that they’re making progress:

“do lots of stuff in a visible manner.”  

This often equates to lots of meetings (which pretty much everyone agrees is a waste of time 80% of the time), as well as emails.  

This has major opportunity costs – Newport cites some research comparing the cost of email to a company Learjet, given how much time employees spend on it.

In case you were wondering, Lumbergh loves emails (click the picture for a great HipChat ad that brought him back.)

Volume equals competence, mmkay? Terrific. Ahhh. See this bulk? This bulk is great. Mmm.
I’m gonna ask to see more bulk on your threads. Because remember, volume equals competence, mmkay? Terrific. Ahhh. See this bulk? This bulk is great. Mmm.

The same goes for open offices, which cause massive distraction (thanks to memory and activation energy) – what you gain in being able to monitor everyone all the time is massively offset by the fact that people won’t be able to focus.

I don’t go into the topic of remote work here, but read Newport’s screed on open offices and extrapolate from there; my view is that offices are a left-over function of status quo bias from the pre-Internet era: they make sense in limited contexts, but not in all contexts, and should not still be viewed as the default option

Element 3: Time of Day

Returning to the “ chronotype” mention above, a big element of culturethat I will touch on briefly is the idea that everyone should have the same schedule: 9 to 5, or (if anything) even earlier than that.

Chronotypes are a very poorly understood concept by the public although they are very well understood scientifically; Till Roenneberg’s “ Internal Time ( IntTm review + notes) does a great job of elucidating this topic to a lay audience.

How do chronotypes interact with product vs. packaging?  Well, at companies that offer flextime, managers often discriminate against night owls.  Research by Christopher Barnes finds similar conclusions: even if the employees have the exact same performance, managers prefer early birds to night owls (unless those managers are night owls themselves).  As Barnes summarizes in the linked piece for HBR:

“The implications of this research are not pretty. It seems likely that some employees are experiencing a decrement in their performance ratings that is not based on anything having to do with their actual performance…

Senior managers must intervene in some way to keep supervisors from essentially punishing [night owls]… they should be doing the opposite; if they encourage the use of flextime, they will produce the benefits noted by previous research.

As with other areas of unintentional but proven bias, the advice is to increase managers’ awareness of their tendency to stereotype and why it is invalid. They must be continually reminded to recognize their cognitive tendencies and adjust for them.”

In contrast, what’s sleep researcher Dr. Matthew Walker’s advice for businesses to get maximum productivity?

Walker takes it a step further.  Here, I’ve stitched together some of his conclusions on the ideal office schedule from the beginning and end of his masterpiece “ Why We Sleep ( Sleep review + notes) – my candidate for most important book of the century:

“When a night owl is forced to wake up too early, their prefrontal cortex remains in a disabled, ‘offline’ state.  Like a cold engine after an early-morning start, it takes a long time before it warms up to operating temperature […]

Sadly, society treats night owls rather unfairly on two counts.  First is the label of being lazy […] night owls are not owls by choice.  They are bound to a delayed schedule by unavoidable DNA hardwiring. It is not their conscious fault, but rather their genetic fate.

Second is the engrained, un-level playing field of society’s work scheduling, which is strongly biased toward early start times that punish owls and favor larks.  Although the situation is improving, standard employment schedules force owls into an unnatural sleep-wake rhythm…

[…]

Dr. Matthew Walker, explaining the importance of sleep during his Talk at Google.

“everyone would be present during a core window for key interactions – say, twelve to three p.m. There would be flexible tail ends either side to accommodate all individual chronotypes.

Owls could start work late (e.g., noon) and continue into the evening, giving their full mental capacity and physical energy to their jobs. Larks can likewise do so with early start times.”

Again, this is a clear example of product vs. packaging: the “product” (the productivity of employees) would be massively improved if their pre-frontal cortex wasn’t in an offline/disabled state, but managers forego that utility because they’re focused on the “packaging” – what time employees show up for work (which, in most fields, is totally irrelevant.)

Application / impact: focusing on packaging vs. product damages utility in many ways in the workplace, incentivizing “busyness” at the expense of productivity.

Product vs. Packaging Local vs Global Optimization x Incentives xUtility

“Few [academics] enjoy the writing, and it shows.  To call academic writing dull is giving it too much credit.  Yet to many, dull writing is a badge of honor.

To write with flair signals that you don’t take your work seriously and readers shouldn’t either.”

– Richard Thaler, behavioral economist and Nobel laureate, who writes with great flair in “ Misbehaving ( M review + notes)

As you should be starting to understand by now, one of the major problems with people using “packaging” to assess “product” is that it can lead down negative-utility roads.  

For example, it is extremely obvious, based on any understanding whatsoever of human psychology, that dull writing is profoundly idiotic in any context.  We learn more from things we enjoy.  I refuse to read books that are written terribly because there are plenty of well-written ones out there where I can get far more  utility per minute.

Even fighter pilots use humor (see “ Deep Survival” – DpSv review + notes– by Laurence Gonzales).  Patients comply better with doctors they like (“ Before Happiness” – BH review + notes – by Shawn Achor).

