Sunday, September 17, 2017

New Book Attempts To Bring Economics And Literature Together

Adam Smith did not believe people are merely economic maximizers. Instead, we balance self-interest with humane sympathy for others. Deirdre N. McCloskey reviews ‘Cents and Sensibility’ by Gary Saul Morson and Morton Schapiro.

See Economics With a Human Face from The WSJ. Excerpts:
"economics—a hugely influential approach to studying human societies—isn’t worth all that much without first understanding what it means to be human.

Mr. Morson is a professor of Slavic literature at Northwestern University, and Mr. Schapiro teaches economics there"

"Economics, they argue, has been stripped down to a theory neglecting language and culture. At the same time, literary study has abandoned its responsibility to lead students to the best that has been thought and said. The humanities, Messrs. Morson and Schapiro contend, should acknowledge economics for worldly purposes. Yet for a truly human science the economists need literature, philosophy and history. Each discipline can supply what the other lacks."

"The real Smith observes that human beings summon qualities of sympathy balanced with their self-interest. People are not merely economic maximizers: They are ethical creatures from the get-go."

"Messrs. Morson and Schapiro advocate a fusion the economist Bart Wilson and the Nobelist Vernon Smith have recently dubbed “humanomics.” The humanities study categories, and the initial step of categorization is essential to any human inquiry."

"You can’t measure gross domestic product or unemployment without first saying what they are, qualitatively, as categories of interest to humans."

"There is no God-term telling us from the outside what categories humans care about. Economics, physics, biology, history—all need the first, humanistic, categorizing step."

Thursday, August 10, 2017

Is Storytelling Important For The Economy?

"It's the economy, stupid"-James Carville, strategist for Bill Clinton in the 1992 presidential campaign

"The human mind is a story processor, not a logic processor."-from the book The Righteous Mind: Why Good People Are Divided by Politics and Religion by social psychologist Jonathan Haidt.

Wouldn't it be great if there was a blog that looked at the intersection of the economy and storytelling or mythology? Well, there is! See Dollars and Dragons.

Here is one example of how storytelling and economics come together. See Giving Your Brand Primal Power Through Storytelling by Nick Nanton & JW Dicks. Excerpt:

"At our agency, we make what we call “story-selling” an essential component of our branding efforts with our clients. We’ve seen firsthand that, when you create the proper story, you’ve done most of the heavy lifting required to build a successful brand.

The question, though, is why--why do stories have such “primal power” when it comes to influencing an audience?

It turns out there’s a perfectly good scientific explanation: Stories affect us on both on an incredibly deep intellectual and emotional level that we are just beginning to understand.

That quest began when scientists discovered that fictional stories affected the same region of the brain that reacts when we ourselves are engaged in real-life drama. Stories create a bonding empathy which causes us to strongly identify with the made-up protagonist, as if we were, in fact, that person. In other words, stories have such impact because our brains actually get a little mixed up as to what’s real and what’s not."
There is also a great book out there called The Storytelling Animal: How Stories Make Us Human by Jonathan Gottschall. Here is the review I wrote at Amazon:

"If you liked "The Moral Molecule" by Paul Zak, "The Righteous Mind" by Jonathan Haidt or "The Power of Myth" by Joseph Campbell, you will probably like this book, too. It would be worthwhile if only for the anecdotes. The explanation about how a scientist proved that cats dream. Or that going to an opera greatly influenced Hitler. You want to keep reading. You never grow tired of it. How stories are a deeply inherent part of our nature is entertainingly explored. Stories affect business and economics because CEOs and brands need to tell a story. The role that evolution played in making stories important is explained. His theories and conclusions are supported by science. But it is still enjoyable. Gottschall himself is a good story teller. I love the line about stories being the flight simulators for life. The moral and socials role of stories are also explored. But stories are personal, too. We each have a story we tell ourselves. As Jung said, we should all try to discover what myth we are living by. Books like this should help us out on that quest."
A related post is Economists Love Fables And Parables (Or, What Is The Essence Of Economic Analysis?)

Wednesday, August 9, 2017

Mike Wittenstein on Storytelling and branding

How to Dramatically Improve Your Personal Branding from a Master Storyteller. From The Freelancer Community Magazine.

