#21 Effort Bias: Why you should let them see you sweat

Why do we teach kids that it's all about the effort, when as adults, we're far more concerned about the outcomes. In this episode, Mel and Dan look at why 'quicker and easier' could be the exact opposite of what we really want.

Mel: 00:18 Hi, and welcome to Bad Decisions.

Dan: 00:20 The podcast that helps us understand why we choose what we choose.

Mel: 00:23 Why we think what we think.

Dan: 00:24 And how to exploit this stuff for fun and commercial gain.

Mel: 00:27 Ethically.

Dan: 00:27 Always ethically.

Mel: 00:28 I'm Dr. Mel Weinberg, I'm a performance psychologist.

Dan: 00:31 And I'm Dan Monheit, co-founder of HardHat, a creative agency built for today. So, you wouldn't believe it, Mel.

Mel: 00:43 Tell me.

Dan: 00:44 Once again, Australia was going to the polls. This morning or yesterday or something. Who's our current Prime Minister?

Mel: 00:50 Who knows?

Dan: 00:51 It's Joe Moe? Momo. ScoMo. Anyway, someone's decided that everybody needs a free hotdog and we're going to go and vote. Are we voting for a new prime minister again?

Mel: 01:02 Apparently.

Dan: 01:02 This has got me thinking about this weird thing that we seem to do where voting for a new Prime Minister, you need to ask yourself what millions of people will be asking themselves, "Will this person be a good Prime Minister?"

Mel: 01:17 It's a tough question.

Dan: 01:18 It's a really hard question, and there's a lot of facets to what would make someone a good or a bad prime minister, and it made me realise, one of the things we seem to do is we substitute easy questions for hard questions almost without out brain knowing.

Dan: 01:31 So it's like, "Will this person be a good Prime Minister?" "I don't know. That's really hard, ask me an easier question." "Is this a nice person? Would you like to have a beer with this person?" "Yeah, okay, yeah. I probably would. Well, therefore they would probably be a good Prime Minister”.

Mel: 01:44 Much easier question, "Hey, who do I want to go to lunch with?"

Dan: 01:47 Yeah, and I was thinking how the same thing probably happens with investing in publicly listed companies as well. So, you say, "Should I buy shares in Tesla?" And you go, "Well, is the current Tesla share price the right price?" "I don't know. Like there's a lot of very hard maths that I would need to do to work out, a lot of things I don't understand." So, an easier question I can substitute for myself is, "Do I like the Tesla brand?" "Yes, then I should buy shares in it."

Mel: 02:12 Yeah, I mean this is basically why we have heuristics. Right? Heuristics are shortcuts. They substitute really hard questions for easier ones that we much prefer.

Dan: 02:22 Yeah, totally, and so I guess one of the places where we often are asking ourselves a hard question is, "Is the price for this thing correct?" Or "How much is this thing really worth?" And we found a lot of ways to give ourselves easier questions to answer. So, we look at tricks like, "What is the price of this item?" Or "What is the brand of this item?" Or "What is the shop that I am buying this item from?" And we try to use all of those things as easy answers, and it seems that one of the other interesting ways that we try and determine the value of something is, "How much effort went into making this?"

Mel: 02:59 Good, Dan. See, you're giving us the effort heuristic!


Mel: 03:11 The effort heuristic basically describes how we will ascertain the quality or the worth of an object by our perception of how much time and effort went into it. So, we substitute effort for quality. Effort's our shortcut for quality, and we've talked about shortcuts in a lot of different episodes, one of the ones that quickly comes to mind is the availability bias.

Dan: 03:36 Is it available for you? That episode?

Mel: 03:37 It's easily available to me, yes. In that episode we talk about how availability is a shortcut for the frequency of something, and just like that, in the effort heuristic, effort becomes a shortcut for quality.

Dan: 03:49 Yes, I mean it would be great for people to know that each of these shows take us like, what is it? 17-18 hours of research?

Mel: 03:55 So long. Yeah.

Dan: 03:56 30 hours of recording, which we lovingly edit down to 18-22 minutes. But there's no point telling people that, but if they knew, they would really rate these shows a lot more higher than they do.

Mel: 04:08 There are a couple of reasons why this effort heuristic exists and sort of why it's there to help us. You've got an example from an evolutionary perspective?

Dan: 04:15 I was just thinking that today things are pretty complicated. Trying to work out the value of a set of AirPods is pretty tricky, because there's a complex process for how they somehow get invented and then end up on a shelf in front of you, but at some point in our past there's probably a much tighter correlation between effort and quality, because you're probably buying things from the people who made them by hand.

Dan: 04:36 Everyone was kind of like a craft person or an artisan, and within reason, the more time somebody spent making a horseshoe or a sword, or a basket, probably the better and higher quality that item was.

