10 Mental Models Explained

Summary

In this video, Vicki shares 10 powerful mental models that simplify complex problems and enhance decision-making. She explains models like the 80/20 rule, theory of constraints, first principles, Occam's Razor, and game theory, providing real-life examples for each. These models help prioritize tasks, identify bottlenecks, and simplify complex situations. Vicki also discusses counterintuitive models such as inversion, via negativa, and relativity to offer a fresh perspective on problem-solving. By using these frameworks, viewers can think more effectively and make better decisions in both personal and professional life.

Takeaways

• 🧠 Mental models help simplify complexities and offer a different perspective on thinking.
• 📊 The 80/20 rule (Pareto principle) highlights that 80% of results come from 20% of efforts, so prioritization is key.
• 🔧 The theory of constraints emphasizes identifying the bottlenecks in systems to make impactful improvements.
• 🎯 Thinking in first principles involves breaking problems down to fundamental truths and reasoning upwards from them.
• ✂️ Ockham’s razor suggests choosing the simplest explanation with the fewest assumptions in complex situations.
• 🏆 The hawk principle advocates for clear and simple principles to drive complex and intelligent behavior.
• 🎲 Game theory (interest-based counting) focuses on understanding the interests of all players in decision-making beyond just counting competitors.
• ❌ Via negativa emphasizes success through avoiding mistakes or subtracting harmful elements rather than just adding more.
• 🔄 Inversion encourages thinking backwards from goals to identify potential obstacles or solutions creatively.
• 🚀 The difference between velocity and speed is critical—velocity focuses on direction and purpose, not just how fast you go.

Q & A

What is the purpose of the video?

The video aims to introduce viewers to 10 mental models that can help simplify complexities and improve decision-making in various aspects of life.

What is the 80/20 rule, and how can it be applied to daily life?

The 80/20 rule suggests that 80% of your results come from 20% of your efforts. In daily life, you can apply it by identifying the most impactful tasks from your to-do list and focusing on those that bring you closer to your goals.

How does the theory of constraints help in problem-solving?

The theory of constraints identifies the weakest point or bottleneck in a system that limits performance. By addressing this bottleneck, you can significantly improve overall results with minimal effort.

What is the first principles thinking model, and why is it important?

First principles thinking involves breaking down complex problems into their fundamental truths and reasoning from the basics. It helps in avoiding assumptions that can lead us astray and allows for more effective problem-solving.

What is Occam's Razor, and how does it simplify decision-making?

Occam's Razor is the principle that, among competing explanations, the simplest one with the fewest assumptions is more likely to be correct. This helps in simplifying complex decisions by focusing on the most straightforward solutions.

What is the Hawk Principle, and how can it be applied in leadership?

The Hawk Principle states that simple and clear purpose and principles lead to intelligent behavior, while complex rules lead to confusion. In leadership, this can be applied by providing clear guidelines and avoiding unnecessary complexity.

How does game theory, particularly interest-based counting, apply to decision-making?

Interest-based counting in game theory emphasizes focusing on the interests of the players rather than just the number of participants. In decision-making, this helps identify hidden alliances and competing interests that may influence outcomes.

What is the via negativa mental model, and how can it be useful in personal improvement?

Via negativa focuses on what something is not, rather than what it is. In personal improvement, it emphasizes removing negative influences or habits rather than constantly adding new ones, which can lead to more effective progress.

How does the inversion mental model help in problem-solving?

Inversion involves thinking about problems from the opposite direction or starting point. This method can help identify potential obstacles and alternative solutions by approaching challenges from a reversed perspective.

What is the difference between speed and velocity, and why is it important?

Speed refers to how fast you are moving, while velocity refers to how fast you are moving toward a specific goal or direction. Focusing on velocity ensures that you are making meaningful progress toward your desired outcome, rather than just moving quickly without purpose.

Outlines

00:00

🎥 Introduction to Mental Models and Simplifying Complexities

Vicki welcomes her audience, introducing herself and thanking them for participating in the poll. She explains that her channel focuses on mental models and frameworks for clear thinking and communication. In this video, she will cover 10 mental models that can help simplify complexities and improve decision-making. The goal is to make it easier for the audience to apply these models in daily life, and Vicki mentions she will provide deeper dive resources for those interested in further exploration.

