1

Darwin spent much of his life engaged in reverse thinking, trying to overthrow the concepts he himself had painstakingly established, which was also his most cherished viewpoint.

Throughout my long career I've absorbed and digested a few super simple universal concepts that are helpful for solving problems. Here are five of them, and then I'm going to present you with an extremely difficult problem. It's really tough, because it involves taking $2 million in start-up capital and turning it into a number big enough to be termed an achievement of epic proportions — $20,000 billion.

I'm going to try to solve this problem using my universal concepts. Afterwards, I'll tell you about some important educational conclusions I've drawn from the process of deduction. And I'll wrap up the talk that way because, after all, the whole point of this exercise is to be educational; the purpose of today's game is to explore better ways of thinking.

My first useful concept is that the best way to simplify a problem is often to properly decide the major issues that can be judged without much effort.

My second concept mimics Galileo's conclusion, that scientific facts are usually revealed through mathematical ways, and mathematics are like the language of God. Galileo's theory is also very applicable in the chaotic and messy practical world. Without fluent mathematical thinking, it's like a one-legged person participating in an extremely intense competition, it's impossible to win.

The third concept is that using only positive ways of thinking to solve problems is not enough. You also need to learn to think in reverse. Otherwise you'll end up like a villager who wants to know where he'll die, so he'll never go there. In fact, many problems can't be solved by positive thinking alone. That's why the great algebraist Carl Jacobi would always say, "Invert, always invert." Pythagoras also proved that the square root of 2 is an irrational number through reverse thinking.

The fourth useful concept is that the best and most practical wisdom lies in basic knowledge. However, there is an extremely important limiting condition: you must use interdisciplinary thinking. You must become accustomed to using the simple and easy-to-learn truths that you'll find in the first year's course of every basic subject.

Once you master these basic concepts, you won't be constrained by the problems you're trying to solve. Universities and many commercial institutions are limited by the division into well-separated subjects and different departments. They strongly discourage you from taking risks outside their pre-defined areas. Instead, you must engage in interdisciplinary thinking, like Benjamin Franklin advised in Poor Richard's Almanack: "If you would not be forgotten, as soon as you are dead and rotten, either write things worth reading or do things worth the writing."

If you rely too heavily on others in your thinking habits, and frequently spent money on seeking advice from professionals, then regardless of when you step out of your narrow circle, you will encounter a lot of misfortune. This not only makes you exhausted and bogged down in complicated coordination work, but you will also suffer from the fact that a character created by Shaw has revealed: "In the end, every profession is nothing more than a trick to deceive outsiders."

In fact, the character sculpted by Shaw speaks about what he hates the most. This is not always because your narrow-minded professional consultant deliberately neglects their job and exhausts you. On the contrary, your dilemma is usually caused by his unconscious bias. Because his economic interests are at odds with yours, your goals are often damaged by his cognitive bias. At the same time, he will also experience the psychological distress described by the following proverb: To a man with only a hammer, every problem looks like a nail.

The fifth useful concept is that truly great and outstanding accomplishments can only result from the combined forces of many factors. For example, there is medicine to treat tuberculosis, at least for some time now, with the prescription being a mixture of three different drugs. Another outstanding accomplishment, like airplanes taking off, also follows the same pattern.

And this hurdle is the highest. It not only requires rich practical investment experience, deep understanding of trading systems and markets, but also the individual's personality, values, and understanding of the world to reach a realm where they can control and adhere to the trading system. They must regard the trading system as part of their lifestyle, integrate it into their thoughts and souls, and merge with the trading system to achieve the effect of passive investment. I think that's just about it.

Now it's time for me to present the actual problem, which is as follows:

In 1884, in Atlanta, you and 20 other people like you were brought before a wealthy and eccentric Atlanta citizen named Glotz. You and Glotz have two things in common:

• First, you'll generally use those five very useful principles of universality to solve problems;

• Second, you both know all the basic concepts taught in every basic course in college, those that were taught in 1996.

