10 powerful mental models to make the best out of the world around you
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1. Inversion Mental Model
Rather than thinking about your desired outcome, consider the outcome you'd like to avoid.
"Avoiding stupidity is easier than seeking brilliance."
2. Pareto Principle
Known as the 80/20 rule; most results aren't distributed equally.
• 20% of your traffic yields 80% of your leads
• 20% of the work generates 80% of the returns
• 20% of your time produces 80% of your results
3. Randomness
Much of the world is composed of random, non-sequential, non-ordered events.
“Life is randomness, don’t expect to understand it. Learn to live it.” – Evol
Some events are impossible to predict.
4. Opportunity Costs
Doing one thing means not being able to do another.
We live in a world of trade-offs, and the concept of opportunity cost rules all.
Is "the juice worth the squeeze?"
Everything has an opportunity cost.
5. Trust
The world operates on trust. Every day we trust drivers, clerks, chefs, and many others.
A trusting system is one that tends to work most efficiently; the rewards of trust are extremely high.
6. Incentives
All creatures respond to incentives to keep themselves alive.
Sometimes the solution to a behavior problem is simply to revisit incentives and make sure they align with the desired goal.
The rule of life is to repeat what works and has been rewarded.
7. Leverage
“Give me a lever long enough and I shall move the world.”
With a small amount of input force, we can make a great output force through leverage.
Understanding where we can apply this model to the human world can be a source of great success.
8. Relativity
“If the earth is moving through space, how come I don’t notice?”
The answer is “Relativity”!
It can also show us the limits of our perception. And how we must be open to other perspectives if we truly want to understand the results of our actions.
9. Diminishing Returns
The incremental benefits you get from an investment get increasingly smaller.
The sooner you notice diminishing returns, the sooner you can jump on the projects that are more valuable to your business's growth.
10. Circle of Competence
When ego drives you, you have blind spots.
When you’re honest with yourself, you know where you’re vulnerable and where you can improve.
Understanding your circle of competence improves decision-making and outcomes.
We can’t keep all of the details of the world in our brains, so we use mental models.
The quality of our thinking is the quality of the models in our heads.
The more models you have
The bigger your toolbox
The more likely you are to have the right ones in the right situation.
Start reading 100 mental models.
With the help of books, cards, maps, quotes, audiobook,... it will internalize mental models in your head so that you will use them automatically.
The internet was invented in 1983.
There was a time you had to leave your house to socialize, watch movies, find a book, buy stuff,...
The internet provides you an endless supply of knowledge, information, and services that allow you to learn, communicate, take care of your financials, entertain yourself, build networks, and even make money…