05:01

📊 The 80/20 Rule: Prioritizing for Maximum Impact

Vicki introduces the 80/20 Rule, a principle where 80% of results come from 20% of efforts. She emphasizes the importance of prioritizing tasks that yield the highest results, especially when time is limited. Drawing from her management consulting background, she explains how to focus on the most impactful tasks from a to-do list and advises against wasting time on less important activities. She concludes by highlighting the importance of identifying these critical tasks and provides resources for deeper insights.

10:03

🔧 Theory of Constraints: Addressing Bottlenecks

The second mental model discussed is the Theory of Constraints, which focuses on identifying and addressing bottlenecks that hinder progress. Vicki uses her own business experience to illustrate how fixing the bottleneck — such as overcoming fear of talking to customers — can lead to significant results. By identifying and resolving constraints, people can maximize their efforts and achieve 80% of results with just 20% of the work.

🧠 First Principles: Breaking Down Complex Problems

Vicki explains the importance of thinking in first principles, a mental model that involves breaking down complex situations into fundamental truths and assumptions. She notes how successful figures like Elon Musk and Warren Buffet use this method to tackle challenges. By understanding the basic elements of a problem, individuals can build solutions from the ground up. She emphasizes that assumptions often lead people astray, so focusing on the core truths is key to effective problem-solving.

✂️ Occam’s Razor: Simplifying Explanations

Occam’s Razor is the next mental model, which posits that the simplest explanation is usually the most likely to be true. Vicki explains that when faced with multiple explanations, one should prioritize the one with the least assumptions. This model helps people make decisions more efficiently, reinforcing the idea that simplicity is often the hallmark of true understanding. Vicki also encourages viewers to think critically and share their own experiences in the comments.

🧭 The Hawk Principle: Leading with Clarity

The Hawk Principle, originating from the founder of Visa, emphasizes the importance of simple, clear purpose and principles for effective leadership. Vicki contrasts this with the negative impact of overly complex rules and regulations, which can stifle intelligent behavior. She encourages viewers to lead with clarity in both personal and professional settings, and to ensure they can explain their goals simply, as per Einstein’s principle of simplicity equating to understanding.

🎯 Game Theory: Interest-Based Decision Making

Shifting focus to counter-intuitive mental models, Vicki introduces Game Theory and interest-based decision making. She uses a poker game as an analogy to explain how decision-making shifts when players form alliances. Understanding the interests at play, rather than just the number of participants, can lead to more effective strategies. She connects this concept to real-life scenarios such as negotiations and competitions, where hidden interests influence outcomes.

❌ Via Negativa: Focusing on What to Avoid

Via Negativa, a mental model that focuses on what something is not, encourages people to improve by eliminating harmful elements rather than adding new ones. Vicki explains that success can sometimes come from avoiding mistakes or removing obstacles. For example, improving health might involve cutting out unhealthy foods rather than adding superfoods. This principle is about subtracting rather than adding for better results.

🔄 Inversion: Solving Problems by Thinking Backwards

Inversion, or thinking backwards, is a mental model that helps people solve problems by starting from the desired outcome and working in reverse. Vicki discusses how this approach can help uncover obstacles and reveal creative solutions. She also ties this model with Via Negativa, suggesting that listing what you don’t want can clarify what you do want. She references examples like Cirque du Soleil, which innovated by turning the traditional circus experience upside down.

🚀 Relativity: Gaining Perspective from Outside the System

Relativity is a mental model that emphasizes the difficulty of fully understanding a system when you're inside it. Vicki uses the analogy of being on a fast-moving plane to explain how people often don’t perceive their own progress. She advises viewers to consider outside perspectives to gain a fuller understanding of situations and to be open to insights from others, as these may reveal blind spots in their own thinking.

