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Kellogg Professor blends business and neuroscience to gain fascinating insights

Kellogg School of Management Professor: Moran Cerf

Moran Cerf enjoys a rockstar status in the academic world. Apart from being an assistant professor of business and neuroscience at the Kellogg School of Management and the department of neurosurgery, he also teaches at the American Film Institute (AFI). He was listed among the ‘2016 Best 40 Professors Under 40’ by Poets & Quants.

With degrees in Physics, Philosophy and Neuroscience, and corporate world experiences in fields ranging from Hacking to Hollywood screenwriting, you may wonder if it’s a single person’s resume you’re looking at, or a whole team’s.

In an exclusive interview with Swati from the MBA Crystal Ball team, Moran Cerf reveals some really unique and insightful lessons from his multi-disciplinary expertise.

In conversation with Moran Cerf

Moran Cerf: Assistant Professor at Kellogg School of ManagementMBA Crystal Ball: Your career graph has been very unconventional and fascinating – from computer security to neuroscience. What were the easy and difficult parts of the transition?

Moran: The transition from being a hacker and working in the security industry to being a neuroscientist was surprisingly smooth and easy. The transition from neuroscience to business was much more challenging.

From Hacking to Neuroscience

Neuroscience, at its core, involves looking inside a complex ‘black box’ (our brain) and learning how it works by inspecting the inputs (sensory information) and outputs (behaviour). These were surprisingly similar to the ways by which hackers approach the black boxes they are trying to break into.

The tools of mathematics, statistics and empirical tests are quite common in both worlds, so translating my knowledge in one field to another was rather seamless. For example, breaking into a bank by identifying information that is normally inaccessible ended up resembling the way by which we try to understanding how the brain codes information that is buried deep inside – conceptually and methodologically.

From Neuroscience to Business

The transition from being a neuroscientist to a business professor, however, was (and still is) much more challenging. The language, terminology, focus of interest and nature of the research are quite different and I had to learn how to look at the work from the perspective of its applicability and relevance rather as a pure intellectual discovery.

Whereas neuroscientists are happy discovering a phenomena and reporting it as is without the need to know what would its application be, the business world asks additional questions like: what is it good for? Additionally, there is a lot of focus on the labelling of identified phenomena to make sure we capture all the underlying constructs that define it before it enters the business jargon.

Learning how to think about my work from that perspective was quite exciting, because suddenly I had to think about my work as if it will be visible and accessible to a much larger community, and had to think about it in a much broader lens.
MBA Crystal Ball: How did you get into teaching in a b-school? Was it a hurdle to not have an academic background in business?

Moran: The process of getting to a business school was gradual. And it is still ongoing. I still feel that I have to convince many people that having neuroscientists in a business setting is essential for their future.

Background in Business

I spent nearly a decade in the business world before going to academia. Working as a hacker back in the early 2000s I was involved with multiple start-up companies and saw their growth from an idea to a public company. So the knowledge I had on the business world from that angle was certainly part of the reason Kellogg was interested in having me be part of their faculty.

I believe that they appreciated my experience as a business owner – seeing small and large companies grow, as well as the fact I had various managerial roles throughout my previous careers.

A Shift in the Corporate World

Additionally, I suspect that what made them want to bring a neuroscientist on board was the fact that there is a large interest among companies in using the brain to explain behaviour in the context of business.

A few years ago there was a surge of social psychologists and behaviour economists who ventured into the world of marketing and offered new ways to understand people’s behaviour and choices by thinking about the mental state they are in when they make a decision. This successful interdisciplinary endeavour opened the gate for other disciplines who could offer interesting ways to explain people’s behaviour using tools that do not rely on surveys and subjective reports.

Since neuroscience seems to offer more and more explanations to our behaviours in ways that are predictable and more accurate than the ones offered before, the call for neuroscientists to join the world of business was imminent.

The fact that many companies around the world recognized the importance of neuroscience in business made multiple academic institutes join the trend.They tried to stay ahead by offering rigorous research on topics relevant to neuroscience and business. Accordingly, the desire to identify brain researchers who are interested in explaining behaviour as well as its roots in the brain became prevalent.

