The Checklist Manifesto: How to Get Things Right

Gawande begins Chapter 8 by discussing the value of checklists in medicine and reasons why people are generally reluctant to use them. His claim echoes Chapter 3, which argues that the medical field has been stuck in a traditional top-down command structure. Gawande also suggests ego and vanity are driving factors for why the field is resistant to something as simple, yet effective, as a safe surgery checklist. He then examines how checklists are useful in the world of finance. He interviews three money managers, each in charge of successful firms: Mohnish Pabrai, Guy Speirs, and a third under the pseudonym Cook. Gawande discusses how these financiers research possible investment opportunities and how many people are susceptible to impulsive investments. He calls this impulse “cocaine brain” and describes how the prospect of making money involves the same neural pathways as a person who struggles with cocaine. Money manager Mohnish Pabrai is able to resist these impulses by using developed checklists and pause points—protections against impulsive investments. Like Gawande, Pabrai develops these checks based on his own experience and the mistakes of others, including Warren Buffet and his company, Berkshire Hathaway.

Gawande describes an investment gone awry by Warren Buffet’s partner Charles Munger, and suggests that a checklist could have prevented the failure.