Peter Kaufman: The Multidisciplinary Approach to Thinking
Peter Kaufman: The Multidisciplinary Approach to Thinking
Based on a transcript from The Knowledge Project featuring Peter Kaufman’s legendary speech on multidisciplinary thinking.
Executive Summary
Peter Kaufman is the chairman and CEO of Glenair, an aerospace company he’s led since 1977 with one of the best track records in business history. He’s also the editor of Poor Charlie’s Almanack, the definitive collection of Charlie Munger’s wisdom, and was one of Munger’s closest friends for decades.
In a talk that was never meant to be recorded, Kaufman reveals a simple framework for understanding how everything works—a framework verified across 13.7 billion years of evidence. The core insight: mirrored reciprocation explains nearly all interactions, compound interest is the most powerful force in the universe, and the secret to getting everything you want in life is to go positive and go first.
Key insights from this talk:
- The world works through mirrored reciprocation: what you put out, you get back
- Compound interest works identically in physics, biology, and human achievement
- The biggest obstacle to success is being intermittent instead of constant
- Everyone wants the same things: attention, respect, meaning, and love
- Win-win relationships with all stakeholders eliminate blind spots
Why Multidisciplinary Thinking Matters
Kaufman opens with Austrian philosopher Ludwig Wittgenstein’s insight: “To understand is to know what to do.”
When you truly understand something, you don’t make mistakes. Mistakes come from blind spots—from a lack of understanding. The more we understand, the fewer mistakes we make. This is why multidisciplinary thinking is critical: we understand more when we see connections across disciplines.
The world doesn’t organize itself into neat academic departments. Problems don’t come with labels like “economics” or “psychology” or “biology.” They come unlabeled and interconnected. The 2008 financial crisis wasn’t really a financial problem—it was a psychology problem wrapped in an incentives problem wrapped in a complexity problem. Specialists couldn’t see it because they could only see through one lens.
Kaufman illustrates this with a Japanese proverb: “The frog in the well knows nothing of the mighty ocean.”
The Index Fund Approach to Reading
Kaufman discovered a shortcut to multidisciplinary thinking. He found that Discover Magazine had 12 years of archives online—monthly interviews with experts from various scientific domains, written for general audiences. These weren’t dumbed-down summaries; they were the cream of the crop bringing their A game.
So Kaufman printed all of them and read them “index fund style”—all of them, one after another, every single day for six straight months.
“This is the universe, and I’m going to own the whole universe.”
If left to his own preferences, he admits he probably would have read only a few articles that piqued his interest. He never would have voluntarily read six pages on nanoparticles. But after completing his reading, that’s exactly where he found some of his best ideas.
The lesson: reading broadly beats selective reading because it allows you to capture information most people miss. The biggest ideas often hide in arcane places nobody else is looking.
The Three Buckets Test
Being multidisciplinary creates a new problem: How do you know which ideas are actually true? Kaufman’s solution draws on statistics.
“A statistician’s best friend is a large relevant sample size. A principle derived from a large relevant sample size can’t be wrong.”
He tests every important idea against three buckets—the three largest relevant sample sizes he could think of:
- Bucket One: 13.7 billion years of the inorganic universe (physics, geology, chemistry)
- Bucket Two: 3.5 billion years of biology on Earth
- Bucket Three: 20,000 years of recorded human history
When a principle shows up consistently across all three buckets—when it’s true in physics, biology, and human history—you can trust it completely.
“You see these things lined up like three bars on a slot machine. And boy, do you hit the jackpot.”
How the World Works: Mirrored Reciprocation
Kaufman tests an ambitious question: Is there a simple two-word description that accurately describes how everything in the world works?
Physics (Bucket One): Newton’s third law—for every action, there’s an equal and opposite reaction. Push down on a table, the table pushes back with equal force. This has been true for billions of years. The pattern: perfectly mirrored reciprocation.
Biology (Bucket Two): Mark Twain observed that a man who picks up a cat by its tail will learn a lesson he can learn in no other way. Treat the cat disagreeably, get disagreeable back. Stroke it gently, it starts licking your hand. Agreeable in, agreeable out—mirrored reciprocation.
Human History (Bucket Three): Your entire life, every interaction you’ve ever had, is merely mirrored reciprocation.
Kaufman uses the elevator example: You step into an elevator with a stranger. You can smile and say good morning (98% chance they reciprocate), scowl and hiss (98% chance they reciprocate), or do nothing (you get nothing back).
“Whatever you put out, you get back. But you have to go first.”
Why don’t more people go positive first? Daniel Kahneman’s answer (which won him the Nobel Prize): humans weigh potential losses far more heavily than equivalent gains. We sacrifice 98% upside to avoid a 2% chance of rejection or embarrassment.