As a neuroscientist, I always care about predicting and understanding the behaviour of humans. Reaching out to channels that places like business schools access frequently (the World Economic Forum, large-scale conferences such as TED or PopTech) made my research visible to both Kellogg and the companies, and accordingly made them see the overlapping interests.
MBA Crystal Ball: What is it about the Kellogg MBA program that has made it the top ranked MBA program in marketing?

Moran: The students.

I think Kellogg recruits a very unique type of MBA students. Ones that not only meet the high entry bar that the university sets, but also that have a set of skills, interest and talents that make them find this place an ideal place to manifest those skills.

If I were to simplify the set of traits that make for a Kellogg student, I would say that they have to not only care about their own prospects, but also have a broader view of how their work and interest will affect the world. Kellogg’s students work in teams in ways that reflect the best of each member, and they find the social interaction key to their success. The collaborative and inclusive nature of their work is reflected here more than in any other place I have seen. This makes the entire place more collaborative.

The business world often tends to be competitive and ruthless, so seeing a place that generates a cohort of student that are extremely sharp and caring while maintaining their collegial and collaborative nature affects the entire school. Accordingly, faculty at Kellogg are much more collaborative and open than most places I’ve seen, the staff and the alumni are highly integrated in the experience of every individual and, altogether, there is a feeling that the school belongs to everyone – from the incoming MBA student who just entered, to the senior faculty who has been here for decades.
MBA Crystal Ball: In what way does your background in neuroscience serve as an advantage in your role as a business school professor?

Moran: I think that there is a growing understanding in the business world that the more you know about people (your customers, your investors, your management, etc.) and how they think, then better you will be able to understand and predict their needs and actions.

To understand people, for years, the academic world focused on looking at analytical data to identify trends in behaviour, or used experiments, polls and surveys to understand their thinking. However, there is a growing understanding, in the last decade, that there are some elements of our behaviour that are inaccessible to the researchers if she used those methods. Works in behavioural economics, psychology, and even the new ways of using analytics to understand large-scale population behaviours have often failed to get to the bottom of how we work and what makes us ‘tick’.

However, within each and every one of us lies this 3 pound structure that governs all of our choices. All our decisions, hopes, dreams, emotions and personality traits are locked in this one vault that codes who we are and what we want.

Neuroscientists hold the key to this vault and they are becoming increasingly good in offering answers to longstanding questions that were of interest to the business world.

Such are: 1) the ability to predict people’s choices before they know them, or 2) the ability to access the mechanisms that come into play when we make purchasing decisions, or 3) the ability to learn how we assess risk internally before making a trading contract. Or, 4) my team’s current work that allows us to predict, with incredible precision, which content people will find engaging or not.

All of those are just examples of many many things that neuroscience has brought to the business world. Things that beforehand we had to guess by asking you for your opinion (which often was flawed, or hard to access or articulate), or by observing your behaviour and making inferences. Having access to the very mechanisms that ultimately governs your behaviour – the roots of your identity –the kernel of your behaviour – is where I believe we investigate further. This is where neuroscience is helping us know who you really are.

Personally, I feel that having professors from fields that are not traditionally in the core canon is always helpful to rejuvenate things. A new blood in the system brings fresh thinking and new practices, new perspectives and new tools that prove helpful and beneficial to everyone.

One of the key words of our contemporary academic times nowadays are interdisciplinarity and diversity. Bringing professors with different skills, different experiences, different backgrounds and different interest offers the students additional ways to look at similar problems and creates conversations that are outside of the standard ones that a typical cohesive community engages in.

Kellogg is known to lead in this domain and repeatedly tries to be at the forefront of research from various fields. Accordingly, the mere addition of faculty from different backgrounds is enough to open a variety of new channels and conversations that would not have come up otherwise.

In the few years that I have been to Kellogg I have had a chance to work on research with groups and individuals that otherwise I would not have access to: media companies, insurance companies, construction companies, the government, and a variety of tech companies that normally would have no direct interactions with neuroscience and neuroscientists. Just the exposure and the ability to get data from these real-world companies while offering them a new look at their customers made a huge difference for my team and for their work.

I feel that the gamble of bringing brain research to business schools already paid off, but it is still at its earliest stages and will become invaluable in the years to come.
MBA Crystal Ball: Your students have described your method of teaching as ‘a departure from the conventional lecture method’. Can you elaborate on your teaching style?

