5 Mental Models to Think Like a Strategic Genius
Summary
TLDRThe video emphasizes the importance of strategic thinking and decision-making in achieving success, using lessons from competitive chess as metaphors. It introduces five mental models: controlling the center, understanding the true value of a piece, position before submission, owning the initiative, and the art of tactical retreat. These models are applied to both personal and business scenarios, illustrating how strategic thinking can lead to better outcomes and improved judgment.
Takeaways
- π§ The importance of good judgment in decision-making and its impact on success or failure in life.
- π The realization that most people are not taught how to make good decisions and often rely on emotions rather than logic.
- π The introduction of mental models as a tool for strategic thinking to improve judgment and decision-making.
- π€Ή The application of mental models from competitive chess to various aspects of life and business.
- π The first strategic thinking framework: 'Control the Center', emphasizing the importance of focusing on the most influential areas.
- π Examples from life and business illustrating how to identify and apply the 'center' of a situation to maximize impact.
- π The second framework: understanding the true value of a piece (or person) relative to its position and dynamics of the situation.
- π The concept of 'Position Before Submission', highlighting the importance of strategic positioning over immediate victory.
- π The third framework: 'Owning the Initiative', which is about dictating the pace and direction of actions for momentum and success.
- π The idea that maintaining momentum is easier than gaining it initially, and its implications on long-term success.
- π The fourth framework: 'The Hardest Move to Find', which is about recognizing and executing the strategic retreat when necessary to ultimately move forward.
Q & A
What does Nval Rant emphasize as a key factor in determining success or failure in the modern age?
-Nval Rant emphasizes that judgment, not work, determines success or failure in the modern age. He believes that making good decisions is crucial, and this involves thinking clearly, strategically, and applying efforts towards high leverage opportunities.
How does Nval Rant describe the concept of 'mental models'?
-Nval Rant describes mental models as pre-designed frameworks that can be used to make strategic decisions. These models help systematize the process of developing good judgment by plugging in different variables to produce an answer.
What is the first strategic thinking framework that Nval Rant discusses in the transcript?
-The first strategic thinking framework discussed by Nval Rant is 'control the center'. It is a fundamental rule in high-level chess where controlling the four central squares on the board provides a massive advantage, as pieces have maximum influence from there.
How does the concept of 'control the center' apply to personal life and business?
-In personal life and business, 'control the center' applies by identifying the most influential points or areas that can create the most impact. For example, in weight loss, focusing on nutrition and exercise (burning more calories or consuming fewer calories) is more effective than other options. In business, controlling key areas like marketing, operations, and finance can lead to success.
What is the importance of understanding the true value of a chess piece according to Nval Rant?
-Understanding the true value of a chess piece is important because a piece's worth is relative to the board dynamics. A piece's value can change based on its position and influence on the board. This concept can be applied to business and personal life by recognizing that the value of people or resources depends on their capabilities and where they are utilized.
How does the 'position before submission' framework influence decision-making?
-The 'position before submission' framework suggests that focusing on controlling the position is more important than immediately seeking a win or submission. It emphasizes the importance of strategic positioning and creating a favorable setup that naturally leads to success, rather than chasing quick solutions or hacks.
What does Nval Rant mean by 'owning the initiative'?
-'Owning the initiative' refers to dictating the action and being the one to act rather than react. It's about having momentum and driving progress in a direction that leads to success. This mental model suggests that maintaining momentum and proactively shaping the course of action can often lead to better outcomes than reacting to circumstances.
Why does Nval Rant consider the 'hardest move to find' as a valuable strategic thinking framework?
-The 'hardest move to find' is valuable because it represents the counterintuitive strategy of tactical retreats. It's about recognizing when moving backwards or taking a step back can actually lead to faster progress towards a goal. This framework encourages considering moves that might seem wrong or counterproductive at first glance, as they can sometimes be the most effective.
How did Nval Rant apply the concept of 'tactical retreat' in his own business experience?
-Nval Rant applied the concept of 'tactical retreat' by firing a difficult customer who accounted for a significant portion of his business's revenue. Although this decision initially led to a drop in revenue, it freed up resources and allowed the team to focus on other customers, ultimately leading to a significant increase in overall revenue.
What is the main lesson Nval Rant wants viewers to take away from the discussion on strategic thinking frameworks?
-The main lesson Nval Rant wants viewers to take away is the importance of strategic thinking in both personal and professional life. By using mental models like 'control the center', 'position before submission', 'owning the initiative', and 'the hardest move to find', individuals can make better decisions, improve their judgment, and ultimately achieve greater success.
