Red Associates The Moment of Clarity | Christian Madsbjerg & Mikkel Rasmussen | Talks at Google

MIKKEL RASMUSSEN: Hi, my name is Mikkel Rasmussen and this is my partner, Christian Madsbjerg. And tomorrow we are launching a book called "The Moment of Clarity." It's a pretty exciting book. It's about people. It's about how to understand people, how to understand who we are as people, really understand your customers-- not so much what they think they want, but what they really want. But the book is also about how you can sometimes get people dramatically wrong, really misunderstand who we are. And it happens all the time. And I would like to start with a little

story about kitchens. And most of us cook. A couple of years ago I went to a conference called Kitchens of the Future. It was a super exciting conference where people are showing lots of new technologies coming into the kitchen. And there was one presenter from Ikea together with a couple of Japanese technology companies. And they presented this vision of a future kitchen, I think it's supposed to be in 2040. And if you imagine you go into this kitchen in 2040 it's what's called a smart kitchen. So it recognizes you, it has face recognition, voice recognition,

there's laser beams guiding you to how to cut the fish. There's a fridge with herbs in that's grown to your health profile that's in the cloud. And if you look up in one of the corners, there's a little thing called a nanobot, which is basically a machine where you go and you say, I would like a tiramisu, for example. And it basically, out of nanomaterials, makes that cake for you. And I was completely energized by this vision. I said, this is so great. There are still people having big ideas. Until somebody noticed that in 1956

there was a couple of people from General Motors, actually, doing the same exercise. But they were thinking, how will the future kitchen look? But seen from the perspective of 1956. That means, how will the kitchen look in 2006? So now we can evaluate, really. So I want to pay a little film that they made about the kitchen of the future in 1956. Can you play the movie? [MUSIC PLAYING] -But this was a kitchen like none I'd seen. Put a card in the slot and onto the screen pops a picture of just how your dish will

look plus all the ingredients you need to cook. No need for the bride to feel tragic. The rest is push-button magic. So whether you bake or broil or stew, the Fridgidaire kitchen does it all for you. Don't have to be chained to the stove all day. Just set the timer and you're on your way. [MUSIC PLAYING] Tick tock, tick tock, I'm free to have fun around the clock. [MUSIC PLAYING] Jeepers, I'm exhausted. [RINGING] The kitchen of tomorrow is calling me. My cake is ready. [MUSIC PLAYING] -Time for the show. Everybody on stage. MIKKEL RASMUSSEN: I

think what's really interesting to think about is if you look at the core idea of the kitchen of tomorrow as Ikea thought about it and this idea it's exactly the same idea. And the idea is cooking is slavery. Technology can free us from making food. It can do it for us. It can recognize who we are. And simply, we don't have to be tied to the kitchen all day, as they sing in this movie. And it's the same vision you see again in 2006. When we imagine the kitchen of the future it's still a kitchen

that's automated. We don't have to think about it. And it has a lot of technology that actually takes the human condition out of the whole thing of cooking. Now if you're an anthropologist-- we work a lot with anthropologists-- they would tell you that cooking is perhaps one of the most complicated things you can think about when it comes to the human condition or human behavior. That if you think about your own cooking habits, that they probably come from your childhood, the nation you're from, the region you're from. It takes a lot of skill to cook.

It's not so easy. And actually, it's quite fun to cook. There's also a lot of improvisation. I don't know if you ever tried to come home to a fridge and you just look into the fridge-- oh there's a carrot and some milk and some white wine and you figure it out. That is what cooking is like. It's a very human thing to do. And therefore, if you think about it, having anything that automates this for you or decides for you or improvises for you is actually not doing anything to help you with what you want

to do, which it's nice to cook. And therefor if you make technology, for example, that has that core idea about who we are as people that cooking is slavery and the idea is wrong, then your technology will fail. Not because of the technology, but because it simply gets people wrong. And this happens all the time. And you cannot swing a cat these days without hitting one of those refrigerator companies that make smart fridges. I don't know you've ever seen them, like the intelligent fridge. There's so many of them that there is actually a website it's

called fuck your internet fridge-- I'm sorry-- and is a guy who every month he tracks failed prototypes on intelligent fridges. And here you have April, 2011, May, 2000-- you can actually go in today and see are there any failed internet fridges today? My guess is, there probably is. Why? Because basically, the idea is wrong-- not the technology but the idea about who we are, that we do not want the kitchen to be automated for us. We want to cook. We want Japanese knives. We want complicated cooking. And so what we are saying here is not

