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Trading Psychology 2.0: From Best Practices to Best Processes by Brett N. Steenbarger

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Chapter 4Best Process #4: Developing and Integrating Best Practices

If one does not know to which port one is sailing, no wind is favorable.

Lucius Annaeus Seneca

What Are Best Practices?

Best practices are the cornerstone of quality improvement. We cannot improve the quality of our efforts if we do not keep score and differentiate between what is successful and what is not. That means that every effective practitioner is to some degree a researcher, tracking outcomes and using those outcomes to guide future efforts. Best practices, in that context, are a crystallization of deliberate practice.

Let's imagine a situation in which a chain of restaurants tracks customer comments and satisfaction levels. Over time, certain units produce reliably better ratings than other ones. Several restaurants in the chain achieve absolutely outstanding reviews; a few also receive startlingly poor ones. Jeff, the head of quality control for the company, decides to visit each of the sites as a customer and observe first-hand the factors that might account for the variability in the ratings. He breaks down his own ratings into five categories: (1) ambiance; (2) initial service; (3) service during the meal; (4) quality of the food preparation; and (5) service at the end of the meal. He visits the 10 restaurants in the chain with the highest satisfaction ratings and the 10 with the lowest ratings. Here is a summary of what he found:

  • Ambiance—By design, the restaurants are laid out similarly with ...

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