Wednesday, September 14, 2016

What We Need to Turn Goals Into Lasting Changes

The last post took a look at the importance of prioritizing our goals and the activities that help us pursue our goals.  An excellent post from James Clear discusses the importance of habit formation, so that the changes we seek become internalized parts of ourselves and built into our daily routines.  The post cites evidence that such habit formation is most likely to occur if we structure our pursuit of goals, specifying what we'll do each day, when we'll do it, and how we'll do it.  Interestingly, however, we are most likely to turn our specific plans into habits if we focus on one goal at a time.  Doing one new thing the same way over many days is much more effective in developing new habits than trying to do many new things at once.

Clear cites research that suggests it takes over two months of repetition on average for a behavior to become truly internalized and automatic.  That's a significant period of time (and commitment) and helps explain why relapse is so common among people seeking changes.  If we do not sustain consistent effort over time, the new behavior does not become a consistent part of us.  In those first days and weeks of effort, habits are like cobwebs--easily broken.  It's only with significant repetition that they gain the strength of cables.

So there's a chicken-and-egg problem here.  We need repetition over time to build a habit, but it's precisely the absence of the right habits that make it difficult to repeat activities over time!  How can we become better at the process of habit formation?  

At root, there are only two reasons for devoting the resources to making changes:  extreme fear or profound inspiration.  We will change if we absolutely need to:  if the consequences of not making the change are so scary and aversive that we'll do anything to avoid them.  That's how alcoholics change after hitting bottom; it's why people who could never diet suddenly make big shifts in eating after a heart attack.  Fear creates a sense of urgency.

But the sense of urgency can also come from very high levels of inspiration.  We can become so energized and excited by a potential outcome that its pursuit becomes our absolute priority.  That's the motivation that keeps the entrepreneur doing the right things, or the Olympic gymnast.  It's not about being pushed by fear, but being pulled by an ideal.

The bottom line, however, is that we need a sense of urgency to keep doing something, the same way, for over two months.  Urgency is the great missing ingredient in most change efforts.  This is why goals, to be achieved, must be meaningful, not mere shoulds.  If a goal is a mere desired outcome that finds its way onto a to-do list, it will neither inspire the fear nor the inspiration to become an urgent priority.  Inevitably, competing activities will take over and we'll become a victim of relapse.

This, ultimately, is why setting and pursuing multiple goals doesn't work.  Once we dilute our goal-setting and pursuit, no one goal sustains the specialness--the sense of urgency--needed to become an automatic part of ourselves.  We only change when change is truly important to us...when it becomes a need and a must, not just a preference.  If we're looking to make changes in our trading, finding the one change that will make the greatest difference and tapping into the urgency of making that change is the best way to turn our best practices into robust, best processes.

Further Reading:  Three Best Practices of Best Traders