itor From the Editor From the Editor From the Editor From the Editor From the Ed

OPE

Daniel Kahneman blew my mind . And much of the world ’ s , actually . His book “ Thinking ,

Fast And Slow ” ( 2011 ) was an international best seller and an influential book in my adult life . In it , Kahneman presents many of his ideas that form today ’ s “ behavioral economics .”

Kahneman ’ s revolutionary ideas earned him the Nobel Prize in Economics ( 2002 ), and they apply to our everyday lives of buying , selling , and communicating with customers , clients , and coworkers . Kahneman died recently at the age of 90 , and I ’ ve been rereading his amazing work .

His writing on the Illusion of Validity hit me recently as I was reading financial reporting from some of our industry ’ s big corporations . In these financial filings , companies like Stihl and Caterpillar publish a bunch of data about sales and profits over a period of time . Then they often close with their “ Outlook ”

GLENN HANSEN for the coming quarter or the year ahead . Predictions , basically .

Kahneman writes , “ Those who know more forecast very slightly better than those who know less . But those with the most knowledge are often less reliable .” ( I added the emphasis .)

“ The reason is that the person who acquires more knowledge develops an enhanced illusion of her skill and becomes unrealistically overconfident .” What ’ s worse , we are often unlikely to admit our errors , he adds , or we assign excuses to them and that prevents us from adjusting our thinking .

This fits in the larger picture of behavioral economics and Kahneman ’ s well-thought theories stating that humans are not rational . And the science of economics is as much about psychology and sociology as it is mathematics , maybe more .

Want proof ? Look at last year ’ s recession , yes , the one that never happened even though countless smart people predicted one . And then they rationalized the correct and current outcome without ever admitting they were wrong . Kahneman gives two reasons for this . One , the world is unpredictable . Two , “ high subjective confidence is not to be trusted as an indicator of accuracy ( low confidence could be more informative ),” he writes .

I think of this now as we increasingly rely on and publish data from very smart people . Financial reports and sales data and surveys of dealers and users . All that rational analysis can increase our “ subjective confidence .” And this type of knowledge can be a good predictor for short-term trends , said Kahneman . But don ’ t expect much , he wrote , from pundits making long-term forecasts .

There is more to thinking and predicting than rational scientific data , a whole lot more . Read Kahneman ’ s book and be ready to take notes . It ’ s kinda nerdy , and I dig that .

BUSINESS STAFF Sr . Vice President / Sales Content Director

Associate Publisher / Editorial Brand Director

Assistant Editor Associate Art Director Contributing Writers :

David Voll Glenn Hansen

John Kmitta Robert Augsdorfer Lindsay Zigan

Cole Jackson Chris Picciano

ACCOUNT REPRESENTATIVES Edwin Rosario Marketing & Engagement Sales Executive Phone : ( 763 ) 383-4495 erosario @ epgacceleration . com

Roberto Almenar Sales Executive Phone : ( 763 ) 383-4494 ralmenar @ epgacceleration . com

AD MATERIAL & QUESTIONS ads @ epgacceleration . com

DIRECT MAIL LIST SALES Kris Grauer NPS Media Group kgrauer @ npsmediagroup . com ( 203 ) 822-7933

REPRINT SERVICE For more information on e-prints or reprints from OPE Plus , visit epgbrandacceleration . com / marketingservices and contact us today or email us at info @ epgacceleration . com

EDITORIAL OFFICES EPG Media & Specialty Information 7760 France Avenue South , Suite 810 Bloomington , MN 55435 Phone : ( 763 ) 383-4400

CIRCULATION For subscription inquiries and customer service questions , please call 763-383-4492 or email customerservice @ epgacceleration . com

Publisher ’ s Notice : We assume no responsibility for the validity of advertising claims in connection with items appearing in OPE Plus . Commercial product names are used for the convenience of the reader . Mention of a commercial product does not imply endorsement by OPE Plus or EPG Brand Acceleration , or preference over similar products not mentioned .

BRAND ACCELERATION

4 OPE + May 2024 www . OPE-Plus . com