Top Shelf Reading Picks:

This week I read Sway: The Irresistible Pull of Irrational Behavior by Ori and Rom Brafman. While I can’t say I liked it as much as their first book, The Starfish and The Spider, it did have some good points for marketers. The premise of the book is that humans don’t always make the most rational decisions. Well, that’s for sure because if we did, divorce lawyers, overpriced fashion designers and the entire city of Las Vegas would be out of business.

Sway is not a “business” book, in the sense that it doesn’t give instructions as to how to sway people to buy your services or products. But it does explain what can happen to cloud people’s rationality. It’s an intriguing read, and I thought it explained much more about gut instincts than Malcom Gladwell’s Blink: The Power of Thinking without Thinking did. Unfortunately, there were no major aha moments. However, there were a few, “hmmm, now that makes sense” ones.

In fact, as I was reading the book, there were a couple of instances where I did a double take because I thought I had read the section before. It turns out that Sway was covering territory touched on by The Breakthrough Company and Predictably Irrational. I didn’t see this as a bad thing. It reminded me of doing research as an attorney: When all the cases started quoting each other, you knew you had that brief down solid.

Here are some of the interesting points I found to ponder:

1. We overreact to perceived losses. Humans have loss aversion. See also the section in Breakthrough Company about the psychology of betting. Why do we buy an unlimited plan when we have never gone over 400 minutes on our cell phones? Because we fear that one day we might. Thus, we fear a loss and perhaps overkill on the precautions. Loss aversion hit home with me because I realized that I was paying my tech support team on a monthly basis and incurring monthly wire transfer fees that could definitely be saved if I paid every other month or even quarterly. What prevented me from doing that? My fear that my tech team (in India) might disappear on me. Yet I’ve been working with these guys forever and they even traveled to Boston to meet me. The chance of them disappearing after I paid them my monthly retainer is probably less than a wire transfer getting lost.

2. First impressions mean a lot. For example, NBA players are stuck performing at the level at which they were drafted, regardless of whether they deliver. Studies have found that when a team drafts a player in the first round the team will play that player consistently more than a third round or lower pick regardless of whether the player’s stats are better or not. So we shouldn’t be surprised that once you are labeled a lower pick, you are forever deemed to be on that level. (Interesting outtake for this would be re: salary negotiations: Come in at a low value, and you’ll remain there!) This example reminded me of my own college tennis experience. I was a doubles specialist on a Division 1 team. I was number nine on the bottom of the ladder right next to our number 10, who was also a doubles specialist. Together we could beat any of the better players at doubles. Yet, the coach insisted on playing our number one and two singles players at the top doubles position (they didn’t even like each other); three and four at the number two position, etc. It didn’t matter that we could beat most of the combinations of players. I never understand this before now. The coach had worked hard to get nationally ranked players on his team: He had a much bigger investment in them than his number nine and 10, who got in on grades, not athletics!

3. Interviewers are not well-served by interviews where they hit it off with the interviewee. They can be swayed into thinking the candidate is more qualified than he or she may actually be. Also, read the book to find out why the best question to ask in an interview is: “What do you know about our company?”

4. In advertising, people will often focus on the wrong data points. For example, a pretty woman in an ad might sway a man to ignore the minor details. Attractive woman = attractive offer.

5. When we label people, they start to take on those characteristics. First, because it’s that old parenting “no-no”–tell a kid he’s a failure, and he will live up to your statements; and second, because we want to be right about people, so we focus on things that make our original characteristics accurate.

6. Different cultures can act differently in similar situations. The Who Wants to be a Millionaire example was really interesting. When someone needs a lifeline (i.e. the audience) to help him or her answer a question, audiences in Russia were almost all likely to give the contestants the wrong answer. The authors tie this back to a Russian cultural belief that “why should anyone be better or richer than the rest?” In the US, on the other hand, we worship those who make money, even if it’s handed to them, so American audiences were more than likely to provide the right answer. I’m assuming this is similar to Australia’s Tall Poppy syndrome (rise too far above the crowd and someone will come along and lop you off!)