that technology is wrong as such. It's just you need to base it, especially when you innovate really big ideas, on something that's a true human insight. And cooking as slavery is not a true human insight and therefore the prototypes will fail. There are many interesting ways to think about technology and cooking. For example, molecular cooking like this, where people experiment and broaden what cooking is, and make it more complicated, expands what we can do with cooking, as opposed to automating. So we're not saying there's something wrong with technology but we're saying, sometimes it's a good

thing to understand what your core idea about the human behavior that you want to attack. Now, this is not relevant all the time. This is only relevant sometimes in a company. We have been working with really big companies for over the last 20 years. And sometimes there's a situation where things become really uncertain. We talk about it in the book as navigating in a fog. Here's an example-- this is one of the biggest sports companies in the world. And I was attending a workshop where we talked about the future. And they were presenting sport shoes

and tennis catchers and all kinds of technology. And all of a sudden, in the midst of this big discussion about design, product innovation, consumers, markets, there was a creative director who raised a question that made the room go completely quiet. And the question was, is yoga a sport? And it's a really weird question to ask yourself. But think about this company. This is a company-- one of the biggest sports producers in the world. And if you work there, you are surrounded by sport. People are doing sports all the time. They wear sport shoes, they play

sports, they talk about sports. Even their language has sports metaphors built into it. And the core idea behind that type of thinking is that sport is really about winning. It's about athleticism. It's about winning in the marathons and so on. And that's an idea that this company has also when they discuss in a workshop like this. I could clearly see it. So they would take up a shoe and say, so what should the consumer get out of the shoe? And they would talk about that this shoe will make the consumer run a marathon two minutes

faster. And that's super great. I remember there was even a swimming technology with some stripes on that supposedly would make you do a crawl a little bit faster. Things like that-- and it's great ideas if you want to win gold medals. But what this guy was discovering, slowly it was dawning on him and the [INAUDIBLE] is there's something big we are not getting right. There's something-- I can't put my words to it, but the best way he could say it was to provoke these gentlemen and say, is yoga a sport. And what he was talking

about was not yoga. It was the whole phenomenon around sport that he was questioning. He was seeing that there are now more fitness centers than post offices in every town in the world. He was seeing people doing 24 hour bike races. He was seeing the marathon times coming down, with one hour on average, because everyone now does a marathon. And he was basically seeing that sports was being democratized. And it's not only about winning gold medals. It's also about slimming yourself, feeling good about yourself, and things like that. But he had no way to say

that to the company because he didn't really know how to voice it. And it was such a big problem for him that he really didn't know how to do it. And then in this situation-- that's the situation where we would say, this is the most important point where you need to get people right. If you get people right on this question, you get people-- wrong, sorry, about this question, you get them wrong all the way through. So if you think about your own business-- now we are in Google but you could think about any other

business-- and you have problems that you deal with in your everyday, we would say there are three types of problems. Some of them require that you get people right-- you're really strong in that-- and some of them require that you can just use your intuition, especially if you're really familiar with the problem. So if you look at the three types of problems, we can start in the bottom and say, there are problems where it's not really so uncertain. We've tried it before. We are pretty predictable. And those are called knowns. You can basically put an

algorithm to those problems-- things like, if we put money from this channel to that channel we'll sell this much more. And that's something you can just use an MBA kind of thinking to do. They're good tools and good methods and you don't have to get people so right, really. You can base your decisions on assumptions about people. Then it becomes a little more difficult, more unpredictable, and you go to what we call hypotheticals. And those are you know what the problem is but there are various ways that you could solve the problem. For example, we

are putting more money into R&D but we're not selling more. Why is that? And there could be various reasons for that. Also here there are some good tools and methods that you can use from a business school, for example, calculating your way through it, figuring out how big are things and so on. And then we get to the yoga question. Is yoga a sport? That's not a known and it's not a hypothetical. It's what we call a big unknown, that it's something big you're uncertain about. And this is the point when you don't even know

what the answer is and you've never solved it before. And in the case of the sports company, this was the situation. That to deal with this problem they just couldn't calculate their way through the problem. They had to figure out well, how is sports changing as such? When you're in this situation there's something happen that we have seen in a lot of businesses, which is that we have assumptions about people that we're nearly born with or we learn somehow and they're really difficult to take off. And one of the biggest assumptions about people is this--

sorry, I'll just go on-- that we can be understood as the smallest substances, like atoms. So here's a physician that once said, "Everything is made of atoms, there's nothing living that you cannot understand from the point of view that they are made of atoms according to the laws of physics." And I just have to say, really? Are we sure about that? If you take your own company I could provoke you a little bit and say, could you take this quote and put bits in? Everything is made of bits. There's nothing living that you cannot understand

from the point of view of a bit or a calculation. And there's nothing wrong with thinking this way if you're familiar with what you're doing. It's by far the most efficient way to think about people, that we are basically atoms and you can reduce people to the smallest substance and then understand the totality from that. But when you're in a big unknown this is toxic. Because what will happen is that you get people completely wrong and then your ideas will end up as smart fridges that nobody wants, nobody buys, and nobody uses. Now we have

seen that there is many assumptions about people. There are five I just want to talk about and then I'm going to hand it over to Christian who will give you a little bit of a philosophical background before this. And then we will give you an idea of how to get out of this mess. But there are five assumptions. So think about when you talk about users, consumers, customers, what are you talking about? Very often there's an idea that human beings are first and foremost thinking beings. That means you can understand people by scanning their brain.

