“Books are the bees which carry the quickening pollen from one to another mind.” ~James Russell Lowell

And my all-time favorite quote about reading…

“Outside of a dog, a book is man’s best friend.  Inside of a dog it’s too dark to read.” ~Groucho Marx

I love to read books and absorb new information and ideas. In this final post of the year, I thought I would share some of the books that most inspired me this year. I hope you might also get great value from them. Some of them aren’t exactly business books, but I got business value from them and I thought you might benefit similarly.

Without further ado, and in no particular order, here are my favorite books of the year:

Customer Culture: How FedEx and Other Great Companies Put the Customer First Every Day
by Michael D. Basch

This one was recommended to me by Anna Barcelos after I wrote my post on the 4 Keys to a Customer Centric Culture. Luckily, I think I was largely on the same page as Michael Basch, but I learned so much more about company cultures after reading his tome. Basch was a co-founder of FedEx and their initial SVP of Sales and Customer Service. He relays plenty of his learnings at FedEx, but he also relates the stories of other customer focused businesses small and large. He even covers an incredibly innovative Australian dentist office! Many of the stories sparked plenty of ideas in my mind, and I even excerpted one to highlight in my blog post on the power of naivete. Basch gives some very specific and easy-to-follow advice on creating the types of customer-focused cultures that drive businesses that simply succeed more because of their focus on their customers.

Why Can’t You Just Give Me the Number? An Executive’s Guide to Using Probabilistic Thinking to Manage Risk and Make Better Decisions
by Patrick Leach

Every manager and executive should read this book. Patrick Leach does an excellent job explaining the concepts of probabilistic thinking and decision making, and he does it in everyday language that is easy to consume for business people who don’t necessarily have advanced degrees in mathematics. He makes a very compelling case for using probabilistic thinking to greatly improve the bottom line. This book, more than any other, was the inspiration for some of my posts on Monte Carlo simulations.

The Hidden Brain: How Our Unconscious Brains Elect Presidents, Control Markets, Wage Wars and Save Our Lives
by Shankar Vedantam

This is a book that I actually didn’t love immediately after reading it. However, the concepts I got from it kept creeping back into my brain, and maybe that’s an even better way to value a book. I excerpted a bit of it in my most recent blog post on the power of our hidden brains to dominate our decision making in ways we don’t consciously realize. Author Shankar Vedantam deftly manages to explain complicated brain inner workings through easy-to-read stories that illustrate the concept and leave lasting memories.

The Upside of Irrationality: The Unexpected Benefits of Defying Logic at Work and at Home
by Dan Ariely

I included Dan Ariely’s first book, Predictably Irrational: The Hidden Forces That Shape Our Decisions, as an all-time favorite in last year’s list of best business books. While the experiments and ideas in that book were probably more useful in the marketing and merchandising functions, I would say this book is much more about human interactions and general management and leadership. Ariely focuses on topics such as the effect of pay on performance, the motivational value of creating things, and the high addiction of our own ideas. As you might guess from the title, Ariely’s conclusions are not often what we’d expect but extremely beneficial.

Switch: How to Change Things When Change is Hard
by Dan and Chip Heath

Anyone who’s attempted to implement major change in an organization knows how difficult it can be. This book is an excellent guide for how to implement and encourage change in business and in life. I loved not only the tips but the explanations about why we humans have such a difficult time with change. The Heath brothers use a metaphor of the Rider and the Elephant to describe the rational and emotional parts of our brains that are so fundamental to accepting and embracing change (and making decisions of any kind). It’s an excellent way to visualize the concept and a concept that I’ll not likely forgot.

Click: The Magic of Instant Connections
by Ram and Ori Brafman

I actually dedicated a post to this book. This is a fascinating look at the reasons people click with each other. The authors really break it all down and in the process provide an excellent roadmap for creating better connections between people. Used in a business environment, this knowledge can help up create better functioning, happier and more productive teams.

The Design of Everyday Things
by Don Norman

This is not a new book by any means, but I somehow never read it until this year. I found this book to be extremely eye opening and completely fascinating. Don Norman spends a lot of time talking about the design of objects like doors and faucets, yet the design principles he discusses and the human psychology learnings that go into those design principles are absolutely relevant to usable designs of things that didn’t even exist in the time he wrote this (the ’80s) — like websites. I explored just a couple of these concepts, and how they apply to retail websites,  in a post earlier this year.