7. Monetary incentives do not work. This was also covered in Predictably Irrational. Ask a friend to move some furniture, and he probably will. Offer to pay him to do so, and he won’t find the time.

8. The sway of the group mentality is a powerful force. Call it peer pressure or whatever. When we have to stand alone, we tend to question ourselves. The authors have an interesting Supreme Court solution. The lone dissenter states “I disagree, but not enough to write an official dissent.” This gives room for another justice to jump in on the disagreement, which might help sway the court in a different direction, while it allows the lone voice to speak up and fish for other supporters.

9. When we find ourselves unsure about whether to continue a particular approach, it’s useful to ask, “If I were just arriving on the scene and were given the choice to either jump into this project as it stands now or pass on it, would I choose to jump in?”

10. They also discuss in the epilogue how the price of an object can affect how we feel about it. That $600 purse has to look so much better to us than the $60 alternative; otherwise, why would it be that expensive? I see this all the time in fashion. I block out the designer influence by figuring out in advance the item I might need (i.e. a gray cashmere blend V-neck sweater). Then if I find it in TJ Maxx or at a French flea market, great–why pay more if I’ve met my need? This way the item doesn’t become any less attractive to me (or others) just because it only cost me $20, not $2,000.

The book concludes with the obvious finding that people do not behave rationally. How you put this into action is up to you.

Top Shelf Bottom Line – This was a good read for someone who’s adept at picking up on theory and running with it. As mentioned, this is a book about people’s behavior, not an instruction manual as to how to manipulate them to buy your product or service. Yet it covers relevant material for any marketer trying to sway an audience with some really interesting anecdotes, much like their first book. I found it a good complement to Predictably Irrational, which had more studies and data incorporated but some of the same results. In retrospect, Sway would probably be a great audiobook.

**A couple of other books besides those mentioned above that touch on this and related topics are:

Gut Feelings: The Intelligence of the Unconscious – click here for my review.

The Paradox of Choice: Why Less Means More

I couldn’t help but hear riffs of Doors songs in my head . . . Break on through to the other side … as I was reading The Breakthrough Company: How Everyday Companies Become Extraordinary Performers by Keith R. McFarland. The “other side” in this case is one where your basement startup is no longer a small company.

I liked McFarland’s book because, despite talking about companies bigger than my own small startup, the companies he focused on were not the classic behemoths. In fact, there were a few I knew quite well (The Staubach Company, for one). While the book is based on survey data of 7,000 companies, it didn’t read like a business school textbook. Instead, it focuses on only nine companies and included some firsthand stories and experiences. (Note to future business book writers–putting bits of yourself into the book is one way to keep it from reading like a dry textbook.)

I’ll cut to the chase because I know you’re all reading this book to find out what elements make a breakthrough company. According to McFarland, they are:

Throwing the dyno: In other words, taking that huge risk/leap of faith at the right time and in the right direction.

Crowning the company: Breakthrough companies do not have a coronation for the founder, but for the entire company–empower the masses, and growth should follow. One reason to do this is that sometimes the very strengths that make a great entrepreneur in the building stages–snap decision-making, stick-to-it stubbornness–can be liabilities as the company grows.

Upping the ante: Similar to throwing the dyno, it’s sort of a “go big or go home” strategy. The example McFarland gives is of Intuit co-founder Scott Cook, who had $100,000 in the bank and could either milk it for a few more months or go big with a huge ad campaign and spend it all in one swoop. Intuit went for it (all or nothing), and it worked!

Building company character: I loved McFarland’s emphasis on first impressions. What do people see when they go to your office? That all the execs have the front parking spaces? Or are they free for “expectant mothers only”? This reminded me of my old days in commercial real estate, when live people actually answered the company phone. Interviewing for a receptionist was crucial. At one high-end firm I worked for, they spent money to get qualified, friendly people who usually had an accent (English accents probably got a premium). At a less prestigious company where I also worked, they strove for the same thing, and I remember how much we loved the extremely capable and well-dressed woman with the impossible-to-understand East Boston accent, but went with the slightly younger gal with the Southern drawl and the questionable taste in dressing (we figured she was mostly on the phone or hidden behind the desk, so we could work on the dressing taste more easily than change a Boston accent).