🏃‍♂️ Velocity vs Speed: Moving in the Right Direction

The difference between velocity and speed is a crucial mental model that highlights the importance of moving in the right direction, not just moving quickly. Vicki warns against the pressure to act fast without considering whether you’re making progress toward your goals. Speed without purpose can lead to wasted effort, while velocity focuses on achieving a destination efficiently.

💡 Conclusion: Future Mental Models and Final Thoughts

Vicki wraps up the video by promising to cover more mental models, especially those related to economics and behavioral decision-making in future videos. She invites viewers to engage by liking, subscribing, and sharing their thoughts in the comments. Vicki emphasizes the importance of understanding how humans make irrational decisions and concludes by thanking viewers for watching.

Keywords

💡Mental Models

Mental models are cognitive frameworks that help individuals simplify complex problems and make better decisions. In the video, Vicki introduces mental models as tools for clear thinking and communication. She emphasizes how mental models like the 80/20 rule and the theory of constraints allow people to break down complexities and focus on what truly matters in problem-solving and decision-making.

💡80/20 Rule (Pareto Principle)

The 80/20 rule, or Pareto Principle, suggests that 80% of results come from 20% of efforts. Vicki highlights this rule as a key mental model for prioritizing tasks and focusing on high-impact activities. She uses it to encourage viewers to identify the few tasks that will lead to the majority of their desired outcomes, such as focusing on the most important items in a to-do list.

💡Theory of Constraints

The theory of constraints is a management principle that posits a system's performance is limited by its weakest link, or bottleneck. Vicki explains that identifying and addressing the bottleneck in any process can lead to significant improvements. She uses her own experience in business as an example, where her fear of market validation was the bottleneck holding her back, and overcoming it led to progress.

💡First Principles

Thinking in first principles involves breaking down a problem into its most basic, fundamental truths and building up from there. Vicki explains that this mental model helps avoid assumptions and focuses on core facts, allowing for more innovative solutions. She gives examples of how successful figures like Elon Musk and Jeff Bezos use first principles thinking to drive their decisions.

💡Occam's Razor

Occam's Razor is a problem-solving principle that states the simplest explanation, with the fewest assumptions, is often the best. Vicki uses this mental model to emphasize the value of simplicity in decision-making, encouraging viewers to avoid overcomplicating situations and focus on straightforward, clear solutions.

💡Hock Principle

The Hock Principle, named after the founder of Visa, states that simple and clear principles lead to intelligent behavior, while complex rules lead to confusion and inefficiency. Vicki uses this model to illustrate how organizations, and individuals, can benefit from clear and concise goals, avoiding unnecessary complexity in processes and regulations.

💡Game Theory

Game theory is the study of strategic decision-making where the outcome depends on the actions of others. Vicki introduces this concept by discussing how interests, rather than the number of players, shape the dynamics of decision-making. She uses examples like poker or TV shows like Survivor to explain how understanding the interests at play can give an edge in negotiation and competition.

💡Via Negativa

Via negativa is a Latin term meaning 'by way of negation,' focusing on what something is not. Vicki explains that sometimes progress is made not by adding more but by removing what is unnecessary. She uses examples like removing harmful information or unhealthy food as ways to improve well-being, showing that subtraction can lead to positive results.

💡Inversion

Inversion is a mental model where problems are approached by thinking backward. Instead of thinking about what to do to succeed, one thinks about what to avoid or what could go wrong. Vicki discusses this model as a tool for creative problem-solving and overcoming obstacles by considering alternative perspectives, such as when companies like Cirque du Soleil reinvented the traditional circus experience.

💡Relativity

Relativity in this context refers to understanding that our perception of a system is limited if we are part of it. Vicki draws on the physics concept to explain how people often lack an objective view of their own circumstances. She advises viewers to seek outside perspectives when making decisions to gain a fuller understanding of situations, much like how an external observer can see how fast a plane is moving while passengers cannot.

💡Velocity vs. Speed

Velocity is defined as speed with direction, while speed is simply how fast something is moving. Vicki stresses the importance of focusing on velocity—moving with purpose and toward a goal—rather than just going fast without a clear direction. She uses this model to remind viewers that achieving goals is not just about working harder or faster, but about moving efficiently toward the right objectives.