Mel: 04:50 Yeah, so you're basically saying that there was a reason why effort would be a good substitute for quality. It makes sense, right? Back in the day, and if we take that to today's society, there's a concept called learned industriousness. Yeah, fancy word. To basically describe how effort gets rewarded, especially when you're younger. You put a lot of time into something, you put a lot of effort into something and you're told that will get you the outcome, because of that, effort itself gets rewarded and it's a weird thing, because if you think about effort, about what effort involves, if it involves physical exertion, you're putting in effort when you're fatigued by it, right? So, it's something that we would typically avoid, but according to learned industriousness what actually happens is because that effort gets reinforced we learn to love it.

Mel: 05:33 You've run marathons?

Dan: 05:36 I've ran a marathon. I ran most of the marathon and hobbled some part of it.

Mel: 05:38 Right, and you put yourself through a lot of hard work. You put yourself through a lot of physical exertion, you put in a lot of effort, but you loved that. The effort actually got rewarded.

Dan: 05:47 Yeah.

Mel: 05:48 So, instead of the effort being something aversive, something that you avoided, you trained week, after week, after week, and you pushed yourself. A lot of athletes do this, I'm putting you in the category of athletes.

Dan: 05:56 Whoa, yes.

Mel: 05:57 A lot of athletes do this.

Dan: 05:57 I'm an e-sports athlete now.

Mel: 05:59 That'll do. But you put in the effort, and you actually enjoy it. People say they loved the grind.

Dan: 06:04 Yeah, so you reckon that's a learned thing. Because that's not natural, right?

Mel: 06:07 Well, we've been conditioned to actually enjoy the effort.

Dan: 06:15 Yeah, I think you're right. If I think about school, there is this idea of romanticising effort, that hard work is good, which it probably is to a degree, but also sometimes people need to work harder just because they're less good to start with, right?

Mel: 06:26 Speaking of hard work and degrees takes me back to my academic days with loads of marking, and one of the worst things that you have to do in academia is marking, and one of the things that happens is the students will come back and complain about their grades. If I can tell you the number of times that students came to me and said, "I only got a credit? But I put so much time into it, but I put so much effort into it!" and I don't know, call me a hard ass, but it still wasn't any good.

Dan: 06:53 They were trying to punk you with the effort heuristic, right?

Mel: 06:56 I'm not falling for that. You're still getting a credit.

Dan: 06:59 So what we're saying is often times effort does not directly correlate to goodness.

Mel: 07:02 Right, and so we can make errors because of the effort heuristic. We sometimes overestimate the correlation between effort that gets put into and the outcome. Sometimes there are a whole bunch of reasons why the effort doesn't necessarily correlate so strongly with the outcome. Like if somebody's just not very talented for example, you could put in all the effort in the world, but the outcome's still going to be subpar.

Dan: 07:26 I guess this all feels pretty natural and we can all think about how we could convince ourselves to think that something that took more effort would be worth more, but surely somebody somewhere in the world has put in the effort, the highly valuable effort, of connecting some research on this.

Mel: 07:42 Well, would you believe they did?

Dan: 07:45 This is amazing.

Mel: 07:51 And it took four authors of the study back in 2004.

Dan: 07:54 Wow, this must be a pretty good paper. Four authors!

Mel: 07:56 Yeah, Kreuger et al. It's known as the Poem Study, and they split people into two groups, and they gave then a poem to read, and they asked them to rate the quality of the poem. They asked them, "Did you enjoy the poem? And if this poem were to be sold to a poetry magazine, how much do you think it would be worth?"

Dan: 08:21 A poetry magazine?

Mel: 08:21 Yes, that was the study.

Dan: 08:22 What year was this study done?

Mel: 08:23 2004. When poetry magazines were all the hype.

Mel: 08:26 But they gave both groups a whole bunch of information about the author of the poem, about where they came from, their name, etc. the only thing that was manipulated was how long they told participants that the author spent writing the poem. Group one were told that the poem took four hours to compose, and group two were told all the exact same information except that the poem took 18 hours to compose.

Mel: 08:55 Would you know it, at the end of the study what they found was that the group who were told that the poem took 18 hours to compose rated the quality of the poem as much higher, and it's worth much higher.

Dan: 09:06 Surely not. Surely not.

Mel: 09:07 Uh huh. Believe it.

Dan: 09:09 Surely these guys didn't stop at poetry, though.

Mel: 09:11 There were a couple of other studies.

Dan: 09:16 Yeah. Which we aren't going to talk about?

Mel: 09:16 Well, we could talk about one of them had to do with rating the quality of paintings for example. They had a group of non-experts and then a group of self-identified experts, and just to throw it out there, I'm critical and curious, and suspicious of anything that asks people to self-identify as experts.