And just for kicks, since I’m a music nut, here are my top 10 albums of the year:

1. Trombone Shorty – Backatown
   A great combination of jazz, funk, hip-hop and rock. Trombone Shorty rips on both the trombone and the trumpet. Standout track: “Hurricane Season.”
2. Florence + the Machine – Lungs
   Technically, this record came out in 2009, but the Grammys have nominated them for Best New Artist this year I think I get to include the record in my list. Great vocals from Florence and the drums in particular are amazing on this record. The sound is powerful, a bit dark and different from anything I’ve ever heard. Standout track: “Dog Days are Over”
3. Grace Potter & the Nocturnals – Grace Potter & the Nocturnals
   Grace Potter can flat out sing, and the songs on this record are top-notch. This is just good, ol’ rock ‘n’ roll and a rollicking good time. Standout track: “Paris (Ooh la la)”
4. The Gaslight Anthem – American Slang
   Gaslight Anthem are kind of a Green Day meets with Replacements and (not surprisingly since they are from New Jersey) jams with Bruce Springsteen. Standout track: “The Spirit of Jazz
5. Mumford and Sons – Sigh No More
   The bluegrass tinted pop from British newcomers Mumford and Sons is highly infectious. Very impressive vocal harmonies as well. Standout track: “Winter Winds”
6. Sons of Sylvia – Revelation
   A band of brothers (I assume their mother is named Sylvia), these guys have put together what I guess could be called an alt-country record because it’s basically pop music with country instruments. Lead singer Ashley Clark can flat out wail, and the band certainly holds their own. Standout track: “50 Ways.”
7. Sharon Jones and the Dap Kings – I Learned the Hard Way
   Sharon Jones and the Dap Kings are the best of the new wave of R&B retro, and this record does not disappoint. Standout track: “Money”
8. Ozomatli – Fire Away
   I’ve been an Ozomatli fan for a long time, but I think this is their best record since 2001′s Embrace the Chaos. Great combination of Latin, hip-hop and rock, and the songs are lots of fun. Standout track: “Yeah, Yeah, Yeah, Yeah”
9. Aloe Blacc – Good Things
   I suppose Aloe Blacc is a bit of an R&B retro artist, but he’s got a sound that feels both contemporary and throwback at the same time — and he’s very smooth. Standout track: “I Need a Dollar”
10. Santana – Guitar Gods: The Greatest Guitar Classics of All-Time
    Carlos Santana teaming up with a bunch of guest vocalists to record some of rock’s all-time great guitar songs (sort of — I’m not sure Dance the Night Away would be my choice for a Van Halen song). Artistically, this is not particularly impressive. However, it’s a lot of fun to just listen to Carlos Santana wail away — even when he’s stepping all over the melodies. Standout track: “Back in Black”

What were your favorite business books of the year (and music, too)?

”Happy Anniversary, honey.”

The budget conscious movie producer drops the script on the table and stares at the director.

“Do we really need the close-up of Owen’s face? The set-up for those shots adds a ton of extra cost. And the bacon close-up? Really? Does that really add anything to the story? Are we going to sell even one less ticket if that shot is not in the movie?”

But the director insists, “Yes, we have to have those scenes. They add the emotion and visceral impact that is required to tell the story, to let the audience feel Owen’s love. They are as essential to the story as the dialogue. Those shots are the difference between a professional film and a home movie, and no one will pay to see a home movie. They may not list the close-ups as the reason they don’t like the movie, but trust me, they’re a much larger factor than you think.”

The director is right. (And don’t worry, this post will eventually get to the retail relevance.)

I’ve been reading a lot about how our brains make decisions. Books such as How We Decide, The Hidden Brain, and Switch all explore the two parts of our brains that combine to formulate our decisions. Scientifically, those parts of the brain are the neocortex and the amygdala. In Switch, the Heath brothers call them the Rider and the Elephant; others call them the rational brain and the lizard brain. Whatever we call them, our decisions are the combined effort a conscious part of our brains that control our rational thinking and an unconscious part of our brains (the Hidden Brain) that controls our emotions.

Think you don’t make emotional decisions? Think again.

It turns out that without our emotional brains, we wouldn’t be able to make decisions at all. In How We Decide, Jonah Lehrer recounts the story of a man whose brain injury caused his amygdala to stop functioning. As a result, he was utterly incapable of making even the simplest decisions in life. Without an emotional brain to push him toward a decision, his rational brain simply went into analysis paralysis.