That's one very, very common assumption about people, that everything there is to know about you is in your brain. Another assumption is you know what you want. You know your intentions. That means you can go and ask a consumer, so would you like this in red or green? And they would actually know. A third assumption is that consumers-- they're all about options and choices. So what you study is, how do you make choices? So when you go out down to the supermarket and you want to buy a juice, do you want the juice with the

things in or the juice without the little things in. And that's the very, very important thing about consumers. The fourth thing that's toxic is the assumption that your consumers, your customers, your users actually know what they want. So you actually become a slave to their needs. You just ask them, what do you want? Oh, I want a red car. Hey, let's produce a red car-- that kind of thinking. And the fifth one is that people-- because you can understand them from their brain and have access to their inner minds-- that they are the same, regardless

which social situation or mood they're in. These five assumptions-- you may think that this is pretty banal or stupid or something like that-- but these assumptions are at the core of many, many business decisions every single day that we make. When we ask people in a focus group to evaluate a product, for example, it's based on these assumptions. When we go and scan people's brains to figure out whether they like the red logo or the green logo, it's based on these assumptions. When we ask people, can you just evaluate what you want on a survey?

It's based on these assumptions. And I would even have to say, sometimes when we do these big data analyses, it's based on these assumptions, that you can take people and pull them down to what they need to put it together to a bigger question and then here you have the understanding of people. Now this plays out in many interesting places. And here's an example of what can happen. So in many companies what they do is they do these big surveys about what people need and then they try to data analyze their way through this. And

they end up with what's called segments. And here's an example. This is actually a spirits producer. They get us drunk. That's what they do. And they looked at the Asian market and women. And they did a huge data analysis to figure out how many women there are, how old are they, what do they need. They did surveys, focus groups, everything, and boiled it down to four types of people. I'm not going to go through all of them. But one of them was called the modern life seeker. And they figured out those were the people who

had the most money, who loved to drink the most, and who we wanted to go for. And we were asked to go out in the supermarket and help them identify these people to study them further, get deep inside into who they were. But we didn't understand-- my mom, she's not a modern life seeker. I know that. And my sister is not. And my daughter is not. I just couldn't figure out, what is a modern life seeker? And we went out to the supermarket in Bangkok. And in this supermarket-- it's the biggest in the world-- it's

the most instagramed, sorry, shopping mall in the world. There are thick women and thin women, clever, smart, dumb-- there are all types of women. And we asked, could you point out the modern life seeker? And they kind of started sweating and said, she's not here. And you know why she's not here? Because she does not exist. Why does she not exist? Because it's based on wrong assumptions on who we are. And it becomes a tool where you as a company can say, oh our consumers are out here in a nice model and we don't really

have to be part of that. We can just analyze them and tell them what they want. And there are many other examples of this going on. Maybe you should take over here. CHRISTIAN MADSBJERG: So what we see is the same research project in many different ways. So the research project is basically, as we try to write in the book, a Cartesian-- a Rene Descartes-inspired project. Which is that we have access to our inner states. We can see what we want and need. And the mind is us. And the mind is the brain-- so a set

of reductions about who we are. And if we look at the world it's different. And we'll show you a little bit about that. But there's a couple of baseline things we see all the time. The first one is that you can get it down to algorithms. You can create systems for understanding the data that people generate in their activity. And if you take me-- where I work, what I click on, where I'm with my phone, where I drive, and so on-- that's me. That's a very good picture of who I am and the kinds of

decisions I make. The second one is atomized, that you can think of people as self-contained entities, that we are basically individual subjects that stand against objects and give meaning to the world in that way. And the last thing is that we're rational. Everybody knows that we're not rational all the time. But it's something-- and there's been economists that go a little further and say that irrational might be a category we could use as well. But basically, it's the rational irrational model. And we think that's wrong. And I'll show you a picture here to explain what

it is we mean. This is a picture from a project by a guy called Paul Radcliff. And he asked people to take pictures of the best moment in a week, the time in the week that was best. And it's this lady-- she sends a picture of umbrellas. And I think you know this kind of day in New York City where it's soaking wet. And she lost her crappy umbrella. Her umbrella was destroyed by wind. And she tried to trash it. And when she tried to trash it she saw that that happened to others as well.