However, all inventors and all examples used to prove these basic concepts existed prior to 1884. You and Glotz are unaware of anything that happened after 1884.

Glotz is willing to invest $2 million (in 1884 currency) in a new company to break into the non-alcoholic beverage industry and to maintain operations in this industry. He would donate half of the net assets to establish the Glotz Foundation for Charity. Glotz wants to give this drink a catchy name that appeals to him: Coca-Cola.

The other half of the net assets of this new company will be given to someone who can prove to Glotz that his business plan will make the Glotz Foundation appreciate to $1 trillion in 2034, even though the company has to pay out a large part of its profits as dividends every year. Even after deducting hundreds of millions of dollars in dividends paid out, the overall value of this newly established company will reach $2 trillion.

What would you say to Glotz if you had 15 minutes to pitch?

Here is my solution. The plan I proposed to Glotz uses only useful universal principles and some concepts that every smart college sophomore should know.

Glotz, to simplify our problem, first we need to make a 'no-brainer' decision. The decision process is as follows:

• First, we should never expect to make $2 trillion by selling ordinary drinks alone, so we must establish the 'Coca-Cola' brand as a powerful and legally protected trademark.

• Second, we can start with the Atlanta market, then successfully take over the markets in other parts of the United States, and finally rapidly promote our new drinks globally in order to make $2 trillion.

This requires the development of a product that resonates with the world because it uses a powerful natural force. This powerful natural force can be found in the theme of college basic courses.

Next, we will determine what our goal means through digital calculation. We can rationally guess that by 2034, there will be about 8 billion beverage consumers worldwide.

On average, these consumers, when calculated at actual values, will be much richer than the consumers in 1884. Each consumer's body is mainly composed of water, and they must consume a large amount of water every day to supplement their needs, which is equivalent to eight cans of drinks.

It seems that if our new drink and other drinks imitating ours can occupy or expand 25% of the world's beverage market, we can occupy half of the entire new market. By 2034, we will be able to sell 2.92 trillion cans of drinks.

If we can net a profit of 4 cents per can, we can earn about $117 billion. This is enough. If our company can maintain a good growth rate, it will be easy for us to reach the value of $2 trillion in 2034.

A key question is whether the profit target of net 4 cents per can will be reasonable by 2034. If we can create a beverage that resonates with the world, the answer is yes. 150 years is a long process, and the dollar, like the ancient Roman currency unit Drachma (Greek currency unit), is bound to depreciate. At the same time, the actual purchasing power of ordinary beverage consumers worldwide will also increase significantly.

In addition, the tendency of consumers to buy cheap goods will also make them more experienced, while the price of drinking water will rise quite rapidly.

At the same time, with the advancement of technology, the cost of our simple product measured by unchanged purchasing power will decrease. All four factors together are favorable to our profit target of 4 cents per can. If measured in US dollars, the global beverage purchasing power is likely to increase at least 40 times in 150 years. On the other hand, this makes our profit target per can just one-fortieth of 4 cents per can or one-tenth of 1 cent per can in 1884's conditions. If our new product can resonate globally, this goal will be easily surpassed.

Three.

This determines that the next problem we need to solve is: how to produce a drink that has universal appeal. There are two intertwined challenges on a larger scale:

• First, we must create a new beverage market that can account for one-quarter of the world's beverages in 150 years.

• Second, we must operate carefully and occupy half of the new market, and all other competitors combined can only share the remaining half of the market.

All of these can be considered excellent achievements. Therefore, we must mobilize all favorable factors we can think of to solve this problem. In short, only by the combined action of multiple factors can we achieve the expected effect. Fortunately, if you remain awake through every college freshman course, these interwoven problems can be easily solved.

Starting from studying the straightforward decision we made without thinking-hard--relying on a powerful trademark, let's see what the consequences of doing so are. Naturally, such a result allows us to use appropriate basic professional terms to correctly understand the nature of our company.