Our brains are extremely powerful, but they’ve got a lot going on. As a result, they basically compartmentalize processing power and take shortcuts when encountering situations that seem similar to past situations they’ve encountered. While this compartmentalization is generally very efficient, it has its drawbacks. Here’s how Shankar Vedantam explains it in The Hidden Brain:

The conscious brain is slow and deliberate. It learns from textbooks and understands how rules have exceptions. The hidden brain is designed to be fast, to make quick approximations and instant adjustments. Right now, your hidden brain is doing many more things than your conscious brain could attend to with the same efficiency. The hidden brain sacrifices sophistication to achieve speed. Since your hidden brain values speed over accuracy, it regularly applies heuristics to situations where they do not work. It is as though you master a mental shortcut while riding a bicycle—bunch your fingers into a fist to clench the brakes—and apply the heuristic when you are driving a car. You clutch the steering wheel when you need to stop, instead of jamming your foot on the brake.

Now imagine the problem on a grander scale; the hidden brain applying all kinds of rules to complex situations where they do not apply. When you show people the faces of two political candidates and ask them to judge who looks more competent based only on appearance, people usually have no trouble picking one face over the other. Not only that, but they will tell you, if they are Democrats, that the person who looks more competent is probably a Democrat. If they are Republicans, there is just something about that competent face that looks Republican. Everyone knows it is absurd to leap to conclusions about competence based on appearance, so why do people have a feeling about one face or another? It’s because their hidden brain “knows” what competent people look like. The job of the hidden brain is to leap to conclusions. This is why people cannot tell you why one politician looks more competent than another, or why one job candidate seems more qualified than another. They just have a feeling, an intuition.

This same “leap to conclusion” occurs when people visit our websites. They come to our sites with a preconceived notion about what a quality website looks like, and many times those preconceived notions have much to do with the types of design elements that many “rational” thinkers would equate to the frying bacon close-up described in the movie scenario above. It’s hard to imagine how a rounded borders versus straight borders might effect someone’s likelihood to convert, but it will because the hidden brain is making lightning fast decisions about a site’s credibility based on everything it sees and how closely what it sees matches up to its past experiences with what it found to be credible websites. A customer will not likely point to border type as a reason she didn’t buy; she’ll just feel uneasy enough about the site that her ultimate decision to buy will go negative.

Conversely, the right design can play a huge role in increasing a site’s credibility and turning that decision to buy in the right direction. For example, there have been numerous experiments conducted over the years that show how the price of a bottle of wine can genuinely affect people’s taste. In his blog, Jonah Lehrer discusses the wine experiments and “The Essence of Pleasure” and shows how paying close attention to the “essence of a product” or a site, like “Coors being brewed from Rocky Mountain spring water, or Evian coming straight from the French Alps” can actually lead to a change in sensory perception. This, of course, is what good branding is all about and it can absolutely make the difference between new customers further engaging with our sites or bouncing off to another site.

Since customers won’t generally be able to tell us about specific design elements that are causing them discomfort, we need to use various techniques to help us get to the heart of the truth. Multivariate testing can be a great way to understand the immediate value of different designs. Combining multivariate testing with a predictive voice of customer methodology like the ACSI methodology used by ForeSee Results (shameless plug) can really help us understand the long-term brand impact in ways that simply multivariate tests alone cannot. It’s critically important to understand our customers’ perspectives on design in context with their overall future intentions in order to get to a truth of design’s impact that even the customer could not tell us directly.

Metrics and methodologies can point us in the right direction, and then we need to hire and trust talented, professional designers to do their thing. In the end. high-quality, professional design speaks well to the hidden brain and leads to enhanced credibility. Enhanced credibility facilitates a better selling environment. So, yes, we really do need the frying bacon close-up.

What do you think? How is design treated in your organization? What tips do you have? Or are you not buying it?

Heck, I’ve also written a white paper and blogged about social media.

Don’t get me wrong. I think social and mobile are important opportunities for us to improve our businesses. I just don’t think we should focus on them to the exclusion of some of the core aspects of our sites and businesses that still need a lot of work.

The level of our success with any of these new technologies is going to be limited by the effectiveness of our core site capabilities and constrained by any internal organizational challenges we might have.