What resources does Nval Rant recommend for further exploration of the concepts discussed in the transcript?
-Nval Rant recommends the book 'Who Not How' by Benjamin Hardy and Dan Sullivan for deeper understanding of strategic thinking. He also refers to his own 'Hyperfocused Entrepreneur Newsletter' for additional insights on business, investing, and self-mastery concepts.
Outlines
π§ Developing Good Judgment Through Mental Models
This paragraph discusses the importance of good judgment in determining success or failure. The speaker shares their personal experience of working hard in their 20s but making poor decisions due to lack of good judgment, leading to debt and less-than-ideal outcomes. They introduce the concept of mental models as pre-designed frameworks to help make better decisions and share their journey of applying these models from competitive chess to improve their strategic thinking in life and business. The speaker outlines their intention to share five mental models from chess that can enhance strategic thinking.
π― Control the Center for Strategic Advantage
The speaker delves into the first mental model, 'control the center', drawing parallels from chess where controlling the middle of the board grants significant advantage. They explain that strategic positioning is crucial in both life and business, using the example of weight loss where focusing on nutrition and exercise can be more impactful than other methods. In business, they emphasize the importance of focusing on key areas such as marketing, operations, and finance, depending on the stage of the business, to gain a strategic edge.
π Understanding the True Value of Resources
In this section, the speaker discusses the second mental model, which is understanding the true value of resources or 'pieces' in the game of chess. They explain that while all pieces have different base values, their true worth is determined by their position and influence on the board. This concept is applied to business by highlighting the importance of placing the right people in the right roles to maximize their potential. The speaker also suggests looking for help outside one's capabilities, using the example of seeking a nutritionist's advice for weight loss, and recommends the book 'Who Not How' for deeper insights.
π₯ Position Before Submission: A Strategic Approach
The third mental model presented is 'position before submission', where the speaker explains that in chess, as well as in life and business, focusing on controlling the position before seeking a 'checkmate' or a win is crucial. They contrast the approach of beginners who seek quick wins with that of experienced players who understand the value of a dominant position leading to natural victories. The speaker advocates for a similar strategy in life, emphasizing the importance of setting up one's environment to naturally progress towards goals, and warns against the fallacy of seeking easy shortcuts to success.
π Owning the Initiative: The Secret to Momentum
The speaker introduces the concept of 'owning the initiative' as the secret to gaining momentum, which is described as a powerful force against procrastination and inaction. They explain that momentum is like a universal law where an object in motion tends to stay in motion, and that gaining this momentum can be challenging due to the high activation energy required to get started. The speaker contrasts the maintenance energy required for a job with the potential for decreasing maintenance energy in a well-built business, leading to passive or leveraged income. They encourage viewers to consider the often-overlooked moves that may be the fastest path to progress.
π The Hardest Move: The Tactical Retreat
In the final mental model, the speaker discusses the difficulty of recognizing and executing a tactical retreat, which involves stepping back to move forward more effectively. They share a personal story of firing a problematic customer, which initially led to a significant revenue drop but eventually allowed the team to focus on other customers, resulting in a much larger revenue increase. The speaker emphasizes the importance of considering unconventional moves and the potential benefits of retreating to gain a better position for future success.
Mindmap
Keywords
π‘Judgment
π‘Mental Models
π‘Control the Center
π‘High Ground
π‘Strategic Thinking
π‘Position Before Submission
π‘Initiative
π‘Activation Energy
π‘Tactical Retreat
π‘Leverage
π‘Chess
Highlights
In an age of infinite leverage, judgment rather than work determines success or failure and what is good.
Good judgment involves thinking clearly, strategically, and making good decisions.
Many people were not taught how to make good decisions, leading to choices based on emotions justified with logic.
The speaker developed better decision-making by using mental models for strategic thinking.
Mental models are pre-designed frameworks to help make strategic decisions.
The speaker discovered strategic frameworks from years of playing competitive chess.
The first strategic thinking framework is to control the center, a fundamental rule in high-level chess.
Controlling the center of the board provides maximum influence for your pieces.
In life, identifying the most influential 'squares' or areas can lead to more effective decision-making.
In business, controlling key areas like marketing, operations, and finance is crucial.
The value of chess pieces is relative to the board dynamics and their positioning.
In business, the value of people depends on their capabilities and where they are placed within the organization.
Strategic thinking involves focusing on position before submission in chess and life.
The concept of environment design helps create conditions that naturally lead towards achieving goals.
Initiative in chess and life refers to dictating the action, which often leads to momentum and success.