Which meant that the most absurdly annoying situation of getting completely soaked and losing your umbrella became delightful because it was funny. It's funny that other people were in the same situation. And I think you can also imagine what that situation is like because you've been there. So you're connected to humanity in a bigger way than just rational processes. You're connected to humanity in the way that we understand each other. I was at an art museum in Los Angeles not long ago when I met this guy that was sitting on a bench crying. And he looked

at a big Syrian tapestry from the 1600. And I asked him, so why are you crying? And he said, because I don't feel lonely anymore. I feel that somebody, in a place I don't know, 400 years ago, felt exactly the same as me. So the picture was about paradise. And he'd just lost his mother. And he was thinking, where is she? What's going to happen to her? And somebody in a place completely distant, 400 years ago, had the exact same feelings as him. So he felt connected to humanity and he didn't feel atomized anymore. He

felt connected to something. And that's a fairly deep insight, if you think about it. It is that we are, first and foremost, not thinking things. We're social things. We're geared into worlds, and if you strip us of our world, we make no sense at all. We're not interesting at all. It is how we are in the world that is meaningful. And we navigate our world through familiarity. You know this, I guess, when you go to a city you've never been to before. Everything looks new. Right now the street you go down looks like the street

to the baker or to the cleaner or something like that, because you're so familiar with your own city. But when you move to someplace-- I moved to New York City from Denmark five years ago. And it's only now I understand how extremely Danish I am. When I lived in Denmark I didn't see it at all. It wasn't at the forefront for me. I couldn't see it. In the same way, when you stand in line for coffee, it's only when somebody breaks the rules of standing in line that you understand that there are rules for standing

in line, right? So our familiarity with the world is how we find our way around. And that whole layer is not in the data normally-- the understanding of how we act upon the world and how we make sense of it. In the philosophical tradition they call that understanding, as opposed to knowledge. Knowledge is data in the way that you have a fair bit of data. But understanding is how you interpret that. In the philosophical tradition there's also been the debate about how do you make sense of lots of data. And Francis Bacon, 400-ish years ago,

said that the conclusions will fall out of the data itself. If you look to the big data people, they will often say that we don't need theory anymore. We don't need interpretation anymore. Because we have so much data now that it will conclude by itself, OK? If this is true, you can't do that. You do it based on something. And it's only when you don't have familiarity with something that you need this kind of analysis that we are proposing. We basically are in the world already. We're always already in the world, and we're always already

making sense of it before it even happens. So we know that's a chair without taking our subjectivity and looking at the object and then seeing what it is. We just know it's a chair. And we're very familiar with chairs. So what we say that there are three building blocks you need in order to be in situations where the business doesn't work, where you're not making sense. So if you systematically launch products that gain 1% to 2% market share, you might want to think about it. So the first thing is a humanized mindset. So, a mindset

about humanity that's different than the rational one. The second one is what we call thick data, which is data about our familiarity with the world. And the third thing is what we call non-linear problem solving. And I'll give you a couple of examples fast. The first one is we say, the differences. There's a big difference between properties about something and aspects about something. The property of a woman is that she's a woman. You can say it like that. It's biological. It's pretty clear that you can analyze that. You can use natural science methods to see

that. The aspects about whether she's feminine or not is an aspect. It's a human thing. It's layered into our familiarity with the world. And what we are proposing is that lots of people miss the aspects by only focusing on the properties. And that's what you get when you use natural science methods understanding humanity. Thick data is trying to analyze what does something mean? How are things layered into our behavior? So for instance, if you go to a bar, and you see an attractive person winking to you at the bar, you would know within a second,

without even thinking about it, whether it's suggestive, ironic, critical-- whatever kind of all the options a small movement with the eye can be. Understanding that and the understanding of how you easy gauge whether that wink is suggestive or not-- means, let's leave together or not-- is important for your success at that situation. And it's something you all know but it's hard to analyze unless you get thick data. And the way we do that is we import it from the human sciences. So that is sociology, anthropology, and so on, that have methods in order to do

this. And it analyzes what's below the threshold of awareness. Now Mikkel told you before about sports. At the time, when we're talking about this company that is in the sports industry, they called fitness "sports preparation." If think about that for a moment the reason why it's called sports preparation is, of course, that you prepare yourself to win gold medals. The only reason for going to the gym or doing yoga or anything like that could only be-- if you are in the mindset that sports is about winning-- is to prepare yourself for something real, instead of