"One of the most important things to get right as a Freelancer is to establish a personal brand.
Not everyone can devote a ton of time fumbling through strategies on personal branding. Especially when your time is spent doing the technical work at hand.

Luckily, there are simple and clear ways to help improve every blogpost to better market and sell the product and services you offer.

In our social media age with Facebook, Twitter, Instagram, LinkedIn and even SnapChat, big brands are leveraging these channels to tell their stories and to engage with their audiences to increase impressions.

One of the great things about the time we live in is that the medium that big brands like General Mills or publications like Vice Media are also available to Freelancers like us.

I believe that’s the primary reason why Freelancing, Digital Nomads and Independent Contractors are able to live remotely and still run their businesses no matter where they are.

In this great levelling between big budget marketing departments and the Solopreneur who would have the same reach and influence using social media and a personally set up website, it matters less about the medium and way more about what you say and don’t say.

And it goes without saying that “content is truly king”.  What you say, how you say it, how you tell your story is what makes a difference in affecting an emotion in your clients and prospects.

We Are Creatures Craving Stories

One of the the leaders and influencers in this space has been Storyminers, founded by Michael Wittenstein.  Mike’s core worldview is that the art and science of storytelling can massively support business owners and executives in telling their companies’ stories.  The stories that are uncovered through discovery serve as the identify of their business and translate down to the customers’ experience and the interaction with the brand, products and services.  At the end of the day, no matter how much money you have in your marketing budget, no matter who is your superior in your corporate hierarchy, the customer should be your ‘north star’.

This is what Mike and Storyminers does well:
“Mike Wittenstein advises leaders on how changes to their customer experiences can positively transform their brand narratives and their bottom lines. He is the managing partner at Storyminers, a design pioneer and developer of unique methods and tools for enhancing front-line customer experiences—and the only individual to hold top earned designations as a consultant (CMC), speaker (CSP), and customer experience expert (CCXP).”

In this in-depth interview with Mike, we asked him what the top Freelancers, Digital Nomads and Solopreneurs are doing and how they should be telling their story in order to maximum their efforts in personal branding.

Question 1: In your experience with supporting SMBs, Solopreneurs and Freelancers to come up with a better story and value proposition for their business, what would you say people most overlook during this process?

The most important thing to remember when sharing your story is to tell it from your future customer’s perspective. The value of your company and your personal abilities will connect more if it starts with the problems, struggles, hopes, and details of your future client’s situation.

For example, instead of saying “OUR Company offers the best website design around.”, consider “If you’re looking for a group with superpower listening skills that can turn what you say into a website that will turn heads, call OUR Company.” Can you feel the difference? Before saying that you’re good, explain the value you offer and how you’re good.

Question 2: Digital Nomads are fast becoming part of this “gig economy” and “sharing economy”. In this world where there are more people working for themselves, do you think using “story” is ever more important? If so, why?

Your story is what distinguishes you from all the other digital nomads. It doesn’t have to be the loudest, the prettiest, or the most provocative. But, it does have to be yours and you have to own it. Your story should feel natural and authentic to you. If it does, it will connect faster with your future clients.

Stories are better than traditional marketing communications because they can foster deeper connections. A good story should give people a feeling for you – your values, your principles, and the anticipation that working with you will be fulfilling and the results positive.

For example: if you are asked “Why should I/we hire you?”, you might reply “Well, several of my other clients in situations very much like yours have told me that they appreciate how quickly I zoom in on just the right issues. I’ve also heard that they like how I honor their principles and keep their internal teams energized. Oh, I can also inspire you with my HTML.” Whether you like this answer or not, don’t you get a distinct feeling of the person sharing it? That’s the power of story.

Question 3: For a person who is a 9-to-5 employee looking to break out on their own, what would you say is the ‘story’ they need to have drafted before they make the leap into freelancing?

A self-starter freelancer should have three stories:
 1. The story of a customer’s or client’s situation that you can help with
 2.  The story of what it’s like to work with you, and
 3. The story of you – you made yourself who you are, your values, and how recent changes are part of what makes you the best you that ever has been."

Sunday, June 25, 2017

Wyn Wachhorst's Thomas Alva Edison: An American Myth

Click here to go to the Amazon page for this book.