While I run a virtual company, one thing I do is to have my staff and colleagues start every e-mail response, with “Thank you for writing,” no matter what the e-mail is about. I’ve found that this can defuse even an irate customer.

Other ways McFarland talks about how to find your company’s character is in the equation: Company Character = Values Translated into Action. (i.e. walk the talk.)

I also liked this chapter because I agreed wholeheartedly with his discussion of Fastenol’s success, which the CEO described as, “We hired attitude and trained aptitude.” I’ve always believed that the best person for any job is not always the individual who has all the required skills coming in. Many of those skills can be taught. Unfortunately, poor attitudes are something not so easily overcome. Thank goodness others believe in this or I never would have gotten some of the jobs I did! Another standout statement in this chapter: “A company’s view of people is an unmistakable reflection of its organizational character. If it sees people as selfish, lazy and unmotivated–that’s the kind of people it will attract.”

Navigating the Business Bermuda Triangle: McFarland describes the Business Bermuda Triangle as having three points: 1) Giving customers what they want; 2) Reacting quickly; and 3) Keeping costs low. Companies that don’t break through can get lost in this triangle as they grow. How to avoid the triangle? Two strategies:

• “Don’t diversify before you own your existing market.”
• “When you do diversify, let your customers lead you.”

Erecting scaffolding: Very good chapter on networking, as it doesn’t look at it from the individual point of view, but rather from a company perspective. The best part of this chapter was the “surprising findings” for breakthrough companies:

1. Four of the nine profiled companies were founded or headed by people who belonged to the same organization–Young Professionals Organization (YPO).
2. Networking was not an “executive” trend but was encouraged and executed by all employees at all levels. I was recently asked by a company after a speech about online networking whether I approved of its policy of only allowing senior management to use LinkedIn and other social networks. I have to admit, I was a bit blunt and asked her why didn’t it focus more on making younger employees want to stay, rather than keeping them from being recruited. I’d be surprised if they’re still in business a couple of years from now.
3. Breakthrough companies use their network to build advisory boards that challenge them. No “yes” men and women.
4. Breakthrough companies considered their clients and customers part of their networks.

Enlisting insultants: No, not Adam Sandler, but instead, company insiders who question the way things are done. Hmmmm. I’ve been called a troublemaker in the past for wanting to change things, but never an insultant. Not sure which I like better. But I certainly would never again work for a company that did not value employees who questioned the way things are done. In fact, some top companies such as EMC are enlisting social media to help democratize the practice (For more on this, check out my Smash the Ladder interview with Polly Pearson, VP of employment, brand and strategy engagement). Best part of this section is the Insultant’s Style Guide, which includes six tips for being a good insultant.

Graduating from Tough Times U: Basically, this chapter gave some advice as well as some really scary examples of tough times from breakthrough companies. I felt for Roger Staubach early on as a 10 percent owner stuck holding  several million dollars in debt for everyone. But rather than fold, he turned things around with the help of many of the strategies discussed above.

Building the breakthrough company: McFarland ends with some steps to help you and your company break on through to the other side . . .

Top Shelf Bottom Line: This is a great book for startup companies to keep on their shelves as they grow. There are some good basic business 101 reminders but also some surprising insights. My favorite part of the book came at the end of each chapter where McFarland has a section of “Findings that surprised us.” These often surprised me, too.

The following is an abbreviated review of American Wife: A Novel by Curtis Sittenfeld. I’m including a fiction pick as 1) it was the best non-business book I read this summer; 2) it’s controversial; and 3) it’s a behind-the-scenes look at the role of a first spouse–something that has been much in the forefront of the media and relevant to the topic of leadership. The full review can be found at www.womensdish.com.

Let’s start off this review by laying all the cards on the table.