Here are some topics I’d love to see get a little more press and conference content time:

• Usability
  From my vantage point at ForeSee Results, where I can see customer perceptions at many different retailers, it’s clear that our sites have not come close to solving all of our usability issues. In fact, I’ll go as far as saying improving usability is the #1 way to increase conversion. I’m currently reading a book called “The Design of Everyday Things” by Don Norman. The book was written in the ’80s (I think) so there’s no mention of websites. Instead, he talks a lot about the design of doors, faucets and other everyday objects and, most interestingly, the psychology of we humans who interact with these things. The principles he discusses are absolutely relevant to web page design. Other books, such as “Don’t Make Me Think” by Steve Krug and anything by Jakob Nielsen are also great sources of knowledge. I’d sure love to see us cover these types of topics a little more in our conferences and trade mags. Also, how do different retailers approach find and solve usability issues? In the end, if the experiences we create aren’t usable our social and mobile strategies won’t reach their potential.
• Organizational structure
  How often do we come back from a conference with great new ideas about implementing some new strategies (say, a new social media or mobile commerce strategy) only to run into competing agendas, lack of resources or organizational bureaucracies? Discussing and writing about organizational structure doesn’t have the panache of social media or other exciting new frontiers, but there’s little doubt in my mind that the structure of our organizations can make or break the success of our businesses. When we were first setting up the organization for the new Borders.com, we spent a LOT of time studying the structures of other companies learning about the pros and the cons from those who lived through different schemes. It was hugely useful and more interesting than you might think. Mark Fodor, CEO of Cross View, just wrote an excellent piece for Online Strategies magazine that discussed the hurdles involved in going cross-channel and included a very good discussion about the need for mindset shifts. I’d love to see these topics further explored in interactive environments at industry conferences.
• Incentives
  Books like Freakonomics make strong cases for the fact that incentives drive our behaviors. I’d love to hear how other companies set up their internal incentive structures. And there are multiple types of incentives. Certainly, there are financial incentives that come in the form of bonuses. But there are also the sometimes more powerful social incentives. What gets talked about all the time? How do those topics of discussion influence people’s behaviors? How do all those incentives align with the needs generated by new strategies to maximize the power of social media or mobile commerce?
• Data/analytics storytelling
  We have so much data available to us, and we all talk about being data driven. But how do we get the most from that data? How do we use that data to form our strategies, support our strategies and communicate our strategies. John Lovett of Web Analytics Desmystified wrote an excellent piece on telling stories with data recently. There are also several great blogs on analytics like MineThatData, Occam’s Razor, and the aforementioned Web Analytics Demystified. I’d love to see more discussions in trade mags and conferences about how to get the most from our data, both in analyzing it and relating the findings to others.
• International expansion
  We used to talk a lot about international, but it doesn’t seem to be a big topic lately. Yet the opportunities to grow our businesses internationally are immense. So, too, are the challenges. Jim Okamura and Maris Daugherty at the JC Williams Group wrote an absolutely excellent white paper late last year on the prizes and perils of international expansion. Jim did have a breakout session at last year’s Shop.org Annual Summit, but I’d love to see more discussion from retailers who have gone or are going international to learn more. Or it would also be good to hear from those who simply ship internationally or those who have decided to stay domestic to learn more about their decision making processes.
• Leadership
  Leading lots of people and convincing big, disparate groups to do new things is hard. I just read the book Switch: How to Change Things When Change is Hard by Dan and Chip Heath. There are some amazing tips in that book about implementing change in organizations (and in other parts of life, for that matter). I would love to see more discussion of these types of leadership topics that help us all implement the changes we know we need to make to take advantage of new opportunities like social media and mobile commerce.

I know a lot of these topics are more business basics than retail or e-commerce specific. But the reality is we need to be our absolute best at these business basics in order to implement any of our new ideas and strategies. I personally always enjoy talking to other retailers about some of these basics, and I certainly never tire of reading books that expand my horizons. I’d love to see more about these topics in our conferences and trade mags.

But these are just my opinions. I’d really love to know what you think. As a member of the executive content committee for Shop.org, I’m actually in a position to influence some of the excellent content that my good friend Larry Joseloff regularly puts together. But I’d love to know if you agree or not before I start banging the drum. Would you mind dropping me a quick comment or an email letting me know if you agree or disagree. A simple “Right on” if you agree or a “You’re nuts” if you don’t is plenty sufficient; although, I certainly appreciate your expanded thoughts if you’d like to share them.

Please, let me know what you think of my little rant.