Wachhorst is an historian and this 1981 book was well received. When I wrote my papers on entrepreneurs as heroes in 1992, I had not heard of it. But I discovered it years later (2007) doing a google search. Wachhorst uses Joseph Campbell's book The Hero With a Thousand Faces to analyze part of Edison's early life, although Wachhorst suggests that Edison might have been more trickster than hero. This is covered in a thirteen page section called "Edison's Night Journey." Very fascinating to read.

Here are some of the concepts that come up, many of which I used in comparing entrepreneurs to heroes:

Psychic symbolism
Archetypal dreams
The separation-initiation-return pattern of the adventure
The hero returning with a book for society
Shades of supernatural origins
The call to adventure
A protective figure (an old crone-mentor is not mentioned)
Threshold guardian
Belly of the whale
Road of trials (although Wachhorst says that these, for Edison, were minor or over dramatized)
Awakening from the night journey
Reentry to the everyday world
He gets compared to the tricksters Hermes and Prometheus (using electricity like stealing fire-Prometheus gets mentioned many times in the book)
Edison was the "apotheosis of barnyard tinkering"

Wachhorst quotes David McClelland from The Achieving Society with:

"Interestingly, David McClelland found that Hermes, the trickster of the Greek pantheon, is the mythological type which best reflects the "achievement personality.""

In one of my papers I also mention tricksters.

The word entrepreneur does not appear in the index of the Edison book. So I don't think Wachhorst looked at any research on entrepreneurs in general. Schumpeter and creative destruction don't get mentioned. Schumpeter said creative destruction is the essential nature of capitalism.

Campbell has  a  section  called "The Cosmogonic Cycle" which "unrolls the great  vision  of  the  creation  and  destruction of   the   world   which   is   vouchsafed   as revelation  to  the  successful  hero"

That is why I called one of my papers "The Creative-Destroyers."Wachhorst does call Edison "father of the electrical age." One could possibly assume that Edison created this new age and therefore destroyed the previous age. In my papers I talk about how Henry Ford created the automobile age and destroyed the horse and buggy age.

Wachhorst does not mention the radio interview when Campbell said entrepreneurs were heroes.

Friday, June 23, 2017

The Wall Street Journal Recognizes That Entrepreneurs Might Be Like Heroes From Mythology

An Entrepreneur’s Story Can Be the Perfect Marketing Tool But the startup’s tale has to grab customers. Here’s how. By Barbara Haislip of the WSJ. She spoke to Angela Randolph, assistant professor at Babson College. Excerpts:
"Effective business narratives tap into old archetypes of storytelling that go all the way back to the earliest tales of mythology. “Stories about founders and new innovations are often in the form of a myth and follow the hero’s journey,” says Dr. Randolph.

Like the heroes of classic tales, she says, the company founder is going about a normal life when they run into a problem that interrupts it. After this call to action, the founder undergoes trials that must be overcome—and along the way transforms into a leader and the idea turns into a product, service or revolutionary change. Then the founder returns to “normal” life as an entrepreneur with a product or service for society.

Founders should keep that structure in mind when coming up with their own narrative, she says, and then highlight important points.

“Strong emotions can be triggered during the hero’s call to action. For example, if the product is the result of a family member being injured or dying, the strong, sad emotions associated with the tragedy are the strong call to action that pulls the audience in,” she says. Also highlight “favorable characteristics that founder exhibited during the trial and/or the new characteristics that are the result of the trials.”"

But this all just says what I had said in my work back in 1992. I wrote a paper called "The Creative-Destroyers: Are Entrepreneurs Mythological Heroes?" It compares the entrepreneur in capitalism to the hero in mythology. I was never able to get it published in an academic journal. One referee even said the idea was dangerous. I doubt much harm would have befallen the U.S. economy had this paper been published. It is now online at

Creative Destroyers

A shorter version is at

Shorter Version

The shorter version is titled “The Calling” of the Entrepreneur (Published   in The   New   Leaders:   The   Business   Bulletin   for   Transformative   Leadership,  November/December 1992.)