Highlights

Introduction to mental models and their practical application in simplifying complexities and thinking differently.

Mental model 1: The 80/20 rule – 80% of your results come from 20% of your efforts. Focus on tasks that bring the most results.

Advice on applying the 80/20 rule: Identify the 20% of tasks on your to-do list that will yield 80% of the results to achieve your goals.

Mental model 2: The theory of constraints – systems are only as strong as their weakest part. Focus on fixing bottlenecks for maximum results.

Real-life application of the theory of constraints: The speaker overcame the bottleneck in their business by talking to real users for market validation.

Mental model 3: Thinking in first principles – break down complex situations into fundamental truths and assumptions.

Application of first principles thinking: Understand assumptions vs. fundamental truths to solve complex problems effectively.

Mental model 4: Ockham's razor – the simplest explanation is more likely to be true. Avoid unnecessary assumptions.

Mental model 5: The Dee Hock Principle – simple, clear principles lead to intelligent behavior; complex rules lead to confusion.

Simplifying complexities with these mental models can help anyone who feels stuck in life, providing direction and clarity.

Mental model 6: Game theory and interest-based counting – look beyond the number of competitors to understand the real interests at play.

Mental model 7: Via negativa – sometimes success comes from removing negatives, not just adding positives.

Mental model 8: Inversion – think about problems backward to find creative solutions by considering what you don’t want.

Mental model 9: Relativity – we can’t fully understand systems we are a part of, so it’s important to consider external perspectives.

Mental model 10: Velocity vs. speed – focus on velocity, which is speed toward a goal, rather than just moving fast.