Moran: That is flattering, I think…

I imagine that my style of teaching matches my personality style, which is probably not traditional. I spent time in multiple different worlds: in the business world, in academia – as neuroscientist and a business professor, working in healthcare, or even before when I was in an art school and focused on things like acting, music and ballet. All of those make for an unusual background that I imagine makes for unconventional teaching style.

I guess there is also the fact that I come from different culture, the Israeli high-tech industry, that is known to be blunter and rapid in nature. This makes for an experience that is a departure from the tradition for some students.

Mostly, if I were to guess what make the interaction with the students unique, I would say it is the fact that I strongly believe that, while I am holding the title of their “professor”, I treat them as if each and every one may be as knowledgeable as me on the topic I teach. I feel that the experience in the classroom is shared by all of us and, as a whole, we educate each other. I don’t think that there is some magic knowledge that only I posses and bestow upon them, but that my role as their professor is merely to get the most out of them.

I think this is not necessarily common among professors. Many of my professors, when I was a student, truly believed that they were inherently and profoundly more capable of offering answers to complex problems than the students. While this may be true in some fields where simply having the knowledge is essential, I think it is not the case in some of the fields taught in a business school.

When it comes to learning how to think, or how to approach a problem, experience as well as being an astute thinker is key. And here my students are often as capable as me, if not more. I think that recognizing that and allowing them to flourish makes them, too, believe that they are able to lead and dominate fields of knowledge that they have an advantage in. And this, in my mind, is the key learning from their MBA that I try to instill in them.
MBA Crystal Ball: Does your participation in story-telling events bring new perspectives? Does this experience help you professionally?

Moran: Absolutely. I think that the world we live in now favours those who can tell the story of anything than those who can merely understand it but not express it. Much of our demand from our leaders (in the business world, in politics and in a variety of other fields) is to inspire us, to make us feel that there is a narrative to the journey we are walking in, that there is a meaning to the path and not just the end result.

Telling a story and making the journey be a process that people relate to and find themselves in is key. Accordingly, scientists who can not only do the research but also relate it to everyone and identify why there is a heart to the science are the ones who get to tell its story.

Communication and shared understandings are the key to knowledge in our day and age. A professor who can fully understand a field but is unable to make it accessible to others is, in my mind, failing to offer his or her peers a way to contribute and enhance the knowledge. The content will be siloed and impenetrable for the rest of the world. I regard this as a failure.

Accordingly, in my mind, every professor should train themselves how to speak about their work. And speaking means not just talking to their peers, but also to a lay audience. This makes the research become public knowledge.

I try to spend one day every week talking about my work to groups of people outside my field: kids in schools, popular podcast listeners, businessmen and women who care about employing my research in their field, and people who come to public places to learn. If someone wants to learn, it is our job to make sure they have a way to do it. And stories are the best way I know to translate the knowledge and make sure it is remembered.
MBA Crystal Ball: Marketing management is all about narrating a compelling story about brands, businesses or individuals. Are there any basic principles that they could incorporate to strengthen their marketing strategies?

Moran: I think knowing how to tell one’s story has some basic tools and techniques that could be helpful to everyone, but if I were to distill the ones that I find most useful for me, those are:

1. Be personal and potentially vulnerable.

Don’t try to tell the story that makes you or your product sound flawless and great, but rather the story that shows the angles that make it and you human. We all have variety of experiences and facets and people relate more to ones that they can identify in themselves and share. Exposing your true self makes people immediately side with you. The challenges in creating the product, the reasons it resonated with you personally when you invented or produced it, etc. Those are the things that make it unique. Not the features or inside elements that can easily be replicated by others.

2. Have at least one thing that you are better at, and are excited about. When you come to highlight ‘why you’ – focus on this one thing alone.

The reality is that in every individual’s story and every product there are many great things. If we identify the one thing that we do better – our story should be about that one thing. Here, too many things will actually take away from your story.

In giving a public talk scientists and public speakers often try to highlight many things and tell so many stories that the audience gets lots in the cacophony. Identifying one thing means (and that’s the hard part) making a choice to give up others. But talking about one idea makes for a better story and a better talk than many. Short and concise wins over elaborate in this unique case. If your one story and one feature are compelling you will be asked to talk about others next time. And you will gradually be able to tell your whole list of great things.

