(This article first appeared in Real Estate Investor's Monthly.)
Malcolm Gladwell’s Tipping Point has been on the best-seller list forever. He now has a new book called Blink that will no doubt do the same. Should you read them? Probably. There are some lessons that apply to real estate investment and other aspects of your life. But the best-seller status is quite misleading.
Gladwell is a decent writer whose shtick is collecting interesting anecdotes or experiments with unexpected facts about subjects like marketing and body language. His books have little organization and generally do not wrap up the anecdotes into broad principles. Rather he just recites the anecdotes and the book suddenly ends after one of them.
The basic idea of Blink is that sometimes better decisions can be made from minimal information than from larger amounts of pertinent information. That’s interesting, but Gladwell also admits that sometimes it’s better not to make snap decisions. We already knew that. So how do you tell when fast decisions based on limited information are best? Gladwell does not really give a rule, although he gives some examples of situations where snap decisions seem best. We really need a rule. If he cannot come up with one, he should not have written the book. It’s like an unfinished attempt to solve a mathematical equation.
Gladwell notes that too much information can cause analysis paralysis. But he doesn’t answer the key question of how much is too much.
His first anecdote is about a fake kouros or ancient Greek statue that the Getty Museum paid millions to acquire. Scientists and lawyers hired by the Getty said it was not a fake. But long-time art experts took one look at it and thought it was fake. Interestingly, the art experts could not articulate any specific problem. Rather, they just had a bad feeling about it based on having seen many, many similar objects that were real. Turned out they were right.
The real estate parallel would be looking at a building. As I became more experienced, I acquired a sort of x-ray vision. I also came up with things like the look-down walk around which is described in my book Checklists for Buying Rental Houses and Apartment Buildings. In that, you walk around the property looking down at the ground looking for changes in the pavement or ground. If you see any, you have to find out why they are there.
Generally, I think an investment Uncle Louie can see things that are wrong or sense them. It’s not guaranteed, but stuff is very easily overlooked as I explain in Checklists for Buying... . That book is an extensive checklist that would go against Gladwell’s thesis, though. It calls for acquisition of massive amounts of information, but I stand by the book. Gladwell’s experts would only add an ability to possibly sense things that are overlooked by my very thorough checklists.
His second anecdote is about a psychologist who studied videos of married couples discussing their marriage. He identified 20 categories of behavior in such conversations. Viewing just one hour of such video, he can predict with 95% accuracy whether that couple will still be married in 15 years. Viewing only 15 minutes, he can predict with 90% accuracy whether they will still be married 15 years later. With just three minutes observation, he is still highly accurate, although no percentage was given.
This would be very useful for screening tenants and selecting employees. That would require similar research, but with a perspective of predicting tenancy or employment duration, not marriage.
A very interesting anecdote regarding which doctors get sued is probably pertinent to landlords. Turns out patients do not sue doctors for malpractice because they committed malpractice. Rather, they sue doctors for malpractice because the doctors did not make the patient like them.
“Dr. House” of the TV show would get sued for malpractice every day. Landlords, no doubt, would suffer the same fate. I know that Landlording author Leigh Robinson once was about to be sued by an elderly woman tenant in one of his mobile home parks. He went to meet her. He is a likable guy. She liked him and refused to sue.
Personable doctors never get sued. Less personable ones often do.
Confucious said that man who does not have smiling face should not open shop. Wise words and They apply to landlords and doctors as well.
I would add that gurus who brag that they never lay eyes on their tenants and urge you to do the same are also more likely to be sued and more likely to lose. Try explaining to a jury that you hate to ever lay eyes on tenants.
Performance can be affected to an amazing degree by priming. That is, verbal or other suggestions that a person will perform well or poorly before any performance.
One test Gladwell writes about put a bunch of words that suggested being old—like “gray,” “Florida,” “bingo,”—among other neutral words. This caused the test takers to walk more slowly when they left the test. Similar tests caused people to behave rudely or politely, to be smarter or dumber on knowledge tests, to cooperate with other people or to not cooperate, etc.
When I was a real estate agent, one trainer taught us to avoid words like “deal,” except when referring to the competition as in, “Old Joe down the street? Oh, yeah. He’ll give you a good deal.” I did not adopt that. If I want to point out something adverse about Old Joe I will do it directly not by subterfuge. But we were assured this worked and I would not be surprised.
The lesson to be learned from the effectiveness of priming is not that you should use it to manipulate people improperly, but that you can use it to get better performance out of yourself and others.
Gladwell makes much of the fact that what people say is often very different from what they do. That’s well known. I have mentioned an incident at my college to prove that point a number of times. The school took a poll to see if the students would use a quick-press service. They said yes. Then the services was instituted, not used, and discontinued.