just going to the gym. And what we found when we looked at these things was we found what in this case we call it the little black dress phenomenon. But it was basically a fitness measurement tool for women that we found across generations, across geography, which was a dress that was a little bit too small. So it was an ambition, and it was layered into-- the whole reason they did what they did was embodied in that dress. And that's the kind of data that we call thick data. It's not the kind of data I guess

you work with the most, and we're not saying that that's in any way wrong, we're just saying this is another type of data that can be very helpful if you don't have familiarity with an area. So what we call default thinking, hypothesis-based inquiry, answers what and how much, research on what is and has been or is happening right now-- and what we're saying is that there's another type. And we call it sense making in the book. It's an exploratory inquiry. You're not basing yourself on-- you're not trying to test a hypothesis. You are trying to

cast a net and understand patterns of behavior. And in the bottom you can see the difference between correctness and truth. This is a classic Martin Heidegger distinction. It's that there's lots of things that are correct but that isn't true. So for instance, if I ask my daughter, could you please put six plates on the table, she would go and put six plates on the table. And I'll come in and they're all in a stack. And I'll say, well that's not what I meant. I meant around the table with forks and knives and stuff. And she

will say, well six. So it's completely correct. There are six plates on the table. But that's not the truth about how you eat together in a sense. And what we're trying to get to say is that there is a method for getting to that shared, common humanity truth about us. You want to say something? MIKKEL RASMUSSEN: Yes. And I just want to show you how one company works with this. It's a company that many of you know well. It's Lego. And many years ago they were in trouble because they were losing money. But also they

were expanding into territories that they didn't know so well. And somehow they got people wrong. At that time, when we met Lego, they had some pretty strong assumptions about what's going to happen to play. And one of them is, we're to die because PlayStation is going to take it all. Another one was a phenomenon called instant traction. Have you heard about this? The idea is that kids these days-- they have no attention, you can't get them to do anything. So when you go into a toy store, the toy needs to be very noisy and very

easy to play with, because that's the only way you can get their attention. They also had a creativity idea which was called crisp, cool, wow. And that was, anything was evaluated on is it crisp, is it cool, or is what-- nobody knew what it meant. Is it crisp, cool, or wow. So that means you can just do anything. That boys wanted evil-- so you can see when they did Bionicle that there's dark and red and blood and death. And that girls wanted pink-- and you can see that it's pink princess, everything was pink, and so

on. And basically they assumed that because of this the brick has no future. We have to head in another direction. And they did that by launching a lot of new innovations that was beyond the brick-- software and toothbrushes and violent toys and all kinds of things. And it basically got them into trouble. They got a new CEO who at one point said, I think we need to understand, before we take any decisions, why do kids plays and what role do we play in that? And the first step in getting the human condition right, like Christian

was talking about, is not really doing any research or meeting any consumers or anything like that. It's looking at the assumptions you have and trying to change the question. We talk about this as framing your problem as a phenomena. And that's a very academic way of saying it. A simpler way is, try to ask your business question in a way that a person can experience. So for example, the big business question for Lego at that point was, how can we sell more toys? It's a very natural, very good question. It's just that it's not something

anybody experiences. And what they did is change that around to a question which was, why do kids play? It's a very simple little trick but it does wonder. Because you start looking at very different behaviors when you look at why do kids play. It's actually a little tricky, if you look at a kid, why do they play? Jesus, I don't know why they play. They just do it. Yeah, but why do they play? And what Lego did was they spent half a year going out to kids, living with kids, observing kids, figuring out what's their

world like, figuring out parents, figuring out how school works, and trying to go down to that thick data that could reveal why do kids play and then try to make sense of that to find their own future. Now this was a really interesting experience and lots of interesting stories. Here's one of them. This is a shoe worn by a boy in Germany, I believe. And the shoe is 1,000 times more worth for him than a new shoe. And we asked him why. And he says, because it's worn in the right places it shows that I

can do a kick flipper. This shoes is worn in the right places because he has tried a million times to do the trick on the skateboard that makes him stand out in the hierarchy among his friends. And if you look at that, it really means that he does not suffer from attention span or loss of mastery or de-skilling or anything like that. This kid is deeply into one thing and he does it everyday for hours and hours and hours and hours. And what Lego found was all the kids that they met had this deep mastery

of something. They met one little guy who knew everything about sharks. So he was building a shark in Lego and they asked him so what shark is the one with 23 teeth? Because there's one shark that has that. And he knew the whole history of sharks. Now they also found another interesting thing, which was that a lot of kids, when you play with them-- not talk to them-- they reveal a big world of inside knowledge that we don't know as adults. We call it under the radar. We don't know it's there. So here's an example.