Friday, June 2, 2017

How Odysseus Started The Industrial Revolution

Factory work may have been a commitment device to get everyone to work hard. Odysseus tying himself to the mast was also a commitment device. Dean Karlan, Yale economics professor explains how commitment devices work:

"This idea of forcing one’s own future behavior dates back in our culture at least to Odysseus, who had his crew tie him to the ship’s mast so he wouldn’t be tempted by the sirens; and Cortes, who burned his ships to show his army that there would be no going back.

Economists call this method of pushing your future self into some behavior a “commitment device.” [Related: a Freakonomics podcast on the topic is called "Save Me From Myself."] From my WSJ op-ed:
Most of us don’t have crews and soldiers at our disposal, but many people still find ways to influence their future selves. Some compulsive shoppers will freeze their credit cards in blocks of ice to make sure they can’t get at them too readily when tempted. Some who are particularly prone to the siren song of their pillows in the morning place their alarm clock far from their bed, on the other side of the room, forcing their future self out of bed to shut it off. When MIT graduate student Guri Nanda developed an alarm clock, Clocky, that rolls off a night stand and hides when it goes off, the market beat a path to her door."
 See What Can We Learn From Congress and African Farmers About Losing Weight?

Something like this came up recently in the New York Times, in reference to factory work and the Industrial Revolution. See Looking at Productivity as a State of Mind. From the NY Times, 9-27. By SENDHIL MULLAINATHAN, a professor of economics at Harvard. Excerpts:
"Greg Clark, a professor of economics at the University of California, Davis, has gone so far as to argue that the Industrial Revolution was in part a self-control revolution. Many economists, beginning with Adam Smith, have argued that factories — an important innovation of the Industrial Revolution — blossomed because they allowed workers to specialize and be more productive.

Professor Clark argues that work rules truly differentiated the factory. People working at home could start and finish when they wanted, a very appealing sort of flexibility, but it had a major drawback, he said. People ended up doing less work that way.

Factories imposed discipline. They enforced strict work hours. There were rules for when you could go home and for when you had to show up at the beginning of your shift. If you arrived late you could be locked out for the day. For workers being paid piece rates, this certainly got them up and at work on time. You can even see something similar with the assembly line. Those operations dictate a certain pace of work. Like a running partner, an assembly line enforces a certain speed.

As Professor Clark provocatively puts it: “Workers effectively hired capitalists to make them work harder. They lacked the self-control to achieve higher earnings on their own.”

The data entry workers in our study, centuries later, might have agreed with that statement. In fact, 73 percent of them did agree to this statement: “It would be good if there were rules against being absent because it would help me come to work more often.”"
The workers, like Odyssues, tied themselves to the mast to resist the temptation of slacking. This made it possible for factories to generate the large output of the Industrial Revolution.

Some economists have written a paper called TYING ODYSSEUS TO THE MAST: EVIDENCE FROM A COMMITMENT SAVINGS PRODUCT IN THE PHILIPPINES. By Nava Ashraf, Dean Karlan, and Wesley Yin in The Quarterly Journal of Economics in 2006. Here is the abstract:
"We designed a commitment savings product for a Philippine bank and implemented it using a randomized control methodology. The savings product was intended for individuals who want to commit now to restrict access to their savings, and who were sophisticated enough to engage in such a mechanism. We conducted a baseline survey on 1777 existing or former clients of a bank. One month later, we offered the commitment product to a randomly chosen subset of 710 clients; 202 (28.4 percent) accepted the offer and opened the account. In the baseline survey, we asked hypothetical time discounting questions. Women who exhibited a lower discount rate for future relative to current trade-offs, and hence potentially have a preference for commitment, were indeed significantly more likely to open the commitment savings account. After twelve months, average savings balances increased by 81 percentage points for those clients assigned to the treatment group relative to those assigned to the control group. We conclude that the savings response represents a lasting change in savings, and not merely a short-term response to a new product." 

Tuesday, May 30, 2017

How Storytelling Can Shape the Corporate Brand and Culture

By Jay Gronlund.
"Technology has transformed our world into a data-obsessive circus where information is unbelievably accessible, connectivity is constant, and unpredictable events always surprise and engulf us. Call this extreme clutter and volatility. With so much information and multi-tasking surrounding us, it has become a challenge to restore simplicity, clarity and focus in our communications. These excessive conditions provide the main impetus for the re-emergence of storytelling for inspiring, engaging and connecting to others.