Momentum is a powerful force that can overcome procrastination and maintain progress with less effort.
Understanding the difference between activation energy (to get started) and maintenance energy (to sustain progress) is key in decision-making.
Sometimes taking a step back or a tactical retreat can be the fastest way to move forward.
The hardest move to find in chess and life is often the night retreat, which involves moving away from immediate goals for long-term progress.
Transcripts
nval rant said in an age of infinite
leverage judgment not work determines
success or failure and what is good
judgment if not the ability to think
clearly and strategically and then make
good decisions now I think about this a
lot in my own life because it's just
been so damn true see throughout my 20s
I busted my ass I worked really hard but
because I had poor judgment I made bad
decisions and I applied my efforts
towards low leverage opportunities all
that I had to show for that work was
$80,000 of debt and a 13 passenger van
parked in Downtown Oakland that I got to
call home now the problem for most of us
is that we never really taught how to
make good decisions so as a result we
tend to make decisions based on emotions
and then justify them with logic and
that's probably not going to get you
very far in life at least it didn't for
me but here's what did I started using
mental models for thinking more
strategically now a mental model is
nothing more than a pre-designed
framework that you can pull out whenever
a situation requires a decision you just
plug in the different variables and out
pops an answer and voila just like that
you systematized a process of developing
good judgment now as I started looking
around my life for mental models that I
could steal I realized that I was
sitting on a treasure Trove of strategic
Frameworks that I developed over years
of playing competitive chess and once I
started regularly tapping into these
Frameworks the quality of my decisions
and ultimately my results those started
to improve as well so in this video I'm
going to break down how to become a more
strategic thinker in business and in
life through five mental models I
learned from playing
chess so let's dive into our first
framework of strategic thinking it is
control the center this is perhaps one
of the most fundamental rules of highle
chess the player controlling the four
squares in the middle of the board has a
massive Advantage because from here your
pieces have maximum influence across the
battlefield just think of it like The
High Ground the reason The High Ground
is so important is because it gives you
more reach without necessarily exposing
yourself to more risk Anakin Skywalker
had to learn this the hard way so let's
take a lesson from his book all right so
let's illustrate this point to really
drive it home imagine a knight
positioned in one of the four key
squares in the center of a chessboard
from here it exerts influence on eight
different squares but if you take that
same Knight and you put it into the
corner for example Now it only
influences two squares and the same can
be said for the Bishop from the center
of the board they control 13 squares
whereas from the corner they only
control seven okay so the question to
ask yourself when using this Frame to
make a decision is this where is the
center of the board and what do I need
to do to get pieces there so that they
have maximum influence so let's break
this down into two examples one from The
Game of Life and one from the game of
business to show how you might think
through this in real time okay so first
in the game of life let's say you're
trying to lose 15 lbs the Strategic Way
To Think through this is to identify
those few squares on the board that are
going to give you the most influence now
when it comes to losing weight you got
all sorts of options you could could go
on a diet you could work out more you
could focus on getting better sleep or
go on a fast you could take a dieting
pill get lipos Section like there's
thousands of squares on the board but
which is at the center well when you
really boil it down to its essent weight
loss comes down to two things either you
burn more calories or you consume fewer
calories if you do that you're going to
lose weight but let's say you're a busy
bee and you can only commit to one of
these two options which is the better
Square exercise or nutrition so
thankfully the science on this is pretty
clear you can't out work your mouth for
example one Butterfinger is 275 calories
and to burn an equivalent to mount you'd
have to go for a 2 and 1/2 Mile Run good
luck exercise alone ain't going to get
you there then again good nutrition can
practically win the game on its own so
the correct strategic decision if you
can only choose one is to focus on your
nutrition all right so now let's apply
this framework to your business by
asking where is the center of your board
now as I see it there's three key
squares to control inside of a business
you have marketing that is how are you
getting customers you have operations
which is what is the actual product and
how do you deliver it to your customers
and then you have Finance which is how
do you manage the bank accounts to make
sure you don't run out of money while
you do number one and number two if
you're just starting out and you have
limited resources you'll probably not be
able to focus on all three squares
simultaneously which means you'll have
to decide which is the priority at any
given moment now if you don't have a
product to sell don't worry about
finance and marketing if you have a
product but no customers well then Focus
there in the beginning of every business
you the founder are literally every
piece on the board and unfortunately you
can't be everywhere all at once but
hopefully this framework of controlling
the center it gives you a useful frame
for Discerning where your focus should
be at any given moment until you can get
to that point where you can start hiring
other people to control squares on the