From the perspective of basic psychology course, our essential idea is to establish a business that generates and maintains conditioned reflex. Coca-Cola's trademark and product packaging will become a stimulus, and the purchase and consumption of our drinks by the consumer will be the desired response we hope to receive. In terms of product structure, the operating income of 10-30 billion yuan products are 401/1288/60 million yuan respectively.

So, how to create or maintain a conditioned reflex? Psychology textbooks provide two answers: First, through operant conditioning; second, through classical conditioning, usually also known as Pavlovian reflex, named after the great Russian scientist.

Given that we want to achieve excellent results, we must use both operant and classical conditioning techniques, while also inventing various means to enhance the effects of each method.

Our operant conditioning in this issue is easy to solve. We just need to maximize the stimulus of drinking, and since competing products also use operant conditioning, we must minimize the possibility of creating conditioned reflexes that are difficult to distinguish.

We have found the following practical returns for operant conditioning:

• food provides energy or other nutritional values;

• According to Darwin's theory of natural selection, taste, texture, and smell become factors that stimulate consumption in the human nervous system;

• stimulants, such as sugar and caffeine;

• when people are hot, they want a cool feeling, but when they are cold, they want a warm feeling.

To achieve significant results, we will naturally include all these stimulating factors.

At the beginning, it is easy to decide that our drink should be designed to be consumed when frozen. This is because people are much more likely to drink to reduce heat than to drink to warm up. In addition, when it is hot, the body's water is consumed, the opposite when it is cold. It is also easy for us to decide to add both sugar and caffeine to the drink. After all, tea, coffee, and lemonade are everywhere.

At the same time, we know very well that we must decide on the taste and other characteristics of the new drink through countless trials and failures with a fanatical attitude, so that it can make people's pleasure feelings reach the extreme when it contains both sugar and caffeine.

Moreover, once the conditioned reflex we hope for is stimulated, it is very likely to be replaced by the operant conditioning of similar products. To avoid this situation, there is also an obvious answer: let our drinks appear everywhere in the shortest possible time and make it a goal that everyone in the company is crazy about. After all, if you haven't tried it, no competitive product will threaten us. This is a truth that every couple understands.

Four.

The next thing we must consider is how to use Pavlov's reflex principle. In Pavlov's classical conditioning experiment, the strong effect comes only from the connection between two behaviors. The bell ringing stimulates the dog's nervous system, making it salivate faster even without eating. Looking at the beauty that one can never get, the man's brain will have a strong desire for the drink she is holding.

Therefore, we must use a variety of reasonable Pavlovian reflexes that we can think of. As long as we are in this industry, our drinks and their promotional activities must be linked to all the things that consumers like or appreciate in their minds.

To build such a large-scale Pavlovian reflex must cost a lot of money, especially the cost of advertising. We will pay a huge amount of money at an unimaginable speed, but this money is spent on the blade edge. Due to our rapid expansion in the new beverage market, our competitors are at a disadvantage if they want to create the Pavlovian reflex effect they need, and must spend more money on advertising.

This result, coupled with the influence created by sales volume, should help us have at least 50% of the market share in any new market. In fact, if buyers are dispersed, our higher sales volume will provide a huge cost advantage for product distribution compared to others.

In addition, Pavlovian effects generated by chain reactions can help us choose the taste, texture and color of new drinks. Considering the Pavlovian effect, we wisely chose a name with exotic and sounding very high-end, "Coca-Cola," rather than something bland and unimaginative like "Glotz Coffee Soda."

For similar reasons of Pavlovian reflex, it will definitely be wise to make our drink appear more like wine than soda. Therefore, if this type of drink originally looks transparent, we must artificially add some pigments. At the same time, we will fill the drink with some carbon dioxide to make it look more like champagne or other high-end drinks, while also making it taste better and creating obstacles for competing imitators.

And because we want to attach so many psychological effects to the product to make it look high-end, the taste of this drink is inevitably different from any other common flavor. As a result, we can create the highest level of challenge for competitors to prevent them from profiting because their existing products collide with ours in terms of taste.

In addition, is there any theory in the psychology textbook that can help our new company? There is a powerful psychological nature in human beings, called "social proof" by psychologists. It can only be understood here as a kind of imitative consumption that is triggered by someone seeing others consume.