And yet this nonsensical model persists in academia.  Half a world from Richard Thaler, researcher-storyteller Brene Brown, a PhD in social work who studies social connection among Americans (primarily women), makes pretty much exactly the same conclusion in her masterpiece “ Daring Greatly ( DG review + notes):

“Very early in our training [as researchers and academics], we are taught that a cool distance and inaccessibility contribute to prestige, and that if you’re too relatable, your credentials come into question.  

While being called pedantic is an insult in most settings, in the ivory tower we’re taught to wear the pedantic label like a suit of armor.”

This raises one of the key challenges with the product vs. packaging model: like it or not, unfortunately, other people respond to our packaging – often before they even see our product.  

Going to the right school, wearing the right clothes, and saying the right things all contribute to meeting people’s expectations, and thus helping you achieve your own (to the extent that you depend on other people to be employers, clients, and so on.)

Is it absolutely necessary to do this?  It probably depends on your professional capacity, and how you define “success.”  I don’t have the answers. It’s just something to think about.

Application / impact: be aware that you have to make tradeoffs: if you want to focus on product rather than packaging, you may be in for a tough road.

Product vs. Packaging Overconfidence x UtilityPrecision Vs. Accuracy

“This syndrome is often associated with very precise-seeming predictions that are not at all accurate.  Moody’s carried out their calculations to the second decimal place – but they were utterly divorced from reality.  

This is like claiming you are a good shot because your bullets always end up in about the same place – even though they are nowhere near the target.”

–  Nate Silver in “ The Signal and the Noise” ( SigN review + notes)

This “shots hitting a target” metaphor is a common, and good one.  Accuracy assesses whether or not your target is dead.  Precision assesses your grouping.  If you only get one, you want accuracy.  Of course, if you can have both, you should go for it.

A lot of smart intellectuals – including many who do math for a living – eschew false precision.  Indeed, one of Jordan Ellenberg’s few criticisms of Nate Silver in Ellenberg’s “ How Not To Be Wrong ( HNW review + notes) is that Silver’s decimal-point election forecasts convey a degree of precision that isn’t there.

It’s not so much that precision in and of itself is bad – indeed, there are many situations where it is very, very important.  If you are building an airplane that I’m going to be a passenger in, I want your tolerances to be very precise – “roughly good enough” doesn’t cut it.  

Similarly, if you’re planning to operate on or near my aorta, I don’t want you to make a cut “in the general direction of” where you’re going.  It better damn well be exactly, precisely where that cut is supposed to go.  

I could go on ad infinitum.  So, just one more example: the polio vaccines used in the United States for a long time also had to be very precise in their manufacturing process, as David Oshinsky’s “ Polio: An American Story ( PaaS review + notes) explains:

A scientist needed to weaken the virus enough to stop it from causing disease, but not so much that it failed to cause a mild infection that provoked a protective immune response.”

Indeed, an imprecise manufacturing process at one vaccine company – “Cutter” – led to a famous incident in which many children died.

So I don’t mean to demean the importance of precision in contexts where it is appropriate.  However, in most circumstances in business and life, precision is less important than directional accuracy, and precision and accuracy do not always go together.

One of the problems with precision is that it perpetuates overconfidence – both among those who create the analysis and those who consume it.  Charlie Munger, the billionaire business partner of Berkshire Hathaway CEO Warren Buffett, is famous for talking about the importance of being “roughly right” vs. “precisely wrong.”

Believing that precision protects you from downfalls can get you in trouble, as the genius principals of Long-Term Capital Management (LTCM) found out.

So why are people so often precisely wrong rather than roughly right?  Munger explains that it is, in part, what I’d label a product vs. packaging phenomenon:

Some of the worst business decisions I’ve seen came with detailed analysis.

The higher math was false precision.

They do that in business schools, because they’ve got to do something.

This is an extension of the local vs. global optimization problem discussed above: even if it doesn’t add any value, precision may act as a packaging “signal” to professors, employers, or clients that you’ve done your work.

Much similar discussion can be found in “ Poor Charlie’s Almanack ( PCA review + notes).  Indeed, civil engineer Henry Petroski, in “ To Engineer Is Human ( TEIH review + notes), observes some of the dangers of overrelyiance on very precise calculations:

“answers are approximations and should only be reported as accurately as the input is known, and, second, magnitudes come from a feel for the problem and do not come automatically from machines or calculating contrivances.”

While I go deeper into accuracy vs. precision elsewhere on the site – including in the opportunity costs mental model with the integration of correlation vs. causation  (you should go read that section now) – I’ll leave you with one final quote from Nate Silver’s wonderful “ The Signal and the Noise ( SigN review + notes) that highlights the difference between accuracy and precision.

On page 128, Silver quotes Dr. Bruce Rose, the principal scientist at The Weather Channel:  

“the models typically aren’t measured on how well they predict practical weather elements.  

It’s really important if […] you get an inch of rain rather than ten inches of snow.

That’s a huge [distinction] for the average consumer, but scientists just aren’t interested in that.”

Application / impact: Accuracy always has utility.  Precision only has utility in certain circumstances.  Be mindful of whether additional precision actually contributes additional utility.