Drew Boswell

a place for us to share ideas, talk about life, and learn together.

Cutting the Rope: Sunk Cost Fallacy and Leadership

images1In economics there is a concept called the sunk cost fallacy. A “sunk cost” is money that has been spent and there is no way to get it back. For example, if you were to buy a ticket to a football game only to discover that it is going to snow (100 percent chance). Having discovered these atmospheric developments you know you will not enjoy the game. You have spent the money and there is no way to get that money back and you know that you will be miserable if you go.

The “sunk cost fallacy” is where you decide to go to the game anyway because you feel you have invested too much into it not to go. A common way of saying this is “I want to get my money’s worth.” You go to the game in a blizzard knowing you will hate it because you have spent “too much on these tickets not to go.”

You commit the sunk cost fallacy when you let unrecoverable costs influence your decision-making. You allow yourself to develop a false notion that you will recover the loss if you proceed.

The fallacy is that instead of looking forward and making your decision based on a realistic outcome; instead you look back to investments (money, time, emotion, effort, etc.) you have already put into the project.

Another common way of expressing this idea is “throwing good money after bad.” The idea that if I keep spending money on this effort then eventually it will pay off, even though it has already shown to be a loss. In fact, the more (time, energy, emotion, effort, etc.) that you have put in the harder it is to cut your losses and walk away.

So if you find yourself in a situation where you feel “stuck” and recognize that you may be falling into this fallacy ask yourself the following questions:

  1. If you had to do it over again – would you have taken the first step? If you answer is “no,” then cut your losses and bail.
  1. Can your present resources (time, money, emotion, effort, etc.) be spent on something more beneficial instead of remaining with the present situation? If the answer is “yes,” then cut your losses and bail.
  1. Is this situation keeping you from something else? You see this question in relationships. Sometimes we find ourselves in a relationship where we know it is taking us nowhere and we see constant flaws in our partner but we stay in the relationship anyway. Why? Because of all the time we have already put into the relationship. The longer the relationship continues the more entangled you feel.

Sometimes walking away is the wisest decision we can make.[1]

There is also a psychological tendency to favor “not losing” over “the importance of gaining.” Humans tend to favor hanging on to what they have (not losing) rather than taking a risk of making changes in their lives (gaining). They would rather stay in a poor dating relationship (if they have been in it a while) rather than take a risk to be single and finding someone more comparable.

We also don’t like the idea of looking foolish, that we have made a bad decision, or have wasted resources. Instead we push on into even more bad decisions and even more wasted resources. We have the false notion that it will get better . . . eventually . . . if we just keep going. But realistically, the longer you continue to stay with a bad decision the more foolish you look – even in your mind you make be thinking that it is noble, honorable, enduring, etc.

Unknown4With our decision-making, only future costs and benefits matter. So back to our example of the football game: Instead of going to the game (even though you have paid an exorbitant amount for the tickets) you decide to stay home instead. You are rested, warm, and can watch it on your television. Going to the game will not recoup the money you have already spent on the tickets. You have now cut your losses, and are relatively happy.

In leadership, there will be times when you have led your people into a project or effort and things are not looking good. Everything is going “sideways” and your trusted sources are telling you that you need to do something. You could continue to move forward or stop the effort. When this happens (and it will eventually) think about the sunk cost fallacy. Are you making a decision to continue to move forward because of what you have already invested (that’s the fallacy) or do you truly see the benefits outweighing the costs moving forward?

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Click here for more information on “sunk cost fallacy”

I got the idea for this blog entry from listening to Jacob Goldstein and an NPR piece on Planet Money.

[1] No, I am not talking about you married people out there, or if you have kids. You are morally obligated to stick it out.

Steps of Grace; Genesis 1

Creation and My Mother

UnknownAs I sit in the waiting room while my mother is having surgery on her foot, I was reading through Genesis 1 in the Bible. As I read through the passage the following questions came to mind, “Why did God not just create everything in a single moment? Why spread it out over six days? Why not create the entire universe or ‘creation’ in a single instance?”

Genesis 1 “In the beginning, God created the heavens and the earth. . . And God said, “Let there be light,” and there was light. 4 And God saw that the light was good. And God separated the light from the darkness. . . . 7 And God made the expanse and separated the waters that were under the expanse from the waters that were above the expanse. And it was so. 8 And God called the expanse Heaven.3 And there was evening and there was morning, the second day. . . “ and so on and so forth for all six days of creation.

It could have been to show the importance of how the sky or heavens are above the earth, and therefore attach some kind of theological significance; or, to show the separation of light over darkness, etc.… But couldn’t we just discern these things from the completed creation? I think so.

I believe that God broke creation down into steps or days to show a process. He desires to move from one thing to another, from one moment to another moment. Time had never existed before creation, so His ability to show process is significant. He gives order and how elements work together in creation – but in time these elements change how they work together. In eternity there is the eternal present, and any reference to time is insignificant.