It not only helps us to tempt people to taste our drinks, but also encourages people's consumption behavior, and this encouragement can be personally felt. Whether we design advertisements, plan promotional activities, or consider sacrificing current and future sales for the sake of enhancing the sales capacity of the company, we must always take into account the powerful social proof factor. As far as increasing the sales of each distribution channel is concerned, it is more helpful than developing many other products.

What we now know is:

• A large number of Pavlovian conditioned reflexes are applied;

• Utilize strong social proof effects;

• Invent a drink that can elicit multiple operant conditioned reflexes in consumers because of its excellent taste, energy supplement, nervous stimulation, and is also as chilled as expected by people.

Through the combination of the above three points, we will use these carefully selected factors to accelerate sales growth for a long time. Therefore, we are about to start a self-catalytic effect similar to that in chemistry, which is the excellent effect we want, caused by many factors.

Our company's logistics and distribution strategy will be simple. There are only two practical methods for selling our drinks:

• Sell it as original or raw material to coolers and restaurants;

• Completely treat it as canned carbonated drinks. To achieve a powerful influence, we will naturally adopt both methods.

At the same time, if we want to obtain obvious Pavlovian conditioned reflex and social proof effects, we must conduct long-term advertising and product promotion activities. More than 40% of the original juice price will be used for sales channels.

Only a few original juice manufacturers can meet the needs of the world. However, every can of drink takes up space, and most of them are just water, which is unnecessary to transport back and forth. To avoid this situation, we need to set up bottled factories around the world. If we can establish a "first sales price" (just like General Electric did for its invented light bulb), whether it is our original juice or any packaged product, we can maximize profits.

Five

The best way to firmly grasp the control of profits is to make each independent bottler become our subcontractor rather than the buyer of raw juice, and of course not become the permanent franchisee of raw juice, nor can we set the price of raw juice forever at the initial price.

Since we cannot apply for patents for our most important taste, we will guarantee the safety of the formula like a person with obsessive-compulsive disorder. We will also hype the secret formula and make it mysterious, thereby further enhancing the Pavlovian effect. With the development of food engineering, others will eventually copy our product flavor almost exactly.

However, by that time, we will have gone far ahead. Due to a very powerful brand and a complete, "accessible" global distribution system, the replication of taste will not become an obstacle for us to move towards our goals.

The progress of food chemistry has certainly helped our competitors, but at the same time, technological innovation will also come with it, bringing us benefits. For example, refrigeration technology, faster transportation, and technologies such as adding sugar-free taste to beverages for dieters without adding sugar calories. In addition, relevant beverage opportunities will also come one after another, and we must firmly grasp them.

Six

Finally, let us use Jacoby's reverse thinking to check the development plan of the company. What do we not want and must avoid? It seems that there are four clear answers:

First, we must avoid the feeling of resistance caused by the drink being too sweet after drinking, which will stop the purchase behavior. This behavior belongs to the standard process of physiology, and according to Darwin's theory of evolution, it is because a universally effective self-restraint influence is imposed on the gene carrier to enhance the replication of human genes. In order for consumers to drink our products bottle after bottle in hot weather without feeling sick, we will find a wonderful taste solution in constant trial and error, so that the problem will be solved.

Secondly, we must avoid the use of trademarks or even partial names of trademarks. This would cause huge losses for us. For example, if due to our negligence, the market allows other types of "cola" to be sold, such as "BaiBi Cola". If such "BaiBi Cola" really exists, we must also be the owner of this brand.

Thirdly, while enjoying great success, we should also avoid negative effects from jealousy, a big human flaw that occupies a prominent position in the "Ten Commandments." As Aristotle said, the best way to avoid envy is to be truly worthy of praise. We will strive to pursue product quality, packaging quality, and reasonable prices, in order to bring pleasure to people on a harmless basis.