Storytelling is ageless and remains the most powerful form of persuasion. Socrates recognized the value of storytelling, so did Aesop, Jesus, Muhammad, Confucius and even Mark Twain. Today the power of storytelling has been scientifically proven:

    Neuroscientists have shown that the brain was built to wander on average over 1,000 times per day (e.g. including daydreams). They also found that storytelling stops this wandering and engages the listener (they call this “neuro-coupling”).

    Bruce Perry, an expert on brain development, says that “neural systems fatigue quickly, actually within 4-8 minutes, and become less responsive,” but can be stimulated and sustained by storytelling.

    Artificial Intelligence specialists have been studying how our brain actually works, especially how we file and store all this information that the brain absorbs every day. They discovered that the brain does not process information in “files” (e.g., like a computer program). As an example it sorts information from a PowerPoint presentation in a way that the first and last items on a list are usually remembered (also any item that has an emotional impact), and the rest is discarded as “trash” and never retrieved. Instead, the brain more effectively files and retrieves information when there is a context, as in the form of a story.

    Reinforcing this discovery, author and marketing professor Jennifer Aaker from Stanford notes that people remember stories as much as 22 times more than they do facts alone.

So what can storytelling do to improve communications, process our changing world, and especially help shape a corporate brand and culture? Vibrant leaders now recognize that storytelling can create an emotional connection, which is the heart of good branding. It engages listeners emotionally, creates empathy, and inspires action. Importantly, neuroscience has also concluded that humans are more likely to make decisions based on emotions, not rational thinking.

Our world is changing dramatically and so leaders are more challenged than ever to adapt to such a groundswell of populist trends, technological advances, declining trust in the establishment, globalization, growing uncertainty (particularly with the incoming Trump administration), and fundamentally what a corporation should stand for today. All these changes can affect a corporate brand and culture, so it is incumbent for a CEO to explain and especially inspire support for any updates on its corporate values and strategy. Simply using words and sharing data with customers and employees can be too cerebral and esoteric, but using storytelling to communicate “who we are,” “what we have learned,” and “why we are changing” will be far more captivating and motivating. Storytelling describes a journey and is ideal for meaningful change.

For millennials, storytelling represents an ideal form of communication. This “first digital generation” thrives on social media, which is different from traditional media mainly in that it involves a one-on-one conversation that begs for engagement, versus the one-to-many in mass marketing. Many older managers don’t understand or even resent the independent, restless, unpredictable tendencies of millennials. However, millennials represent a huge opportunity for creativity and innovative ideas, so they should not be ignored. They do want to learn and respect experience, albeit sometimes in trying ways, but the key to maximizing their potential is to engage them. And this is what storytelling does.

More companies today are using storytelling to recruit and train new employees–Apple, IBM, 3M, Nike, Coca Cola, Disney, Microsoft, NASA, and other forward-thinking organizations. In addition, as social media becomes more mainstream for advertising, they are using storytelling to engage prospective customers in blogs, videos, newsletters, content branding, and other digital communication vehicles.

Millennials simply don’t trust traditional advertising–95% rely on feedback from friends for purchase decisions instead and find stories much more credible and trustful for learning about products. Storytelling is also ideal for young entrepreneurs who focus more on cost-efficient digital media and realize that stories about their personal experience can create a strong emotional connection.

To update a corporate culture and strengthen a brand, one must learn more about the types of stories that will work, depending of course on the audience and their aspirations, the different situations (e.g., for a new leader, change in direction, new challenges, etc.) and the various nuances for making a story credible, compelling and emotionally engaging. But it all starts with a recognition of the power of storytelling in communications.

Jay Gronlund is President, founder of The Pathfinder Group, a business development firm specializing in emotional branding, ideation facilitation and international expansion. His background has focused mainly on marketing and new product development with executive positions at reputable companies in the US and abroad – Richardson Vicks/P&G, Church & Dwight, Seagram and Newsweek. Jay has also been teaching a branding course at NYU since 1999 and recently wrote a book on the “Basics of Branding”, published by Business Expert Press. Jay has a BA from Colby College and MBA from Tuck at Dartmouth (see for previous articles and blogs."