Rat Beats Human
Mark Chussil
High-powered innovations in competitive strategy: ForesightSims™ simulations, business war games, workshops on strategic thinking, teacher, prolific author including 13 HBR articles, nonprofit board member.
Once upon a time, there was an experiment.
In this experiment rats could press Bar X or Bar Y. Rats that pressed the correct bar would receive a pellet of food; those that pressed the incorrect bar received nothing. (Why do rats in experiments get “pellets” of food? Why not morsels, nibbles, tidbits, chunks, noshes, or treats? Poor rats.) The bars were calibrated, randomly, such that 60% of the time Bar X would dispense the delight and 40% of the time Bar Y would serve the snack.
The rats quickly figured out that the best strategy was to press Bar X every time. Mathematically, that’s the best possible strategy. They got a 60% success rate, the best possible outcome.
A similar experiment, also with 60/40 random odds, was run with humans. It is unknown whether the humans received pellets of food or some other delight.
The humans tried to outsmart the system, to find patterns in the random sequence, to predict the next move. They switched cleverly between Bar X and Bar Y, and they succeeded less than 60% of the time.
No one — well, no human — says a rat is smarter than a human; yet empirical evidence says rats beat humans. But why? But how?
The rat isn’t doing something a human can’t. The rat is doing something a human won’t.
Pride and ego. Rat: None discernible. Human: Pride and ego never rest.
Practicality. Rat: Accepts solution. Human: Figures it out even if there’s nothing to figure.
Data-driven. Rat: Dispassionately gathers and analyzes intelligence. Human: Seeks patterns, rejects the very idea of randomness.
We humans do not compare ourselves to rats. We humans do compare ourselves to other humans. I compare my pellet track-record to yours and you compare yours to mine. You got 57.3% and I got 57.1%; I want to know what you did that I didn’t do. (I may think you got lucky, but you won’t. You’ll take your 57.3% as evidence of skill, wisdom, and/or clean living.) I’ll do my best to adopt your best practices. You’ll go into consulting and sell them to me in a proprietary framework called “Hungry?™ Optimizing pellet acquisition in today’s unpredictable global economy”.
Humans compete not only over pellets but also over planets. A long time ago astronomers strove mightily to devise an accurate model of the geocentric heavens; that is, to write equations that would correctly predict the movement of the planets in a cosmos with the earth at its center. Their models grew more and more complex, and even so failed to fit the data. Then along came a smart human named Nicolaus Copernicus. He published a heliocentric model with planets, including the earth, circling the sun. Copernicus was no rat but he possessed the enviable rat-skill of preferring data over ego.
Did we have a similar showdown when John Bogle, founder of the Vanguard Group and creator of its index funds, went up against stock-pickers? Just asking.
Unless it’s a really, really special individual, a rat knows nothing about random-number generators, probabilities, and expected values. The rat does something different: It learns without judgment from its experience, it is satisfied with a simple solution, and it will learn something new if its solution stops working.
To compete effectively against humans, sometimes it pays to think like a rat.
“Clear? Huh! Why, a four-year-old child could understand this report. Find me a four-year-old child. I can’t make head or tail out of it.” — Groucho Marx as Rufus T. Firefly in “Duck Soup”.
P.S. Want a treat? See this three-minute scene from “Duck Soup” with Groucho and Harpo. It’s got the funniest sight gag I've ever seen.
#competing #strategy #strategicthinking
Global Consulting Partner at Roche & Managing Partner at DalhoeferLauper
2yMark, I already loved the title but the fact that you use the great Marx Brothers at the end really makes this a very special post! The content is of course also excellent...
Principal at McCarthy Analytic Consulting LLC
2yMark, I would observe that what you are seeing is an exploit vs. explore strategy trade-off. Humans get the problem intuitively, but spend excessive time continuing to explore given the experimental setup. The rats just figure out where the odd are better, and then go full exploit. In the context of a food source this makes perfect sense. Eat everything where it is most plentiful first, then switch when the supply is exhausted. If the experimental structure was 60/40 for 40 plays, and then 40/100 afterwards, the rats would have never figured this out. Rats (and humans) have built in operating algorithms that in general work for their species, given the environmental and social reality. This experiment is pretty well aligned for a rat friendly heuristic. I would also observe that the problem people have here is that humans in general just don't have good statistical intuition, as well as not understanding that there are apparently patterns in random noise. The humans also understand that they are in an experiment, and that there is a human experimenter on the other side, likely trying to fool them. In other words I suspect the rats are not distracted by all the theory of mind issues that entertain and distract the human subjects
General Manager at The-Firm (IL) イスラエルのテクノロジー企業に関する競合情報
2yThanks, Mark. To the point, as always. Pellets of wisdom :-) There's a somewhat similar experiment, where a large transparent bottle is placed with its bottom on the window, facing the light, and the narrow opening faces into the room. Now, bees are considered way smarter than house flies and are known to have elaborate communication and navigation skills. However, when the bottle was filled with bees, they all turned toward the light and buzzed around without finding the exit, until they died, collectively. OTOH, when the bottle was filled with house flies, they buzzed and flew randomly, or seemingly randomly, until by mere chance they got out of the bottle, one by one. No ego or agenda, the bees were simply too smart for their own good. The flies' ignorance proved to be a life-saving bliss. Not the same bottom line, but close - if you hit a wall, don't overthink it. Just turn around, experiment paths, and free your mind from the original plan.