Business and psychology are more closely interrelated than what is usually presumed. The success in business to a great extent depends on understanding the human psyche. Entrepreneurs across all spectrum can, therefore, study psychology to understand the minds of their customers and team dynamics, which are crucial for success in any endeavor.
Why Entrepreneurs Should Read Psychology Books
Business and psychology, at their core, deals with people. While psychology gives us insights into the human mind, businesses use this knowledge to motivate their employees and understand consumer behavior to scale up their sales.
In the words of Darren Kaplan, the Co-founder, and CEO of the analytics firm HiQ, “When you understand human behavior, you improve your chances of making your business succeed.” So, at its heart, business is all about using the right strategy for motivating employees, making a connection with customers, or influencing an investor to believe in your project.
Understanding our own mind is also crucial to create that positive mindset that helps us forge ahead in difficult times. Therefore, a basic knowledge of psychology can be valuable for any entrepreneur. Here are 10 psychology books that every entrepreneur should consider to read.
10 Psychology Books for Entrepreneurs
Thinking, Fast and Slow, by Daniel Kahneman
Penned by renowned psychologist Daniel Kahneman, this book is a must-read to understand how humans think. Kahneman has answered this age-old question by elaborating that the human mind is composed of two parts – an instinctive and primal part, and a critical or rational part.
According to Kahneman, the instinctive part of our mind makes us think fast, while the other part, i.e., the rational part is associated with slower, but more logical thinking. Fast decision-making is usually based on intuition and emotion.
Kahneman then goes to on to explain the strengths and drawbacks of fast, intuitive thinking. Thinking, fast and slow will enlighten you on when to trust your intuition and when to rely on the rational, logical thinking for better decision-making. The book also helps to understand the cognitive biases and their overwhelming effect on our day-to-day decision-making.
Influence: The Psychology of Persuasion, by Robert Cialdini
As the name suggests, this book will give you insights into the psychology of persuasion. The Author, Professor Robert Cialdini’s theory of influence is based on six key principles, which he choose to call “weapons of influence” in his book.
These 6 principles are reciprocity, commitment and consistency, social proof, authority, liking, and scarcity. The book offers an in-depth understanding of these 6 principles, as well as how to master them to become a skilled persuader.
An understanding of how people try to persuade each other can be a game changer for business negotiations and marketing. If you find it difficult to convince and persuade people despite your best efforts, this book is a must-read for you.
Strangers to Ourselves: Discovering the Adaptive Unconscious, by Timothy Wilson
Backed by strong research and filled with philosophical debates, Strangers to Ourselves is a wonderful book that throws lights on how the unconscious mind affects how we feel, behave, and make decisions, and how most of us remain unaware of this fact and thus, fail to realize who we are.
In this book, the author Timothy Wilson takes us on a journey to discover ourselves by understanding the nuances of our unconscious mind, which in reality, is capable of influencing many aspects of our personalities than what was previously assumed.
The unconscious mind can have an all-pervading effect on what we do or feel and an understanding of it can help us realize our true potentials. The author, therefore, illuminates us on how to discover our unconscious selves in his extraordinary book.
Emotionomics: Leveraging Emotions for Business Success, by Dan Hill
For far too long, emotions have been undervalued in our culture, while rationality has always been overvalued. But research in brain science has revealed that emotions play a much bigger role in decision-making than what has been presumed so far.
Emotionomics, penned by Dan Hill, is a book that dwells on how to leverage emotions to get a competitive advantage in the market. It also analyses the role of emotions in the workplace and how an emotionally engaged workforce can give better productivity and a competitive advantage to a company.
Consumerology: The truth about consumers and the psychology of shopping, by Philip Graves
While drawing our attention to the drawbacks of the popular market research findings, Consumerology gives us a peek into the minds of the buyers. The book reveals the psychological games played by successful sellers to manipulate their customers and trick them into buying things they actually do not want to.
At the same time, the book highlights the unreliability of the findings obtained from conventional market research methods like questionnaires and discussions in a group. It gives examples of product failures despite the use of extensive market research, as well as instances of successes achieved even after ignoring the conclusions of such research. To sum up, the book offers a fresh approach to understand consumers better.
The Score Takes Care of Itself: My Philosophy of Leadership, by
Known as the creator of West Coast Offense, Bill Walsh was the acclaimed head coach of the San Francisco 49ers, who not only transformed the football team but also altered the way football is played. The Score Takes Care of Itself is the leadership guide from the legendary coach, compiled by his son and Steve Jamison.
The book discloses the simple, yet powerful leadership strategy employed by Walsh that stresses on reposing belief in people, professionalism, organizational ethics, and assessment of one’s vulnerabilities.
The book also reveals that by concentrating more on the process and less on the result, we can get better results. And this principle applies to all areas, be it sports or business.
The Power of Habit: Why We Do What We Do in Life and Business, by Charles Duhigg
Charles Duhigg, the investigative reporter for The New York Times, has authored the book The Power of Habit after reading hundreds of scientific papers and interviewing their writers. His book, therefore, offers a look at the findings on habit formation and change from research carried out in the fields of social psychology, clinical psychology, and neuroscience.
With fascinating anecdotes, the author points out that habits can be changed and once you believe in it, you get the freedom to transform your life by making positive changes in your habits.
The knowledge of habit formation and change can not only help individuals but also corporates. By tapping into this knowledge, one can influence employee behavior to make them more productive for the organization.
Mindset: The New Psychology of Success, by Carol Dweck
After devoting several years in the study of success and achievement, the world-renowned Stanford University psychologist, Carol Dweck has come up with her revolutionary idea that our success to a great extent depends on our mindset rather than talent.
It is true that our genes influence our intelligence and capabilities, but these qualities do not remain fixed. Practice and perseverance can make a huge impact along with our mindset. The author then goes on to distinguish two different types of mindsets – fixed and growth mindsets. The fixed mindset refers to the belief that our capabilities are determined at birth by our DNA.
This type of mindset, according to Carol Dweck, is the main impediments to success in career, relationship, work, and in almost all areas. People with a growth mindset, on the other hand, think that their success depends on the amount of hard work and efforts they put in. Such a mindset stimulates people to learn difficult things and thus, improve their skills.
Drive, by Daniel Pink
Based on four decades of scientific research on human motivation, Drive offers a different take on the subject. The author reveals that the methods employed for motivating people have not changed over the years, though the nature of our work has radically transformed during the same period.
The majority of organizations are still employing the same managerial style, which the author prefers to call the ‘carrot and stick’ method. This method, according to Daniel Pink, can work for routine, repetitive tasks, but not for creative activities.
The book then discloses the 3 elements of motivation – autonomy, mastery, and purpose, along with examples of how a few companies have integrated these into their work culture.
The Power of Now, by Eckhart Tolle
As the name suggests, The Power of Now is a book that dwells on the importance of living in the present moment. Yes, this is not something you have heard for the first time. But what Eckhart Tolle’s book offers is a true understanding of what it means to live in the moment.
The book is written in a question & answer format and it provides insights into how a failure to embrace the present can lead to worries, fear, and other negative emotions like anger and sadness.
Those with an overactive mind will find this book really helpful. Entrepreneurs can also learn the art of living in the present moment, which can help them to get rid of the habit of constantly worrying about the future.
The knowledge of psychology is largely employed in areas like advertising, market research, and human resources. An understanding of human psychology is, therefore, can be quite valuable for entrepreneurs. It can also help control our own negative emotions and make us more focused and productive.
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