3. Watch, read, and learn how others do it.

The best way to start identifying the tools of the trade and the ways to become a fantastic story-teller – one who can communicate ideas, strategies, product advantages, or essentially any thought, is to see how others have done is successfully.

Mimicry is a form of rehearsal.

After you watched enough you will identify what aligns with your style and what does not, what you are capable of easily replicating, and what you are not. Patterns will emerge and the tools will be absorbed by you. There are many ways to learn things, but we learn by having the brain do what it is does best: look at many examples and derive the patterns with no supervision.

Simply spend time getting many observations and the knowledge will emerge.

(this, incidentally, is one of the key reasons to spend time in a schooling system: the exposure to many examples and the infrastructure that forces you to observe them teaches you what makes sense to you.

When you leave you will take the best from the examples you liked, rehash it with your own personal story and come up with a narrative that is unique to you and resonates with many).
MBA Crystal Ball: Business schools use various teaching methods-case studies, simulations among others. Which are the ones you’d recommend as the most effective in delivering complicated business concepts? Are there any specific areas or aspects about MBA education that you’d want to change?

Moran: I am more analytical by nature, and I find quantitative solutions more compelling. I look at cases like a detective story. It involves the little details as well as some intuitions and the ability to read between the lines. I, personally, don’t like cases that seem to have a single ‘correct’ answer or ones that suggest a single path to success, and I try to stay away from those. Cases that have a lot of numbers in them and can be resolved by crunching the data get more room in my class.

However, given that there is some qualitative and subjective nature to the business world, I give room to some of that in my class. I try to incorporate new technologies and new tools as a guiding rule and make the class as dynamic and interactive as possible (the students sometimes use their phones and tablets to answer questions I ask about, in real time, in the classroom since I want them to be able to do that the way they would in the real world).
MBA Crystal Ball: Many MBA grads hope to start their own business after graduation. More than ideation and product development, the bigger challenge is often in the area of marketing. Do you have any tips on how they can compete with the bigger established companies?

Moran: The good thing about marketing is that it ultimately deals with people and how they think. The more you get into the mind-set of your customers – their needs, desires, challenges – the easier marketing is. So in many ways being an empathetic anthropologist-sociologist-historian is what you need in order to excel in marketing.

However, one of the key learnings that we teach our students in the very first class in marketing is that they should remember this:

They are not the average person, and that thinking that what they like is what others would like is a common mistake.

They are very unique in their skills and desires (reflected, for example, by their choice to go get an MBA) and the faster they learn this – the easier it will be for them to learn to think like someone different than them.

The way to do that is by using experiments and data. Since they quickly learn that it is hard for them to learn how to think like a person who is removed from them (geographically, financially, mentally) the best way for them to understand that person’s thinking is by collecting information about his or her behaviour, and applying analytical thinking to their assessment of this behaviour.

Incidentally, as a neuroscientist at heart, I also advocate applying the same empirical rigour to ourselves, not just our customers. One of the recent teachings of neuroscience, a teaching that becomes more and more clear to us as we further our investigation of the brain, is that we do not really know ourselves either – at our core.

We make a lot of assumptions about our behaviour that we then live by only to learn many years later, when we reflect on our past actions and behaviour, that we may have lived in a way that is not fully aligned with our ideal self. So putting our own behaviours to test, in a fair and non-judgmental way, while applying this analytical thinking we direct at our customers, will help us just as much.

My lab recently started doing this with individuals: CEOs, Athletes, and people who are often required to make critical decisions. We learn that exposing the analytical patterns of our choices proves that we can better ourselves and understand our drivers and motivations to a larger extend this way.
MBA Crystal Ball: What are the most intriguing and unintuitive elements of neuroscience that have a profound impact in the business world?

Moran: The recent findings from neuroscience show a few novel understandings that radically shift the way we should think about our decision-making processes and the ways we should think of marketing, finance, accounting and management.

Here are a few examples:

1. Recent knowledge on the way memories are formed, stored and evaluated in the brain suggest that we can essentially change and erase memories, as well as alter memories.

Given that our brain immediately constructs a narrative that “explains the future given the past”, such a shift could end up making a person generate a history that is not accurate. They will then align this history with future choices and justify decisions that were implanted in their narrative externally.

This way we can essentially make a person think they wanted something they may have not originally desired. This is a powerful tool that we need to learn how to harness now.