Transcripts

hey everyone welcome back to my channel

i'm vicki

and thank you to all of those who has

participated

in the poll and if you're new here i

share mental models frameworks on clear

thinking and clear communications

so today as you guys have told me we are

going to talk about

mental models and specifically 10 that's

going to give you an edge

in life by one helping you simplify

complexities

and also to help you think different

this video is structured so we go

through the mental model itself and then

we talk about

how you can use it because that was the

most difficult thing for me when i

started was that i didn't know how to

put them together how to apply it to

daily life

so hopefully this video will give you a

good intro as to how you can use

these mental models and i'll point you

to the different

deep dive videos wherever necessary so

you can learn

more about these mental models so first

let's get over

analysis paralysis and get to

simplifying complexities

the first mental model is the 80 20 rule

this is a rule of uneven distribution

where 80

of your results come from only 20 of

your efforts

since everyone has only 24 hours a day

those who can prioritize and focus their

efforts on the right things

will be able to achieve more if you've

been around for a while

you know my management consulting

background this 80 20 rule is

drilled into my head it's the first

filter i apply

to any problems i see how to prioritize

how to structure the problem solving

and so if you're interested in the

details you can check out my

more detailed dedicated video on this

topic but even if

you just know the basics of this uneven

distribution how can you apply it

in life it's really simple take your

to-do list

and identify the 20 of tasks that's

going to give you 80

of the results in terms of getting you

closer to the goal that you want to

achieve

we have a tendency to focus on the easy

things on our to-do list right it feels

good to cross things off quickly

but those things are usually not the

ones that's going to take us closer to

our goals

so while creating some sort of momentum

is important

we also need to look at the 20 of our

efforts

that can give us the maximum amount of

results

now the natural question is but how do i

know

which 20 are going to lead to 80 of the

results

well this leads us to our next mental

model number two

theory of constraints this is another

management principle which states

that the system is only as strong as its

weakest part for the system to succeed

you need to identify the bottleneck

the constraint where the flow is slowed

or stopped

the bottleneck might be small but it has

disproportionate impact

on the system's performance as a whole

and sometimes it only takes 20 percent

of your effort to fix the bottleneck and

get 80

of the results so how can you use this

let me give you an example of when i

first started my business

that i felt really stuck i was doing all

these things but i wasn't seeing results

and i just

didn't know why so how do i figure out

what should i work on the 20

that's going to give me 80 of my results

and one of the question i asked was

what is the one thing that i need to do

but i'm putting it off

where is that bottleneck and for me at

the beginning it was i was too afraid

and didn't want to talk to real users

with the problem i'm trying to solve

i knew i had to get market validation

but i made up all sorts of excuse

to try to get out of it oh you know i'm

in the market i know the market well

i know exactly what people are looking

for and that was holding me back

so instead of spending my day doing the

80 that didn't really give me much

results things like oh i need a

beautiful

and perfect brand guide i need to have a

beautiful website i need to have

the perfect business name i just got

down

there talk to people who had the problem

of not being able to articulate

their business that they didn't have the

message market fit talk to these people

and i had so much feedback that i could

make effective decisions know exactly

where to go with my business

looking for the bottleneck is a great

way to find that 20

that will give you 80 of the impact but

if you want to train and discipline your

brain to think from the fundamental

level then you want to check out the

next

mental model number three thinking in

first

principles i was first introduced to

this principle in law school

talking about logic and legal reasoning

and it was one of those aha moments

where there was life

before thinking in first principles and

then there's life after

put it very simply thinking from first

principles is

when you face a complex situation you

want to break it down

to the fundamental truths and the

assumptions

i've talked about this also in another

video where

i give you examples of how elon musk

thinks about

first principle jeff bezos warren

buffett charlie munger also talk about

this

in one way or another so you can check

out the details here but the important

thing here the key thing to focus on

with first principles is understanding

that there

are fundamental truths and there are

assumptions and the assumptions are

usually what lead us

astray so in order to solve something

that's very complex you want to be able

to understand

the essence of the problem which lies in

the fundamental truths

and then you want to reason up from

there so how do you think in first

principles well charlie munger has a

really easy way of

reminding us is that you look for the no

brainers

since some of you are interested in

business frameworks let's take

one first principle from business which

is profit equals revenue minus

cost so if you want to improve your

profitability

then there are only two things you need

to look at the revenue and the cost

doesn't matter if the industry doesn't

matter the size everything comes back

to these two components now of course

there are intricacies as to you know

where the problem lies

what exactly is the problem and there

are a lot of interdependencies usually

and it's really hard to

break those apart and when that happens

we want to look at the next

mental model number four oh kemp's razor

as albert einstein said there are five

levels of cognitive prowess

at the very bottom is smart then it's

intelligent

brilliant genius and at the very top is

simple and this is exactly what ochem's

razor is trying to underline

that when there are multiple

explanations of a situation

the simplest explanation is more likely

to be true

base your decision making on an

understanding

that has you guessed it the least number

of

assumptions it's all starting to tie

together right and by the way i forgot

to mention this at the very beginning

but these mental models are for how to

think

not what to think so if there's anything

that surprises you anything that you

don't agree with

or if you agree with some of these let

me know in the comments

share with me how you think about

problem solving decision making i'm

fascinated with this topic

so please do share in the comments below