Dan: 09:31 Well, I think what's great about this story, because what happened to the self-identified painting experts?

Mel: 09:36 Well, wouldn't you know it, they rated the quality of the paintings much higher, if they were told that the hours spent painting them were longer.

Dan: 09:45 Yeah, so basically everybody got punked, including the self-identified experts.

Mel: 09:48 Exactly.

Dan: 09:50 So, I mean this is really interesting, but also kind of troubling as somebody that has a business that is in the world of selling ideas. It's really hard to assign a value to an idea, and a weird thing that's happened in my industry, and in a lot of other industries like ours, is that clients want ideas. They don't know how to value them. So, what everybody just kind of agreed we're going to do, is we're just going to quote and pay based on time/effort. Even though everybody really knows that this is a horrific approximation for how much value is created.

Dan: 10:26 The idea of trying to break the paradigm that we pay people for hours is just far too big and far too confusing. So, the approximation we use in our industry for value is also effort.

Mel: 10:37 Yeah, so the people will have ideas like a light bulb, it will come to them.

Dan: 10:40 Yeah, I mean how long does it take to crack a campaign idea, like your whole life plus five seconds. So, you can charge a client for your whole life. Tried. Didn't work. You can't charge a client for five seconds, because that's going to come out like $1.30, on a good day, so you kind of have to find something in the middle and some businesses do manage to crack some model where you do value based pricing.

Dan: 11:00 Like "What is the value of this idea to your business, and how much can we improve sales, or other key metrics?" But the reality is, it's so complicated, if you come up with a new tagline for a brand, and then you see sales go up, it might have been because of the tagline, or it might have been because of better distribution, or it might have been because they're competitor ran out of stock and nobody could buy them, or it might have been because the weather was good or bad. It's so hard. So, it's like, "How about we just pay you for the hours that somebody spent thinking about this, or not thinking about this, but were meant to think about this?"

Mel: 11:27 Right. So, if we understand that effort is used as a substitute for quality, tell me please how can brands use this to their advantage?

Dan: 11:34 This is exactly the right starting point, because while it would be good to try and convince people that this is not always the best way to value something, that's really hard. So, if we just lean into the fact that this is what people think is happening, the long and the short of it is, what we need to do is find ways to, I want to say make our processes longer and more complicated, but really what I mean by that is, not to manufacture fake things. Most things that people do, do have long complicated processes, and I think the way we need to play this heuristic is to make those long complicated processes more visible to the people we're selling to, than they otherwise would be. And a lot of the time we don't even notice the complexity, because we're in it all the time.

Mel: 12:14 Yeah, so there's some examples of that, right?

Dan: 12:16 Yeah. Of course there are. So, we see this in a bunch of places. One of the things I like to think about is restaurants. If you designed and built a restaurant anytime up until, I don't know, call it 10 years ago, there was a pretty predictable format where you have all of the service areas out the front, and then kind of hidden away behind a wall you have all the kitchen staff.

Mel: 12:36 So nobody sees the mess.

Dan: 12:37 Nah, don't see the mess, don't see anything. The food just magically appears through these doors. If you look at the trending restaurants in the last 10 years, every hot restaurant, at least in Melbourne and Sydney, I'm sure other places in the world, the kitchen is smack bang in the middle of the restaurant.

Mel: 12:51 So much fun. It's so much more fun that way.

Dan: 12:53 It's so much more fun! And not only is it in the middle of the restaurant, but there are seats, and I think often the best seats in the house are sitting around the kitchen watching the people craft the food. So we are not only exposing, but we're probably celebrating and romanticising the effort that goes in, and it seems that people are more patient and happy to pay more when you can actually see what is taking the time and the effort going in.

Mel: 13:15 And if somebody were to do research on that, if there isn't some already that we just haven't looked up, I'm sure they would enjoy the quality of their food and rate the quality of their food much better.

Dan: 13:23 Yeah, without a doubt. When you've seen the chef cut the sashimi right in front of you, you can't help but think that it's fresher and more expertly prepared.

Dan: 13:34 Some other places we see this stuff happening: we often used to talked about comparison websites on the internet, and when I say we used to talk about this, nerds in my industry used to talk about this, and the idea that often historically, and maybe it's still the case, those comparison websites were slowed down. So, you go into one of these websites and you say "I want to find flights from Melbourne to LA," and it could find that for you in half a second, or faster, but the perception is, "Well, if it only took half a second, like did you really go out and have a look at all of the possible places you could find airfares?" So, the idea was that these websites were slowed down a little bit to give the perception that they were doing a better job, there was more effort going into it, and therefore a more valuable outcome that come out the back of it.

Mel: 14:17 Tricky, isn't it?