It's a German boy who Lego met. And his mum told them that this boy was really bad at maths. He was not good at school, probably had ADHD, and so on. And she was kind of worried about him. And to show that, she had given him a trumpet. Do you think he was playing on the trumpet? Not really. But what he was doing was he was doing something called fantasy football. And we observed that. And he was sitting with a big piece of paper. And then he was in like soccer-- so he's going and Luftkicker

was going-- and he was coming up with these imaginary football teams, imaginary players. And then he would make a statistic, after 90 minutes of playing the game, about who won. But not only that, he would also make probabilities of, if you put your money on Luftkicker against Litana, it's probably a nine to one. So here's a kid where his mom and probably his school and all the psychologists in the world would say, he suffers from attention span. He's not good at math. We're worried about him. But what LEGO discovered was that behind all that, there

was a kid who had so much talent and so much mastery. It's just nobody was seeing it. They took this insight and really thought about, what does it mean for us. And basically they saw three big things. One was kids have mastery and they strive for mastery. Anything that's difficult and complex and deep is great for kids. The other thing-- this was the thing with the shoe and the skateboard-- is that a lot of kids these days are looking for hierarchy. I'm meaning, if you ask any kid, so who's best at maths in your class?

She will say, oh that's Jim. And who's number 17? That's Jack. Ask any European kid, so which Italian player scored the most goals three years ago? They'd know. And so we found hierarchies everywhere, everywhere. So mastery and hierarchy. And the last thing was the sensation of building something big and complex and challenging. If you looked at those three things and just think about-- we're moving into girls' toys, we're moving into toothbrushes, violent toys, stories with a lot of storytelling, and we're move ourselves away from the core experience of building something, creating something. And you look

at the three things that kids really need, which is-- mastery, hierarchy, and challenges. LEGO found, but maybe the answer is just right here in front of us and it's called a brick. Because a brick can give you mastery. A brick can give you hierarchy if you've built something and show other people. And a brick can give you a challenge. And if there was a way we could put that idea into all of the things we're doing, all the innovations we're coming up with, all the products we're coming up with, the way our shops look, the

way our digital tools are going to look-- and they took that very idea of back to the brick and mastery, hierarchy, and challenges and put it into their core offerings. So they created tools where kids could design their own LEGO and get it printed, basically. They created LEGO games that gave you skill and hierarchy and they went into the digital universe with a much bigger precision than they could before. And if you ask the CEO, he says today they're number two toy company in the world. They're really profitable and successful. And not only because of

that but also because of that-- if you ask him, he would say, well there are two reasons. One is that we basically did the hygiene on the company and we now have cost control and we know where we're making money. And all that you can learn in am MBA. So that was one thing. And the other thing was that now we understand why kids play-- hierarchy, mastery, and challenges. And we can put that into everything we do. OK, so that's the story about how to do that. And in this book we say there is a

generic method behind this that any company could learn, any company can do, if you do it right. If you start by framing your question as a phenomenon, then you dig into how people really are, how they really live, and get a thick understand of that. Then you find the patterns in that and say, what are the interesting patterns? Then you say, what are the consequences for our business? And then you frame that as an idea that can create impact for your business. That's basically the simple way of doing it. It's really simple to say. It's

not so easy to do. But it is simple to say, because I just did it. OK so really what we are saying is, we think that in an age of a lot of big data and a lot of rational thinking, there is a need also for getting a little bit of humanity into business again. And there is a science of understanding people. It's called human science, anthropology, social science, political science, parts of economics, literature, linguistics-- that has 100 to 200 years' tradition of understanding people. And all they're really saying is, there is something about us

that's not on the surface, they can only be discovered if we reveal it. And I think that one of the most emotional moments of mine when I wrote this book was when I was listening to a song-- I write and listen to songs at the same time-- and there was a song by Tom Waits which is called "San Diego Serenade," and he sings about how he never saw the morning until he stayed up all night. And I can remember that from when I was a teenager, the first time I went out to a party and

came home and the bird were singing, it was in the summer, and I could just feel the sensation of what a morning really is. I never saw that before. And that's what he's singing about. He sings about, I never saw the sunshine until you turned out the light. He says, I never saw my home town until I stayed away too long. And then he's saying, I never heard a melody until I needed a song. And that's the very simple message that we have for you guys, that there is a way to get both the top

layers of our experience as humans but also get to the deeper layers. And both are needed in the future. Thanks a lot. CHRISTIAN MADSBJERG: What do you do now? Any questions? AUDIENCE: I have a question. Hi, thanks for joining us. Can you talk a little bit about how you identify the right question to ask? So sort of the process of getting to the why do kids play-- what's that like? CHRISTIAN MADSBJERG: See, this is a really good question. And it's interesting because we got that question a few times before. And the literature doesn't reveal anything.