Fourthly, after the signature taste has swept the entire new market, sudden or major adjustments to the taste should be avoided. Even if the new taste performs better in blind tests, changing the taste is stupid. This is because our traditional taste has already penetrated into people's hearts. According to the psychology of the limited-choice effect, there is no benefit to making major adjustments to the taste.

If consumers have an excessive deprivation response (a strong discomfort reaction caused by something already owned being taken away) which makes it difficult for humans to face "loss," it will also cause most gamblers to lose their minds. In addition, such adjustments can allow competitors to use our previous efforts to win consumers who prefer the original taste, through the use of the negative emotions generated by the excessive deprivation response.

The above is my strategy for increasing 2 million US dollars to 20,000 billion US dollars after deducting billions of bonus. I believe that it will win the approval of Glotz in 1884 and be more persuasive than you originally thought. After all, the correctness of the decision is obvious when effective academic viewpoints are applied.

My proposed solution is very consistent with the development of the Coca-Cola company in the real world? Until 1896, 12 years after the fictional Glotz had used 2 million US dollars for the enterprise expansion, the actual Coca-Cola company's profits were less than 150,000 US dollars, and its profits were almost zero.

Later, it even lost half of its own trademark, and permanently authorized bottlers at a fixed original solution price. Some bottlers are not efficient, and Coca-Cola company is helpless. In such a system, if it retains the ability to control prices, the situation may be completely different if it loses the ability.

Even so, in fact, the Coca-Cola company followed most of the content handed over to Glotz's plan. Currently, its value is 125 billion US dollars, and in order to achieve the goal of 20,000 billion US dollars in 2034, it must grow at a rate of 8% annually. If the supply can increase by 6% per year during the period until 2034, it will easily achieve the supply target of 2.92 trillion bottles per year.

Moreover, after 2034, Coca-Cola still has a lot of room to replace ordinary water. Therefore, for the fictional character Glotz, if he can act more vigorously and avoid the most serious mistakes, he could easily reach the target of 20,000 billion US dollars, even before 2034.

This process finally brings me to the topic of today's speech. If my answer to Glotz's problem is generally correct, or if you can give another answer that I think is correct based on my answer, then we can assume that there is a major problem in the education sector-most of the educators who have obtained a Ph.D. degree, even psychology professors and business school deans, may not be able to give such a simple answer.

If my above solution and conclusion are correct, it also means that there are many teachers in our society who cannot even explain the Coca-Cola phenomenon in a satisfactory way, even if they are reviewing the company's history, even if they have been closely monitoring the dynamics of the company throughout their lives. This is not a satisfactory state of affairs.

Moreover, a more extreme outcome is that some capable and influential Coca-Cola company managers have achieved brilliant success in recent years, and are surrounded by graduates from business schools or law schools. But they themselves have not mastered the basic psychology of predicting or avoiding the catastrophic failure of "new coke". This is undoubtedly a major threat to the enterprise. These talented people have so many professional consultants from prestigious schools around them, and if this also proves that they are seriously disconnected from their education and reality, it is not a satisfactory state of affairs.

Seven

This extremely ignorant behavior in the academic field and the top-level of the enterprise is a negative "outstanding performance," which indicates that there are major flaws in the academic community. Because these negative effects are too "outstanding," we expect to find complex academic reasons. I think there are at least two reasons:

First, although psychology has conducted a series of clever and important experiments that fully demonstrate its charm and practicality, it lacks the comprehensive application within the discipline, especially the attention to the comprehensive effects of various psychological tendencies. This reminds me of a rural teacher who tried to simplify pi to 3. This undoubtedly violates Einstein's teachings: "Things should be as simple as possible, but not simpler."

Generally speaking, the current psychology knowledge is chaotic and misunderstood, just as if there were only outstanding experimenters like Michael Faraday in the history of physics, but no comprehensive summary masters like James Clerk Maxwell, then electromagnetics would also be misunderstood.

Secondly, the phenomenon in which psychology is integrated with other disciplines is rare at present, but only through a multidisciplinary approach can the real world be properly handled-just like in the case of Coca-Cola company.