Dan: 14:19 Yeah, the last probably interesting example I see of this is, if you think about tracking packages that come from overseas, we've all become accustomed to the idea that you buy something on a website, then you get a tracking number, and you go and look it up, and while in one respect you're looking it up just because you want to know where it is and how far away it is, what companies like DHO and FedEx have done an amazing job of, is showing all of the little steps that have happened.

Mel: 14:43 Every time somebody's touched it.

Dan: 14:44 Yeah. It got moved from the left side to the right side of this warehouse in this city, and then it got put on a truck and moved 200 meters down the road to a different dispatch facility, and then somebody put a sticker on it with your name on it, and so all of these things add steps, and add complexity. Well, they don't add steps and complexity - they surface the steps and they surface the complexity that's inherent the process, and you can't help but marvel at how this one box of shoes has been touched by dozens of people in dozens of cities or facilities just to make its way to little ol' me in little ol' Melbourne.

Mel: 15:18 When you think about it, it seems so unnecessary, but we just accept that, "Oh, it's getting tracked, there are people along the way doing things, it's getting to me, it's being worked on." I'll accept it. I'll wait.

Dan: 15:24 Yeah, all that effort is making this a more valuable process.

Mel: 15:27 That's right.

Dan: 15:28 So I think for brands, the goal is to show people what is happening and celebrate it, and surface it, and make sure people understand all of the effort that's going in knowing that they can't help but assign that effort to value.

Mel: 15:41 Cool.

Dan: 15:42 What about peeps?

Mel: 15:43 Well, for just the little ol' people in the picture, one of the key things for this is to understand that people are going to judge your value based on the effort, and not necessarily based on the actual effort, but based on the perceived effort. So, it's really important that you make it look like you put effort into whatever it is that you're doing, which can't be overstated.

Dan: 16:03 Wear a clean t-shirt, right?

Mel: 16:07 Right. I'm going to touch on something that some people might think is a little pedantic, but we're going to talk about spelling mistakes. Spelling mistakes, and even grammatical mistakes, is a sure fire way to let people know that you haven't put in effort, and people say, "Oh, it's just a spelling mistake, it's just a typo." It's not, because people are actually judging your worth and your value based on your spelling mistakes. So, if you're writing something, if you're writing an email to somebody, perhaps to a client, and you're trying to get on good terms with them, and you want them to think that you can produce really high value work, the absolute worse thing you can do is put a spelling mistake in there.

Mel: 16:45 Because they are going to see that, and it's going to give them a very quick indication that you haven't proof read it, that you haven't put enough effort into it. They might even know that you can spell. So, it's not even about whether or not you can spell, but it gives a very quick indication that effort just hasn't been put in, and that means that maybe you're not very good at what you do.

Dan: 17:06 Yeah you lose count of how many times you see comment threads on the web. Somebody writing, really like a brilliant piece of prose that's rebutting an argument of something that somebody else has put forward, and the whole thing is incredible and intelligent and compelling, but they've used the wrong "your."

Mel: 17:24 Your and you're.

Mel: 17:26 Or there, their, and they're?

Dan: 17:27 Yeah, and all of a sudden the whole thing is discredited. Because you've used the wrong "there", and that means you haven't put the effort in, and means this is not valuable.

Mel: 17:35 That's right. So, even if you don't care about spelling, everybody else reading your work does.

Dan: 17:40 Yeah, all right, that's a tough, tough pill to swallow, but thems the breaks.

Mel: 17:46 It's just not that hard, just check your spelling.

Dan: 17:47 Yeah, I mean, you even get little squiggly lines underneath the things.

Mel: 17:49 Exactly. You're going to take me back to my marking days, which we've already touched on once this episode. I'm not interested in going back there.

Dan: 17:55 Yeah, you are starting to shake a little bit.

Mel: 17:57 Yeah, sorry.

Dan: 17:59 All right, probably a good time to wrap up.

Mel: 17:59 Let's wrap up.

Dan: 18:00 All right. So, the effort heuristic.

Mel: 18:07 Is a shortcut that we use when we're trying to estimate the quality of something that we don't really have much else to go on.

Dan: 18:12 Yeah, so you can try and change the world, and bust the paradigm and convince people they should be paying based on value, or you can just lean into it and say, "Yes, you are paying for effort, and look how much we put in."

Mel: 18:20 Yep, and remember, it's the perceived effort. More than even the actual effort.

Dan: 18:25 Awesome. Well, I think that concludes take 192 for this episode.

Mel: 18:29 We really put so much into this, guys.

Dan: 18:31 Yeah, I feel my dad jokes have really lifted over the course of the show as well.

Mel: 18:35 Yeah, well done.

Dan: 18:35 Cool. All right. We're out.

Mel: 18:37 We are out.

Dan: 18:37 We're done. Thanks. See you guys next time.

Mel: 18:39 See ya.