board for you and once you get to that
point it's time to master the next
framework which is to understand the
true value of a piece one of the first
things you learn in chess is that all
pieces have a different Value Pawns are
worth like a point Knights are usually
usually worth three points Bishops are
three to three and 1/2 points Rooks are
worth five the queen is worth nine and
the king is priceless because if you
lose him you lose the game now this is
just a quick easy way to calculate who
has the stronger Army at any given
moment for instance you could trade a
knight and a bishop which together are
worth about six points for a rook and a
pawn which are also worth about six
points or you could trade two Rooks for
a queen and a pawn all of which are
combined worth about 10 points all right
so this is a good starting point but
it's just the beginning because a
piece's true worth is actually relative
to something called board Dynamics again
think back to controlling the center a
knight in the center of the board has
more reach and influence and therefore
is more valuable than a knight in the
corner now one of the best examples I've
ever seen of this was in the 1985 World
Championship Match when Gary caspero
showed us that a single Knight if
positioned correctly can dominate a
queen and two Rooks simultaneously that
legendary little horsey was done the
octopus night and he lives on and infamy
to this very day at least amongst a very
small cabal of chest nerds like myself
so here's how to use this Frame to think
strategically inside of your business
the value of your people is dependent on
what they're capable of and where you
put them on the board Jim Collins
famously expressed this as getting the
right people on the bus into the right
seats and when you do this it's amazing
how much easier the game actually gets
but this doesn't just apply to business
this Frame can also work in your
personal life for example if you're
struggling with a problem let's say
weight loss the question we often ask is
how should I solve this but perhaps the
better question is who do I know that
could help me solve this maybe your best
friend's brother is a nutritionist and
you could reach out for guidance and
accountability Boom the problem just
became that much easier to solve now a
really great resource if you want to go
deeper on this topic is the book named
who not how by Benjamin Hardy and Dan
Sullivan highly recommend you you check
that out all right let's move on to the
third frame for thinking through
problems strategically this one is
called position before submission so in
chess there's a few different ways to
determine who's winning at any given
moment the most obvious way is you count
the pieces generally Whoever has the
more powerful Army has the advantage but
not always because like we just learned
in the previous two frames a smaller
Army occupying better terrain can hold
off a vastly superior force and we've
seen this multiple times throughout
history like really classic example is
the story of the 300 Spartans holding
back the Persian Empire at the Battle of
thermopolymerization
trying to submit one another one of the
biggest differences I noticed almost
immediately is that when you wrestle
with lower belts like a white belt or a
blue belt they're constantly looking for
the submission and you see the same
tendency when people first learn boxing
or M thae they're constantly looking for
that one punch kill shot that's going to
end the match instantly it doesn't
matter where these people are in the
position they're just throwing Haymakers
praying something lands if you compare
this to the more skilled Fighters the
black belts for example you you notice a
very very different strategy the upper
belts pretty much only ever go for
submissions after they've thoroughly
dominated the position they get to a
dominant position sitting on your chest
you got your arms spread over your head
all willy-nilly and then they finally
reach down and choke you out with
practically no effort the same thing
happens in chess in business and in life
new players fixate on attacking the
opponent's king at all costs and in the
process of hunting that Checkmate they
compromise their position Advanced
players understand that if you control
the position first the submissions will
naturally appear now I get it it's human
nature to want the easy solution that
one shot kill which is why trillions of
dollars are poured into Miracle fat loss
pills getrich quick schemes on YouTube
in the lottery somehow we think that if
we can just find that one little hack
everything in our life will fall into
place now I hate to be the bearer of bad
news but there is no hack not only that
but spending all your time looking for
one is what's keeping you from doing the
laborious work of controlling the
position that would if you give it
enough time lead to success so the
question to ask in all domains of your
life and business is what's it mean to
control the position here for me I like
to think a lot about the concept of
enironment design which is all about
setting up your life in such a way that
it creates a slippery slope towards your
goals now I unpacked this concept in
Greater detail in the video called how
to unfuck your life which I'll put a
link for down in the description but
before you check that out let's move on
on to our fourth mental frame for
thinking strategically in spoiler alert
this one is by far my favorite cuz it's
the one people think about the least I
call it owning the initiative all right
so we've already discussed two ways of
determining who has the advantage in a
game of chess You Can Count pieces to
figure out who has the more powerful
army or you can look at who's
controlling the position and these are
fairly straightforward and easy to
determine which is why most people
default to using them but there's
another way a top secret way that grand
Masters use to evaluate a position and
in my experience as the nth grade South
Dakota State chess champion this