Creation Teaches Us About Relationships:

1)   Creation teaches us that every aspect of creation is important and significant. It is given its own day, or part of a day in the creation account. Each day therefore is important. Each aspect of creation is highlighted.  Man was created with a need for a woman. Creation was created with a need for something to have dominion over it. We are linked together, and each part is important.

2)   There is the development of marriage and relationships, which develop, grown, deepen, and change over time. Having been married for over fifteen years, I love my wife differently than how I loved her the day we were wed. My relationship with my mother has changed as well. She is still my mother, but how we relate to each other has changed over time. She was once my caretaker and provider, now she has moved to friend and dearly loved person that I find myself helping to care for.  Not only can you know a person (which is a great blessing), but at different stages of the relationship you experience life differently with them. We can only speculate as to what a perfect marriage would have been like, and how their love for each other would have grown deeper over time apart from sin. Or as parents and children would have grown to love each other in a perfect Eden.

3)   God would come in the cool of the day and speak with Adam and Eve. This shows that God intended for mankind (His children) to have an ever-changing relationship with Him as well. The time they would spend together would help them to love Him more, and to understand Him at a deeper level.  He has designed us to take in information over time, in segments, instead of some kind of instant download as in a Matrix movie.  In many ways the work we are to do in this life is the work of deepening relationships with others and our God.

4)   God, in this time with mankind in the cool of the day, would show them their purpose, responsibilities, and how to work for/serve God in such a way that brings Him glory. As a minister, parent, husband, friend, son, etc. I have grown in my knowledge of how to bring glory to God with my life. I am not as faithful to that knowledge as I would like to be, but it is true that God teaches you how to live for Him over time. There are even specific things that we need to learn at different stages of life.  Stages and processes allows mankind to learn, grow in depth of love for others and God, and to experience life differently.

5)   Lastly, I believe that God’s grace is shown to us in the creation account. There were seven days where everything was perfect, but it would not be very long before sin entered into the world. But the days don’t stop, the sun doesn’t stop shining, and the fish still swim in the sea. Life continues onward. Every day you get to start over. Every season you can plant again (even if the previous year was a disaster). Every year brings new opportunities to learn how to live life differently.

I am thankful for my mother, her provision, her friendship, and continuing love. I am also thankful for God’s Word and how it allows us to see life through His perspective. I am thankful for another season of life to know new people, and to experience the older ones at a different level.

 

 

 

Reaching The Next Generation

28086ccc0b8b0b14ffdafbf23edb932b_lI just finished a book by Reggie Joiner, and in his book Zombies, Football, and the Gospel, he says,

“In pre-internet generations, information was scarce. Those who succeeded were the ones who could gather it the fastest. The company with the best data and the library with the most books won. But today, the rules have changed. Collecting information is no longer the goal. Now the greater need is to connect information, to sort ideas, to filter concepts and give content a better context. Those who win today are not as focused on collecting information as they are on connecting information.”[1]

It is interesting that there has always been mankind’s passion to tell and to hear a story. In my lifetime I have seen a swing in fascination of seeking to gather limited information to the next generation seeking to connect with limitless information.  This generation’s challenge is to sift through seemingly limitless information that has not been edited, is biased, and cannot for the most part be verified.  I still do not like to read a book on my ipad. I like the feel of the paper, the smell of the printed page, and the weight of it on my hand. But I know that my kids will end up not valuing my library as much as I do because they can access the same information on the internet for free, without having to dig through books, and without having to store them on space wasting shelves. The entire library of the world fits in palm of their hands.

Think of how our children engage in activities, especially when seeking new information. They have never lived a day where information has not been a couple of clicks away. They had some kind of information gathering device in their hand since they were old enough to hold it. Information about how to work a yo-yo, fold a paper air plane, or answer their questions like “what is dark matter?” is instantly available – complete with a high definition video, commentary, viewer comments and suggestions of how to do it differently or better.

So how do we reach our children who have access to limitless information? If they have an interest, couldn’t they just look it up?

Tell The Story Well and With Imagination

1)   We reach them with what mankind has always loved (and still does today) – a good story. We don’t teach and tell the story for the passage of information alone, but for showing how characters dealt with context. Today’s teachers must drawn them with curiosity and imagination. The Bible is so powerful because it reaches to the core of who we are and how we were made. But the storyteller must be prepared and put their heart into the telling.  We can deal with real life situations and put ourselves there to learn how to live.

We have all had a teacher who made us care, or cry with compassion, or dare to dream what we thought was impossible. And we have all had the teacher who had taught the same class, at the same desk, the same lesson, for so many years. The lessons felt dusty, stale, and inspired no one to greatness. The difference between the two was a good storyteller.

We live in a day of Disney, Pixar, ipads, and 3D televisions. People expect the story to be told with conviction, power, and careful thought toward details. Most of us do not have a Disney budget, but it is amazing how much imagination can be sparked with just a little experimented effort and boldness.