So our main inspirations, which are German philosophers basically-- so Martin Heidegger-- later on French philosophers, have no method to this. The way we do that is we turn it into a verb. So we say, what's the main, most banal, we call average, everyday experience that people have here. And then say, what might that be like? So we say, what's the average, everyday practice that people have, and are there interesting and juicy questions that once you think about it-- once you think about play, I mean, I know kids play. But I don't really know why. And

if we don't know why, how can we ever, ever produce toys that are helpful in that case? Why do people work out? So it's so dumb and average, everyday and intuitive that people, in the beginning, feel, well what does mean? And the way that the traditional talks about this is as a phenomenon. That's also why the philosophy behind this is called phenomenology. So it's-- what's the human phenomenon that we can all share and all experience and that's so close to us that we never see it. It's like wearing glasses-- maybe not Google Glasses, but any

old glasses-- that you don't think much about. So like I said before, when you go out to what is called a mini kitchen-- which is a fairly large kitchen-- but if you go out there and there are many people around the coffee machine, there would be a line. There's somebody that's next to get coffee. But you only see that once somebody breaks it. So other than that, it just works as our everyday dealings in the world. And that's exactly what we're interested in. So we're interested in the things that are so everyday that we don't

see them. And there's a German filmmaker called Wim Wenders that made a movie called, "Far away So Close." And that's the whole point. It's so close to us that it's far away. And it's because we can't think about those things all the time. You can't think about how do I stand in line? You just do it. Or how do you drive a car-- if you move to New York City-- I moved to New York City and I'm still trying to figure out how traffic works here. People speed up at the wrong times and break at--

and they get annoyed with me. I don't know why they get annoyed with me. A space between two cars is an opportunity to get ahead and get to the red light as fast as possible. AUDIENCE: Just don't drive. CHRISTIAN MADSBJERG: Exactly. Exactly. So places have styles. And I guess, in a couple of years, I might figure out how it works . And I'll start get annoyed with people when they break those laws. But I don't think any of the people in the system would ever think about, what's the style of driving in New York City.

It's just what happens, right? And that's exactly the object of study. So we study familiarity, how we are familiar with things. And familiarity withdrawals. In the sense, the classic example is a hammer. Hammering-- the last thing you want to do when you hammer is think about it. You want to be-- you will hit your hand and so on. And that is when hammers are most hammers, is when they are engaged with skillful people using it. That's when hammers reveal themselves. You can also look at the properties and say, it has a wooden shank and a

metal blob at the end and so on. You can decode it from a natural science perspective, how much it weighs and so on. But it doesn't weight anything, except if it's too heavy. It's just perfect when you use it. In that sense, the hammer withdraws from our experience. And hammering becomes the experience, in a sense, right? Does that answer the question? OK, good. So again, familiarity. AUDIENCE: All right, so a question from here. So when I was listening to your talk, first with the example of the kitchen and later with the LEGO example, I noticed

that the examples were all very male centric. They were about soccer. All the kids in question were all boys. So which made me think, when you're doing this process and you're asking about the why, how do you guard against your implicit biases finding only part of the answer. CHRISTIAN MADSBJERG: So that's a methodological question that you can't get out of. And it's called the hermeneutic circle. It's basically, in order to understand something, you need to use yourself and your own experience. A Shakespeare comedy isn't funny unless you use your own experience. Because-- yeah well, that's

obvious. So the way that we try to do this is to work with our biases, be aware of them and try to adjust for them as much as you can, but accepting that you can never-- there is no view from nowhere when you study people. When you study quarks and atoms and bits and bytes or something like that, there is a view from nowhere. And the natural sciences is a pretty good example and a very successful example of that. But for human sciences, your insight, the interpretation yourself, so you have to work with it and

be honest, basically, about your own biases and so on. Now we just did a study about women and drinking, which are two very exciting topics. And we found that women are starting going out, in places like Russia, China, Brazil, where they never, ever went out with their friends and so on. And it turns out it freaks out the men. They sit at home and don't know really what to do. And a whole new culture is starting, especially in Asia it's quite prevalent and it's a whole new market and so on. So it's not just men

we study. I guess the examples were biased in that direction. But in that case, you need to, again, work with your own assumptions and your own biases as much as you can. And there is no view from nowhere. [INAUDIBLE] MIKKEL RASMUSSEN: When Christian talked he talked about three things you need and one of the last one was called non-linear problem solving. And it basically means exactly what you are talking about now, which is you cannot take your own ideas out of the picture. That means this type of analysis will never be a completely 100% percent

exact analysis of how it always will be. It will be a hunch about how something works. Like when you go in and see a movie, and you talk about it afterwards, you have an interpretation of that movie. But we are saying is if a company can have a conversation about the customers they are serving and start making interpretations based on deep data, it's much, much better than having a numbers-based and very thin data because it gives them an insight. But you have to place a bet. It's not like a one-to-one where you can say, oh

