Second-Order Thinking: What Smart People Use to Outperform

First-order thinking is fast and easy. We look for something that solves the immediate problem without considering the consequences. 

Second-order thinking is more deliberate. You think in terms of interactions and time and consider the subsequent effects of an action. This way of thinking helps you realize that, despite our intentions, our actions can have unintended – and often devastating – consequences. 

Everyone does first-order thinking, but only a few use second-order (or third-order or higher) thinking. Using only the former means getting the same results as everyone else. Using the latter means seeing things that others can’t see.

Thinking about the (unintended) consequences of (your) actions thus achieves two things:

1. It can help you avoid negative consequences, you otherwise wouldn’t have known about…until they had happened.
2. It increases your odds of success because you get better results and your odds of outperforming others because you think farther ahead than they do.

3 ways to add this way of thinking to your life:

1. The easiest way: always asking yourself “And then what?” Consider not only what it means for yourself, but also for others (and what their reactions will be).
2. Think through time. What do the consequences look like tomorrow? Next month? In 10 years?
3. Create a template, a table or use a (digital) whiteboard to list the first-order, second-order and third-order consequences of the actions at your disposal. Colour each consequence red if they’re bad and green if they’re good. This quickly shows you how the same action may seem good at first, but makes the situation worse over time.

A lot of extraordinary things in life are the result of things that are first-order negative, second-order positive. Just because things look like they have no immediate payoff, doesn’t mean that’s the case. It only means that you’ll have less competition if the second and third-order consequences are positive because everyone who thinks in the first order won’t think things through.

How to use Second-Order Thinking

First-order thinking: “I’m hungry [problem], so let me eat these chocolate chip cookies [first-order consequence].”

Second-order thinking: “I’m hungry [problem], so let me eat these chocolate-chip cookies [first-order consequence]…and worsen my health and physical condition [second-order consequence]. Let me grab a healthy snack instead.”