"And then what?": Second-Order Thinking

While I was casually chatting with one of my colleagues yesterday, the topic of how to be more prepared for presentations and become a better decision-maker came about. That's when I introduced him to the concept of second-order thinking.

When trying to solve a difficult problem, it's never wise to simply have a short-term outlook on how your decision will play out across different outcomes. Sometimes, solving an issue can unintentionally trigger another & there might be a more optimal solution being overlooked. Some decisions seem like wins at first, but turn out to be losses over time. What looked like a good decision earlier can be a bad one in the end.

This is first-order thinking, the default for most people. It's short-sighted, reactionary, simplistic & superficial.

The tendency to seize the first available & most obvious solution without considering potential unintended repercussions down the line is among the leading causes of bad decision-making. This is especially dangerous as you can unconsciously include your own biases in the equation. It is why first-order thinking is also called thinking 'within the box', the box being our past experiences & beliefs.

Sometimes, it's not harmful as a good part of our daily quick decisions falls into this category e.g. what outfit to wear for work & what to eat for dinner. However, it becomes detrimental when you subconsciously allow your personal biases to cloud your judgement especially when it can affect others around you, leading to choosing the most convenient option that provides short-term gains at the expense of long-term pains. It fools us into making false dichotomies i.e. thinking in binary.

Introducing: Second or nth (higher) order thinking.

First proposed by Howard Marks, it's about examining & unravelling the long-term implications of our current decisions to make informed ones that will stand the test of both time and unintentional/unforeseen circumstances.

Higher-order thinking is foresight, not hindsight. It involves asking tough & uncomfortable questions about how our decisions will affect us & others. It forces us to go beyond intuition/natural & seek hard truths by exploring unknown territories & doubting a seemingly obvious choice.

Examples of such questions may include the following:

1. How can I make decisions with compounding positive outcomes in the future?
2. Is this decision attractive only because it has an immediate positive effect?
3. What can be the potential downside of this decision and its effect later?
4. How does my decision impact others?
5. What do others think about my decision?
6. Why do I think my decision is right?
7. What will be the consequences of this decision in different timelines?
8. How could others rebut my decision & how would I defend it?
9. And then what?

There are many useful second-order thinking templates out there that you can refer to in guiding you on how to apply this mental model. Here are a few that I managed to find:

Second-order thinking takes a lot of work. It’s not easy to think in terms of systems, interactions & time. However, in my opinion, this is among the secret ingredients that differentiate extraordinary from mediocrity. Exceptionalism comes from seeing things that other people can’t see.

I find that some roles do naturally develop this train of thought thanks to their line of work. A chess player has to mentally play out outcome permutations of moving just a single chess piece. Programmers meanwhile are conditioned to try & cover as many edge cases as possible.

Leaders are almost expected to apply this mental model, especially when dealing with a crisis at work.

For example, should a manager micromanage to quickly resolve an issue at the cost of increased dependency by their team members, or should they entrust their team to do it as a way to empower them at the expense of the longer time taken?

Ask yourself: Is it better to optimize for long-term gain at the cost of short-term pain?

Naturally, 1 question that popped into my head when discovering this mindset is: How do you differentiate between this and overthinking?

To me, the key difference is that overthinking is about dwelling on the problem while problem-solving (to which second-order thinking belongs) involves looking for a solution. In other words, problem-solving leads to action while overthinking does not.

Coming back to my colleague's question, I told him that whenever I'm presenting my work, I always try to predict & anticipate the audience's questions or doubts to cover as many holes. This is to give a good & lasting impression that I'm ready for all possible scenarios.

All in all, this is yet another interesting mental framework that I applied regularly that I would like to share with everyone. I hope it's useful and perhaps you can give it a try when you find yourself at an important juncture in your life.

References:

1. Farnam Street. (n.d.). Second-Order Thinking: What Smart People Use to Outperform. Retrieved from https://fs.blog/second-order-thinking/
2. TechTello. (2022, January 27). Second Order Thinking: Thinking Practice To Make Better Decisions. Retrieved from https://www.techtello.com/second-order-thinking/
3. UnTools. (n.d.). Second-order thinking. Retrieved from https://untools.co/second-order-thinking
4. Somani, A. (2021, February 22). Second-order thinking, Understanding Bundling and Personal Growth. LinkedIn. Retrieved from https://www.linkedin.com/pulse/second-order-thinking-understanding-bundling-personal-amit-somani/