Advantage is typically the one that
decides the game it's called the
initiative and it's determined by which
player is dictating the action that is
which player is acting and which is
reacting if you can answer that question
then you can reliably predict with a
high degree of certainty which player is
ultimately going to arise Victorious now
the classic example of this in my mind
is Napoleon who always just seemed to
have the initiative he dictated where
where when and how the action would
unfold and as a result despite often
having vastly inferior forces he still
managed to win time and time again in
business and in life a lack of skills or
experiences can often be overcome with
the appropriate amount of Gusto and the
reason for this is because the
initiative leads to momentum and
momentum is one hell of a thing it is
the cure to procrastination to overwhelm
to overthinking and more importantly
it's often The X Factor of success the
reason it tends to be so powerful is
because it Taps into a fundamental law
of the universe which is an object in
motion tends to stay in motion but
here's the problem and it's the reason
most of a struggle the reverse is also
true an object at rest tends to stay at
rest and if you've ever found yourself
feeling stuck in the mud of life like
you just can't get traction can't get
moving forward it's not your fault
getting momentum is the hardest part
because it requires an outsized amount
of what's called activation energy once
you've inserted that into the system the
energy required to suain sustain
progress substantially decreases I call
this maintenance energy and it's the
reason why it's easier to maintain your
current trajectory in life than it is to
change paths okay so the way we can use
this mental frame in the context of
thinking strategically is to understand
that when we're comparing two courses of
action often we'll overvalue the amount
of activation energy required to get
traction and undervalue the amount of
Maintenance energy required to sustain
for instance getting a W2 job requires
far less activation energy than starting
your own business however the day you
stop injecting maintenance energy into
your job is the day you stop getting
paid so you're going to have to pay this
cost of Maintenance energy into
perpetuity whereas in business if you
build it correctly the amount of
Maintenance energy that you'll
personally have to inject in the machine
is going to gradually decrease over time
and potentially even get to the point of
requiring zero energy from you and this
is when you're finally playing in the
arena of passive income or what what I
prefer to call leveraged income but
that's a different conversation entirely
if you want to learn more about
leveraged income I'll drop a video for
that down below but before you go check
that out I want to share with you one
more frame for thinking strategically
and this one is quite important because
it is as the name implies the hardest
move to find one of the greatest players
to never win a World Chess Championship
with a guy you probably never heard of
named vassel even chuk I think a lot
about this guy because he said something
that's stuck with me over the years he
said the hardest move to find is a night
Retreat which in my experience is true
but the question I always come back to
is why is it so hard to find well
there's really two reasons first
tactical retreats in games and in life
are always hard to see because we often
equate forward motion with progress if
we're not moving directly towards a goal
it can often feel like a waste of time
and energy now the second reason that a
night Retreat is so hard to find is the
result of the fact that the Knight
itself moves in a completely different
way than any other piece on the board
and particular there's one aspect of the
night's peculiar movement pattern that
can really screw with your mind that is
it can jump over other pieces when we
combine these two things we now have a
piece that moves in a very strange way
away from our goals as a result most
people never stop to even consider these
moves but the truth is sometimes taking
a step back is in fact the fastest way
to move forward for instance what of my
businesses back in 2018 was hyper
focused on growth we had poured a ton of
money into infrastructure and machines
for producing our products now we have
to drive a lot of Revenue to cover those
expenses now at that time we had one
massive customer in particular who
accounted for nearly 10% of our yearly
Revenue as you can imagine we were
terrified of losing this customer so we
would do pretty much anything and
everything to keep them happy the
problem was they were impossible to make
happy they called me at all hours of the
night they sent dozens of stressful
emails every single day to our shipping
manager and it got to the point that my
team and I were spending more time
dealing with them than we were with all
of our other customers combined
eventually we got to the point where we
finally saw the one move we've been
overlooking the entire time the Tactical
Retreat that is we fired that customer
and overnight our Revenue plummeted by
10% at a time when we really needed that
money but the result of that retreat was
that it freed up so much of my team's
time and mental bandwidth that we can
now pour into the other 90% of our
customers which led to a massive spike
in Revenue that far surpassed the % we'd
given up only a few months prior now the
moral of the story is that sometimes
taking a step back is in fact the
fastest and in many case the only way to
move forward so the question I like to
ask myself is what is the move that I'm
not even considering right now because
it just looks so wrong maybe that's
quitting your job maybe it's moving to
another city maybe it's ending a
relationship that no longer serves you
regardless of what it is answering that
question is often the key to finding the
winning move yo what's up guys thanks
for watching hopefully you enjoyed the
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