The Most Powerful Force: Compound Interest
Kaufman tests another question: What is the most powerful force we can harness?
Physics: Einstein allegedly called compound interest the most powerful force in the universe, the greatest mathematical discovery of all time. Kaufman’s working definition: dogged, incremental, constant progress over a long period of time.
Biology: The most powerful force in 3.5 billion years of life—evolution. How does it work? Dogged, incremental, constant progress over a very long time frame.
Human Achievement: Olympic gold medals, mastering an instrument, building Berkshire Hathaway. Same formula: dogged, incremental, constant progress.
Three buckets, same answer. Jackpot.
If compounding is so powerful, why doesn’t everyone harness it? Because humans hate being constant.
“We’re the functional equivalent of Sisyphus pushing his boulder up the mountain. You push it halfway and you go, ah, I’ll come back to this another time. And the boulder rolls back down.”
When Kaufman asks how many people are truly constant, he names two from personal experience: Warren Buffett and Charlie Munger.
“Everybody wants to be rich like Warren Buffett and Charlie Munger. And I’m telling you how they got rich. They were constant. They were not intermittent.”
What Everyone Wants
Kaufman observes that all humans are fundamentally identical in what they want. He asks his audience: How many want to be paid attention to, listened to, respected? How many want meaning, satisfaction, fulfillment? How many want to be loved?
Every hand goes up. Everyone is exactly the same. The only difference is the strategy they employ to fulfill those needs.
He illustrates with what dogs know instinctively: every time humans come home, greet them with the biggest unconditional show of attention—for about 15 seconds. Then you can ignore them. But do it every single time, and the human will do anything for that dog.
“All you have to do if you want everything in life from everybody else is first pay attention, listen to them, show them respect, give them meaning, satisfaction and fulfillment, convey to them that they matter to you, and show you love them. But you have to go first.”
The 22-Second Course in Leadership
Kaufman offers a complete leadership course in 22 seconds: Take the list of things everyone is searching for—a person who is trustworthy, principled, courageous, competent, loyal, kind, understanding, forgiving, and unselfish. In every single future interaction, be that list.
This connects to Mary Kay Ash’s insight: everyone has an invisible sign hanging from their neck saying, “Make me feel important.”
Win-Win with All Six Counterparties
Kaufman’s formula for zero blind spots: see through the eyes of all six important counterparty groups and structure everything to be win-win with them:
- Customers
- Suppliers
- Employees
- Owners
- Regulators
- Communities you operate in
Master these relationships, and how many blind spots will you have? Zero. How many mistakes? Zero.
Simple Beats Genius
Kaufman argues that simplicity is the highest form of cognitive achievement. Einstein listed five ascending orders: smart, intelligent, brilliant, genius—and above genius: simple.
Why does simple beat genius? Because you can understand it.
Compare Spinoza’s incomprehensible ethics treatise with the principles Kaufman outlined in less than 30 minutes: mirrored reciprocation, go positive and go first, dogged incremental constant progress. Everyone understands every word. That’s not weakness—that’s the highest form of thinking.
One Precious Life
Kaufman grounds everything in a stark reality: you have one lifetime, it’s finite, and it matters. When something is both finite and important, opportunity costs must govern your decisions.
Most people spend life fighting with everyone around them. Kaufman has explained how to avoid that—and in exchange, you get a celebratory life instead of an antagonistic one.
An African proverb: “If you want to go quickly, go alone. If you want to go far, go together.”
“Live your life to go far together. Don’t live it to go quickly alone.”
The alternative is becoming Ebenezer Scrooge—reaching the end with wealth, power, and fame but wanting a do-over because you didn’t live life right.
A Turkish proverb closes the talk: “No road is long with good company.” The essence of a well-lived life is surrounding yourself with good company. But you have to earn it. You have to deserve it.
Key Takeaways
- Mirrored reciprocation rules everything: What you put out, you get back—in physics, biology, and human relationships
- Go positive and go first: The 2% risk of rejection isn’t worth sacrificing the 98% upside
- Compound interest is the most powerful force: In finance, evolution, and human achievement—same formula
- Be constant, not intermittent: Buffett and Munger got rich by never stopping the compounding
- Everyone wants the same things: Attention, respect, meaning, fulfillment, and love
- Be what you’re looking for: The 22-second leadership course—be trustworthy, principled, courageous, kind
- Win-win with all stakeholders: Zero blind spots come from seeing through all six counterparty eyes
- Simple beats genius: The highest form of thinking is being understood
- You only get one life: Opportunity costs matter—choose a celebratory life over an antagonistic one
- Go far together: Good company is the essence of a well-lived life, but you must deserve it
Read the complete transcript of Peter Kaufman’s talk at fs.blog. Learn more about mental models at fs.blog/tgmm.