In short, academic psychology is considered more important and useful than other disciplines. At the same time, psychology is worse than what most industry insiders think. On the product structure, products with business income of 10-30 billion yuan have sales revenues of 401/1288/60 million yuan respectively.

Of course, it is normal for self-evaluation to be more positive than external evaluation. Frankly speaking, such problems should probably be left for you to present today. However, this gap in psychology is so great that a very well-known university (University of Chicago) cancelled its psychology department, and they may secretly hope to create a better version in the future.

When things are in such a situation, many years ago, when many obviously wrong views already existed, the catastrophic failure of the "New Coke" event occurred and Coca-Cola management almost destroyed the world's most valuable brand.

In response to the sensational failure event that the media reported on, if the academic world had made the right response, it should have been the same as Boeing's response after three consecutive plane crashes in a week. After all, both events involve the problem of product integration. Obviously, our education has failed terribly.

But the academic world did not make any responsible, Boeing-style response. On the contrary, overall, they still continue the previous situation of warlords, tolerating psychology professors teaching psychology in the wrong way; non-psychology professors turn a blind eye to the psychological effects that can play an important role in their disciplines, and professional schools carefully maintain their tradition of ignorance of psychology and take pride in their shortcomings.

Eight

Since this regrettable blindness and weariness has become a norm in the academic world, are there any exceptions that can bring us hope and finally correct these unsightly shortcomings in education? Here, I have a very optimistic and affirmative answer.

Let's take a look at the recent performance of the University of Chicago's economics department. In the past decade, this department has almost swept all the Nobel Prizes in Economics, mainly because it broke away from the assumption of human rationality in the "free market" mode, and made many outstanding economic predictions. What did this department do after achieving such stable victories through rational thinking?

They just invited a witty and humorous economist, Richard Taylor from Cornell University, to undertake a very important position in the department. This department did this because Taylor ridiculed everything that the University of Chicago had once respected.

Taylor and I both deeply believe that large-scale irrational behavior often occurs in people, and this way of behavior can be predicted by psychology and must be considered in microeconomics.

The practice of the University of Chicago is following Darwin-he spent much of his time thinking backward, trying to overthrow what he had painstakingly established, his most cherished views. As long as there are some disciplines in the academic world that can think backward like Darwin, and continue their most valuable part, we can make a confident expectation: stupid educational practices will eventually be replaced by better ones, just like the speculation that Carl Jacoby may make.

This will eventually happen because a Darwinian approach is a viable approach that habitually adopts an objective attitude. Indeed, even a figure like Einstein has said that there are four reasons why he can succeed, and "self-criticism" ranks higher than "curiosity", "concentration" and "perseverance", which is the most important.

To further appreciate the power of self-criticism, think for a moment about where the very "untalented" college dropout Charles Darwin is buried after his death. His tombstone is located in Westminster Abbey, next to the tombstone of Isaac Newton, who is probably the most talented student in history.

There are five simple Latin words engraved on the tombstone, but they contain the most meaningful praise of all the inscriptions - "hic iacet quod mortale fuet", which means "here lies the mortal that once thought unforgivably" (Darwin's theory of evolution once caused a great uproar and was considered by the religious community to deserve going to hell after death).

A culture that treats Darwin so well after death will also develop and integrate psychology properly in a proper and pragmatic way, thus promoting the development of all fields. All those who have this ability and insight should promote this process, because it is a matter of vital importance.

If in many high-end fields, a globally renowned product like Coca-Cola cannot be understood and interpreted correctly, our ability to deal with other important matters is not very optimistic.

Of course, if some of you put 50% of your investment in Coca-Cola stocks, the decision must be made because you have come to the same conclusion as my advice to Glotz through thinking. Such people can ignore my views on psychology because it is too basic for you and cannot be regarded as useful advice at all.

However, for others, if you also ignore my views, I am not sure if this is a wise move. This situation reminds me of my favorite advertising slogan used by Warner and Swasey in the past: "If a company needs a new machine but hasn't bought it yet, it has already paid the price."

Edited by Jeffrey