When I was a real estate agent, a newspaper ad salesman for the Philadelphia Daily News—a tabloid—tried to get my firm to advertise in their paper. The boss thought it was not our demographic. The paper suspected that their demographics were better than everyone thought and did a clever test. They asked people which paper they read and most said the Inquirer or the Bulletin. Few admitted to reading the News. But they also asked the same people which columnists they read and included columnists from each of the three daily papers. Lo and behold, a great many more read the columnists who were only in the News than admitted to reading the News.
Gladwell relates a number of anecdotes about people saying they wanted X when their actions revealed they wanted Y. In some cases, the people simply do not know their own mind. In others, they are ashamed of what they really want or believe and say what they think will make others think more highly of them instead.
So if you are trying to figure out what motivates people in marketing of rentals or for-sale properties or to motivate employees, you need to be mindful that just asking people what they want often elicits inaccurate information. Better you get the information by observing behavior unseen or by indirect inquiry that disguises what you are really trying to find out.
What, you should wonder, does this have to do with the book’s Blink title? Darned if I know. Some best selling non-fiction authors like Gladell and Rich Dad Poor Dad author Robert Kiyosaki seem to share an ability to cast an “emperor has no clothes” spell over readers. Decent public speakers can do the same thing. Beware.
Gladwell tells of a test called an Implicit Association Test. You can find them on the Internet and take them. They force you to associate words with characteristics and thereby reveal your biases like racial and gender. Nowadays, most educated people claim they have no such biases. Wanna bet? Try taking an IAT if you really want to know. Gladwell describes the test as leaving him feeling creepy. It doesn’t matter how many times you take it (assuming each has different questions to achieve the same purpose). You cannot twist the score to what is politically correct. The real you always shows through.
This could be useful in a bunch of areas if you could devise an effective IAT for the area you were interested in. For real estate investors, you would use it to screen tenants and employees. If you want to have partners, this would be a good way to screen them.
Gladwell seems to believe that retired Marine colonel Paul Van Riper is a competent combat commander. He then discusses a war game in which Van Riper defeated active-duty commanders using Blink techniques.
First, there is no such person as an expert combat commander. Why? They do not get enough practice. Vietnam vets are now at least 54 years old and few of them saw much action by, say, World War II standards. All subsequent “wars” have been momentary blips like the 100-hour Desert Storm or Blackhawk Down.
While Van Riper may, indeed, have been better than most, his combat experience is still what pro baseball players call a “cup of coffee.” As in, “Did you ever make it to the majors?” “Yeah, I had a cup of coffee in September of ’02.” Plus, notwithstanding all the hype on the History Channel and the Military Channel etc., the military is an inept government bureaucracy best described by the acronym SNAFU—situation normal; all fouled up. Finding lessons in a military-run war game is like trying to improve search-and-rescue techniques by watching a pre-school Easter egg hunt.
Van Riper probably won because he was retired at the time and therefore the only guy in the game not trying to stay on the good side of his bosses so he could get the next promotion. He was therefore the only contestant free to use his common sense. I have often said that if you let me pick the personnel for my military unit and my tactics and strategies, I could literally run circles around a regular U.S. military unit in a war game. For example, I would hire truck mechanics who were actually experienced truck mechanics rather than cooks who were switched to motor pool for unknown reasons after having completed cook training.
Another Gladwell anecdote is about improving screening of heart attacks in an emergency room at the extremely busy low-budget Cook County Hospital in Chicago. As is often the case with innovation, necessity was the mother of invention of a far more efficient way to screen possible heart attack patients. Normally, doctors do a bunch of expensive time-consuming tests. Cook County simply did not have that luxury. One of their doctors studied the matter and discovered that the optimum screening was three questions about unstable angina pain, fluid in the lungs, and systolic blood pressure below 100. Although there was great resistance, further study revealed that these seemingly inadequate tests were the best triage formula.
Gladwell cites the 1999 accidental shooting of Amadou Diallo by four undercover NYC cops as an example of Blink that did not work. He then provides an excellent and informative discussion of how adrenaline and chase situations adversely affect the Blink abilities of humans and how to reduce those effects.
Interesting reading, but you have to extract your own universal decision-making rules from the material. JTR
(below is a second article referring to Blink by Malcolm Gladwell)
In the 10/06 issue, I questioned the message of Malcolm Gladwell’s book Blink. Basically, it suggested that snap decisions were often the best ones. I complained in my review, and Gladwell admitted, that this was not always the case—even in the book—and that Gladwell failed to posit any rules as to when snap decisions are best.
Now the 4/23/07 Newsweek tells of a sort of anti-blink book called How Doctors Think by Jerome Groopman, M.D. Basically Groopman generally does not trust intuition and prefers deliberation, caution, logic, and rigorous analysis where the stakes are high. (Both Gladwell and Groopman are writers for New Yorker magazine.)
I suspect snap judgments are valid only when the decider has no choice because of limited time available. Such snap judgments are best made by experienced experts. Otherwise, the best decisions in areas where humans have pertinent expertise and knowledge are the deliberate, thoroughly analyzed, well-thought-out ones. JTR