But we must also understand that how we tell the unchanging story must change. Jesus looked around and used grain laying on the ground, pointed to pilgrims walking in their white garments, and countless other teaching illustrations right there in front of the crowd. He was able to use their culture and surroundings to illustrate an abstract idea.

We must reach out into modern culture and into their worlds to teach them timeless true principles. Our children’s worlds involve books they are reading at school, movies they watch, video games they play, and technology they hold in their hands. As a teacher we must enter their world, not expect them to enter into ours.

Show Them How To Use God’s Word As A Truth Filter

2)   We use the Word of God as a filter to this limitless information. The word of God speaks to me as I take in (or should avoid) certain information. It throws up “red flags” within my spirit that alerts me to falsehood and deception.

Psalm 119:105 “Your word is a lamp to my feet and a light to my path.” God’s Word allows us to take our steps in this life with confidence, and with clear direction. Our children must understand that not everything they encounter on the information highway is true, right, or worthy of their time. They must know that God’s Word is paramount to anything else they may “learn.” So we take all gathered information and when it does not align with God’s Word it is thrown aside as falsehood.

2 Timothy 2:15 “Do your best to present yourself to God as one approved,a worker who has no need to be ashamed, rightly handling the word of truth.” One of the most challenging tasks of a teacher is to show students how to use the entirety of Scripture to focus the entirety of life.

iPad-KidTeach Them in the Context of a Loving Relationship

3)   Starbucks discusses the importance of a “third place.” There is home, work and the “third place” that Starbucks hopes will be where you buy their coffee and hangout. It is there that you laugh with friends, meet with business associates, discuss a book, etc. The church should meet people’s need for a “third place.”  We have to design our times together so that relationships can be fostered and developed, not simply a dumping of information with little interaction with each other.

Our ability to tell the story and to teach God’s Word is in the context of relationships. The old saying, “they don’t how much you know, until they know how much you care” is very true. When your students, children, neighbors, etc. know that you genuinely care for them then they will listen to what you have to say.

So how do we reach our children who have access to limitless information? We tell the story with excellence, showing them how to properly use God’s Word, in the context of a loving relationship. All of these three tasks have their own challenges, but the saints of old have overcome them and so shall we. The good news is that even if you need a pre-teen to set your DVR, that preteen still needs and desperately desires to be loved. Even though the children can access information and communicate via social media they still have been designed by their Creator to need actual loving relationships with other people. Let’s make the church the people and place where children can learn the truths of God and discover an eternal love from God.

[1] Reggie Joiner, Zombies, Football, and the Gospel (The ReThink Group; Cumming GA, 2012) 143.

Staff Members and the Support of Their Church

First Baptist Church Valdosta has an interesting and wonderful tradition. When the church goes through the calling process of hiring a new staff person the candidate goes through a series of meetings where he meets with various committees and groups of people.

Eventually, on the night of the church vote there is an option for discussion by the congregation and the candidate is then asked to leave the room. The church votes, typically unanimously, and the candidate is then asked to return.

Here’s where the tradition becomes interesting and wonderful. When the candidate enters the room there is thunderous applause, smiles, and cheers. The candidate enters with thoughts of uncertainty, apprehension, and unknowing only to be met with great encouragement and support.  Then the congregation lines up to shake his hand and give him words of encouragement. What a wonderful way to begin a ministry; to begin with unanimous support and a great show of love.

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Why Staff Members Need the Support of Their Church

1.  It is a symbiotic relationship. The Lord gives churches to pastors and the Lord gives pastors to churches. If both love each other, then there is peace, mutual growth, and the church accomplishes it’s God given purpose. (Matthew 22:36-40, Matthew 28, Revelation 2, etc.) When there is disharmony, distrust, a lack of submission, or when the relationship breaks down, there is only trouble.

2.  It is a trusting relationship. Often times when a church hires a new staff member they travel great distances with their families to serve the Lord and the congregation. The new pastor must trust that the church will take care of him and his needs, and the church trusts that the pastor will do his job and do it well.

3.  It is a growing relationship. Just as congregations go through stages of growth, maturity, and changes so do their pastors. Men of God are constantly changing. While their essential theology may not change, their philosophies of ministry, ability to handle difficult situations, abilities to minister to other people, and countless other life lessons that God teaches all of His servants does change. A pastor and church change over time (sometimes for the good, sometimes for the bad).

4.  It is a relationship. As with all relationships both sides have to put forth effort for it to work. Most pastors that I know work countless hours, do tasks few want to do, and truly love their jobs. Most churches have a desire to do something great for the Lord and are looking for someone to lead them. When both work together, “even the gates of hell can not stop them.” This a special blessing from the Lord.

Your church staff needs to know that you are behind them. For one young man, his family,  and a church in South Georgia it all began with thunderous applause.

"For by grace you have been saved through faith." Ephesians 2:8

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