2. Recent works in olfaction and the brain show that the effects of olfaction on memory are profound enough that they can even be used to alter thinking and help people change their behaviour (i.e. desire healthier food, want to smoke less, etc.).

This is done mostly during sleep where our perception is different. Essentially, an individual goes to sleep and we intervene in a specific moment in their sleep- when their brain is more likely to respond to the stimulus and ‘consider a behaviour change’, and use external stimuli to allow for rapid rewiring of memories.

Now you can think of companies and people using this to help individuals and alter behaviour towards specific outcomes in a targeted way.

3. New study from our group shows that we can now look at the brain of individuals while they are exposed to specific content – say, a commercial, a political campaign ad, a YouTube video, or a TV show – and find, merely by looking at their brain, how engaging the content is. This allows us to decode the interest, emotional involvement, memorability and influence of specific content on the individual.

This is of course profound as it can replace traditional methods of learning about engagement (old methods that involve asking people to rate their engagement while they view the content or right after. (confounded by memory and effects that rely on the quality of the end of the experience). The studies showing we can know what you find engaging are revolutionizing the need for focus groups, survey and a variety of other marketing tools that were originally the only way to know what a customer wants.

4. Using the brain’s unparalleled ability to identify patterns rapidly, even in complex data, has given rise to the new field in computer science known as “Machine Learning”. Essentially trying to replicate the brain’s way of learning information and finding meaning in patterns.

Now neuroscientists have reasoned that beyond regular supervised learning (the type of learning that Machine Learning relies on) we can also harness the brain’s ability to learn and identify patterns in unstructured data. This is done by merely converging and identifying repeated clusters of operations in a totally open space of possibilities.

This is essentially how babies learn skills. We are born with some fixed network that is capable of learning and then our brain gradually converges to strengthen the connections leading to the acquisition of a specific skills (e.g., language). This ultimate ability to find patterns and structure in big data (some suggest it to be the biggest data we can suggest that is coming from a single source originating at the same temporal resolution – all the inputs from all our senses into the brain) demonstrates the power of the brain to rapidly perform the learning task.

Now, people in finance and marketing are realizing this powerful ability and essentially find ways to translate big data problems into sensory content which is delivered directly to our brain.

Examples include taking stock exchange data and turning it into an olfactory experience, or taking multi-dimensional financial decision making and reducing those to a visual feed while having the brain automatically learn to find meaning in the data and accordingly identify a preferred outcome.

Clearly there are many other intriguing and fascinating options to use neuroscience in the context of business, and these few examples (selected randomly with no clear order) show the vast richness of possibilities that we are faced with. We are entering a new era , with new opportunities and new tools.

Some businesses will be the early adopters and will find ways to leverage those early; some will help shape the uses of it. But, if nothing else, businessmen need to be aware of those opportunities so that they won’t be left behind when these sets of new tools penetrate our mainstream.
MBA Crystal Ball: Do you have any tips for MBA aspirants who may not be able to get into an elite business program?

Moran: Business school is not the sole ticket to business knowledge. Many successful entrepreneurs, managers and leaders have had highly successful careers without ever setting foot in a business school. The success in elite business does not necessarily come from the science one gets exposed to in a business school, it comes from the scientific and rigorous mind-set.

If you don’t go to business program, but know how to focus on the facts rather than your own biases, learn to trust data at the expense of intuitions, surround yourself by people who enhance your thinking, and ultimately maintain the creative streak that is at the core of business thinking – you will be able to do equally well in getting through a business endeavour, I suspect.

Regardless, there are multiple ways nowadays to get the practical knowledge that is taught in business school (less so the experiential knowledge). So the basics of marketing, finance, accounting, strategy, etc. – at the initial level that is needed simply to get some intuitions on the field and learn if those are of interest and relevance to you – are available in many ways in our world, and a school is not the only one that governs them.

Finally, as a professor in a business school I would still suggest that gathering knowledge beyond the one offered in the traditional business setting would be highly beneficial for your business future. Learning how to code. Statistics. Philosophy and the art of story-telling and communication are highly important skills, and you might want to start by acquiring those skills outside of the business setting. I did.
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About Swati
After working for over a decade in technical and managerial roles in the corporate world, Swati now works as a freelancer and writes on a variety of topics including education, career guidance and self-improvement.

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