they all have red shoes. Let's make red shoes. It's not like that. I hope that makes sense. CHRISTIAN MADSBJERG: Yeah, and you can say that there's-- you can go to school. And anthropology is a tradition that's 100 years old which is about understanding culture. And just like you wouldn't ask somebody that's not an engineer to build a bridge, it can be helpful to have that kind of training if you want to do cultural analysis. But that doesn't give them-- anthropologists-- a view from nowhere, either, in the sense of natural sciences. Oh, sorry. AUDIENCE: Sorry. When

you guys are working with leaders who are so focused on the bottom line, what's the persuasion conversation like to say, you're focused on this question, but the actual one is like, why play, instead of how to make more money? CHRISTIAN MADSBJERG: So, first of all, it works. That tends to help. But it feels intellectual to them. It feels non-familiar. It doesn't feel familiar to start talking about lived experience in this kind of complex way. But if they're in enough trouble, they tend to listen. So a healthy crisis is always a good sign. And you can

say that the LEGO company had, at that point that we're talking about here, lost around $300,000 a day for 10 years. That makes people start listening a little bit. And it's a private company so it's-- they were in trouble, so that tends to help. MIKKEL RASMUSSEN: I also think we've experienced, when we talk especially to people pretty high up, that there's a kind of fatigue with the tools they have available. There's a fatigue with the way strategy is done, the over-quantification of everything, the million PowerPoint show, how all the strategies end up with the same

idea that we need to fight our core, we need to go into new areas, and we need to build capabilities. It's always those three things. It doesn't matter whether it's soap or [? tennis cases ?]. It's the same strategy. And we can sense that there's time where those discussions-- and I think many leaders are looking for something new, something that is deeper and more inspirational, basically, I think. CHRISTIAN MADSBJERG: And I would say, I'm surprised by how complex thinkers some of these leaders are, actually. Which is a nice thing. That if you are at that

level, there's a reason why you're at that level. And you have bandwidth enough to deal with many things at the same time. So that's very positive, in a sense. Thank you. MIKKEL RASMUSSEN: You have a question. AUDIENCE: Yeah, so my question is around thick data. And I think guys describe qualitatively what it was, I guess, in your own style. But before you had this dichotomy of it's not focus groups, it's not explicit questions, it's a little more tacit or a little more subtle. And I was wondering how do you go about collecting that thick data?

Or what's that process like? Because it seems more subtle and a little more responsive to the environment. And for example, with the playing with kids example, it wasn't just observing them or taking notes but it was also the process of actually playing with them and maybe putting yourself in their shoes a little bit. So I was wondering if you have any thoughts about that methodology on a larger scale. CHRISTIAN MADSBJERG: So anthropology has developed a tools set called ethnographic data gathering from the 1920s and on. And it's basically largely misunderstood in business today. Because it

means in-house, in-context interviews. So interview is one thing and what we say and so on is important, but it's also important what we do. And so what we normally is say is, we're not interested in people, really. We're interested in worlds. And a world has people in it, for sure. So let's say the world of cooking, or the world of business, or the world of Google. They're all-- or the art world. They all have-- it's not a thing. The art world is not a thing. It consists of galleries and artists and pencils and paper and

canvases and all sorts of things. And it has roles in there, so people that feel they're artists. And it has identities. And it has money. It has all sorts of things. In order to understand a world, you need a hook into that world. And the way we do that is through getting people and seeing how they deal with things and how they do the things that they do. So it's not that they can-- I mean, they always lie to themselves. We all like to ourselves all the time about, I need to cook for my children

all the time and then I can't find my pots and pans. That sort of situation. And we just try to cut through that by saying, individuals are less interesting than worlds, the worlds of people. So what we study is not individuals. It's world. So in a sense-- Margaret Thatcher used to say, there is no such thing as society, only individuals. We say the other way around. We say there is no such thing as individuals, only societies. You are what you do and the way you do it, but also because of all these other people that

deeply influence you. And you might feel that you have rational decisions on what you do. But you don't. You make all sorts of decisions because of your surrounding and because the world you're in. Heidegger calls it the one. One does this and one does that. That's most of the time. We do things because that's what one does. One gets up in the morning. One asks questions when it's uncomfortable that nobody's asked questions-- that sort of situation. And that's exactly what we study. We study how people live in worlds and how those worlds interact with them,

in a sense. So it's observational, but it's with a theoretical framework behind it, in a sense. AUDIENCE: Thanks. CHRISTIAN MADSBJERG: Did I answer the question? AUDIENCE: Yeah, thanks. CHRISTIAN MADSBJERG: Great, thanks Good? Thank you.