First, the opinions expressed in this review are solely that of blogger Diane K. Danielson, individually and personally, and do not reflect those of Entrepreneur magazine, WomenEntrepreneur.com, or their management. Thus, if you are an avowed Bush fan, you might not want to continue reading this particular post. However, if you can put politics aside and find this book review of interest, note that on Sept. 3, we’ll be announcing in our Downtown Women’s Club Dish Newsletter how you could win one of 10 free copies that Random House is giving away. Visit DowntownWomensClub.com to register for the DWC Dish. Thanks, Random House!

[Note to readers: If the forces behind Obama Nation or any unauthorized bio of Hillary Clinton had sent us an advanced review copy PLUS books to give away, we’d likely be doing that, too! I've always believed in reading different perspectives.]

Second, American Wife: A Novel is a fictional portrayal of the life of Laura Bush by Curtis Sittenfeld, the author of Prep: A Novel (after reading that I vowed never to send my child to boarding school) and The Man of My Dreams: A Novel (haven’t read, but will now). Sittenfeld is an avowed liberal despite having a professed fascination (and appreciation) for Laura Bush.

Third, there’s been a bit of controversy over the book, due to be released on September 2, during the Republican National Convention. Some people believe that the book is an attack on the Republican Party. In addition, there’s a faction out there that believes that Laura Bush is sacrosanct and no one should write about her. I noted that most of the critics, as usual, had not read the book and focused on the fact that the book includes some “steamy sex scenes.” Now, clearly those folks have never read a Jayne Ann Krentz novel, because the sex scenes in American Wife were not all that steamy or significant. And I don’t buy the argument that any public figure is too sacred to be the subject of a novel.

Fourth, the novel does incorporate some events that parallel those in Laura Bush’s life. The main character, Alice Lindgren (later Alice Blackwell), like Laura Bush, ran a stop sign at age 17 and killed a classmate. She later becomes a librarian and, when she is in her early 30s, marries Charlie Blackwell of the rich and powerful Blackwell clan. Charlie is an overgrown child, with a bit of a drinking problem, who later in life finds religion and goes on to become the president of the United States. Other than that rest is purely imagined.

Fifth, I am a liberal democrat who has always been rather annoyed by Laura Bush and assumed that she was majorly medicated, because I couldn’t fathom how anyone could possibly raise daughters around her husband’s beliefs.

With all that being said, I was a bit apprehensive and unsureabout why I wanted to read about anything related to the Bush administration. However, I’ll cut to the chase. I loved the book. It was the best read of the summer. And I would like to believe some of it is true because then I would understand and–yes–appreciate Laura Bush.

*** Click here to read the complete review, or see below for the Top Shelf Bottom Line***

The Top Shelf Bottom Line: American Wife: A Novel was the best fiction I’ve read in a long time. And I wonder if this is even close to what the real Laura Bush is like? I’d like to think so. But we’ll never know (in fact, I’m starting to see that as some of her charm). As for George W. Bush, if even 10 percent of this is based on reality, and this is truly what the leader of our country is like behind the scenes, we need to rethink how we elect leaders in the future.

Because the book touches on leadership, and because I’d like to make it relevant to this blog, I’m wondering whether it could serve as sort of an anti-leadership guide. Despite my new leniency toward Laura, she may still not be the right First Lady for a country as troubled as the U.S. To be an effective leader, you cannot surround yourself with only “yes men or women.” It leads to unhealthy narcissism, and often ideas getting too far along to pull back. American Wife gives us a glimpse into how much power a first spouse has, as they act almost as an informal member of the cabinet. (Note the contrast of Eleanor Roosevelt and FDR where she openly disagreed with him while he was in office. FDR handled it by assuming the public understood that she could have her own opinions that were not his. He also used her as a testing ground for some of his more liberal ideas.)

Could a stronger first spouse have reigned in the excess? Or even prevented an ill-fated presidency from happening in the first place? We won’t ever know, but I hope we’ll have an opportunity to find out.

*** Sign up for the Downtown Women’s Club e-newsletter ASAP at www.downtownwomensclub.com and find out in the Sept 3 issue how you can win a free copy of American Wife. We’re giving 10 copies away courtesy of Random House.