and with that let's get back

to mental model number five the hawk

principle

this comes from the founder and former

ceo

of visa d hawk simple clear purpose

and principles give rise to complex and

intelligent

behavior complex rules and regulations

give rise to simple

and stupid behavior i can't even begin

to tell you

how many times i've experienced this

firsthand the second hand i'm sure

things come to mind when we talk about

stupid complex rules and regulations

organizations that treat people like

kids who don't understand what's going

on

is hurting themselves in the long run

it's really

easy to use the hawk principle in

everyday life

if you are working with others make sure

you lead with simple

clear purpose and principles and with

yourself

hold yourself to a higher standard with

einstein's rule if you can't explain it

simply

you don't understand it now up till now

these five mental models are focused on

simplifying the complex world we live in

today

so if you ever feel stuck not sure which

direction to go

how to break down something massive in

front of you then these five mental

models should give you hints as to

how to get started there are of course

more than five mental models that help

you simplify

the complexities of life so if you're

interested in more let me know in the

comments i can always do another video

on this now i want to shift gears and

look at some counter-intuitive mental

models

they are going to be able to give you an

edge over the masses

as to how you think and see reality

let's kick it off with game theory and

game theory's

interest-based counting imagine you're

at a poker game there's a poker table

there's five people sitting around the

table

you've got chips you've got cars ready

to be dealt so

how many players are there but most

obviously there are five people around

the table so there are five

players right and while that is true

it misses a really crucial point in

decision making

which is the interests at hand let's say

two players decided

to form an alliance and they will share

the winnings and the losses

then the way that they play this game

would be very different from if five

players were just playing for theirs

themselves and how you judge

what is going on will be distorted if

there are two people playing for the

same

interest but you weren't expecting it or

if you think about the house

right they also have an opposing

interest to your own

so how many players are there it's a lot

more complicated

than just the number of people sitting

on the table so how do you use this

in real life well every time that you

are negotiating

you are maybe looking for a promotion

you're maybe competing against others in

a game in a competition of some sort by

thinking in terms of interest rather

than just

the number of competitors that exist it

really gives you a fuller understanding

of what is really going on

i think survivor the tv show is a really

good example of this

where alliances always shift because the

interests

are always shifting and so by seeing the

opposing interests at play you can make

better decisions and prioritize what you

need to do next

now following this line of thinking

thinking about things

beyond the obvious number seven the

mental model

is via negativa it's a latin word for

focusing on what something is not i

think most of us have heard at least a

version

of this advice from successful people

which is in order to succeed

avoid doing something stupid it's quite

intuitive for us

when something is not working to think

okay what can i do

differently what can i add into my life

so that i can be better at

x y and z even though we think we need

to add more in order to do better

sometime

it makes sense to subtract for example

sometimes it's not about the information

that you do consume but rather the

information

that you don't consume same thing with

food to improve health

sometimes it's not about how much

more superfoods you can stack into your

meal but rather what can you take away

that will give you better results again

not giving health advice

but just highlighting the perspective of

focusing not just on additions but

subtraction as well

and while we are on this topic of

focusing on what something is not

let's talk about mental model number

eight which is inversion

now most of us are trained to think in a

linear fashion right think from the

beginning

and go to the end but sometimes it

really helps to think through problems

backwards instead of just forward now

this this

is a powerful tool for flexible thinking

for being creative and when you invert

which is turning something upside down

you're upending things

this is where you see the obstacles and

you see creative ways of getting around

them

i actually talked about this in detail

just in the last video here

so you can go in and see examples like

cirque du soleil of how they

recreated the circus experience by

turning things literally upside down or

combine it with

via negativa right list out all the

things that you don't want

in order to see what exactly it is that

you do want

and if you do feel stuck know that it's

actually normal because

in the next mental model relativity from

physics

the idea is that we can't fully

understand a system that we are a part

of

a simple illustration if you're on

applying you don't feel like you're

moving at

900 kilometers an hour because you are

moving at the same speed as the plane

but an observer can see how fast the

plane is moving

because they are not part of that system

and this is really easily applied to

everyday life

there are so many moments where we

cannot see the full

fuller picture so don't be too quick to

write off different perspectives

when people say something don't agree

with that's actually where the gold lies

it's a blind spot so to speak in your

understanding

of the world and what they say could

help you

improve your understanding and while

we're talking about airplane and speed

i want to mention the next mental model

velocity

versus speed our societies love to

glorify

going fast but sometimes we confuse

speed with velocity speed is how fast

you go

and velocity is how fast you go to get

somewhere

and that makes a huge difference you can

move backwards

really fast but that doesn't help you

get to where you want to go

so whenever you feel pressure to go

faster remind yourself

velocity versus speed where are you

really trying to go

this video is getting really long so i

will do another video to this

focus more around mental models in

economics

and in behavioral economics specifically

of how we make decisions

based on monetary incentives also talk

about

human misjudgment human irrationality

so if you're interested in that then

stay tuned if you've

learned anything new in this video

please give it a big thumbs up

subscribe if you haven't already leave

comments down below and let me know

anything surprising anything you agree

with disagree with

and i will see you in the next video

thanks for watching

bye