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Big fish in a little pond

There's no doubt that the big fish gets respect, more attention and more than its fair share of business as a result.

The hard part of being a big fish in a little pond isn't about being the right fish. It's about finding the right pond.

Too often, we're attracted to a marketplace (a pond) that's huge and enticing, but being a big fish there is just too difficult to pull off with the resources at hand.

It makes more sense to get better at finding the right pond, at setting aside our hubris and confidence and instead settling for a pond where we can do great work, make a difference, and yes, be a big fish.

When in doubt, then, don't worry so much about the size of the fish. Focus instead on the size of your pond.

Three things to keep in mind about your reputation

  1. Your reputation has as much impact on your life as what you actually do.
  2. Early assumptions about you are sticky and are difficult to change.
  3. The single best way to maintain your reputation is to do things you're proud of. Gaming goes only so far.

In a connection economy, what other people think about you, their expectations of you, the promises they believe you make—this is your brand. It's easy to imagine that good work is its own reward, but good work is only of maximum value when people get your reputation right, and they usually get that from others, not directly from you.

It's logical, then, to care about how your reputation is formed. But it's dangerous, I think, to decide that it's worth spending a lot of time gaming the system, to consistently work hard to make your reputation better than you actually are.

There is one exception: The most important step you can take when entering a new circle, a new field or a new network is to take vivid steps to establish a reputation. This is the new kid who stands up to a bully the first day of school, or a musician who holds off on a first single until she's got something to say. They say you never get a second chance to make a first impression, but what most people do is make no impression at all.

That reputation needs to be one you can live with for the long haul, because you'll need to.

As the social networks make it more and more difficult for people to have a significant gap between reputation and reality (hence gossip), the single best strategy appears to be as you are, or more accurately, to live the life you've taught people to expect from you.

Your reputation isn't merely based on your work, it's often the result of biases and expectations that existed before you even showed up. That's not fair but it's certainly true. Now that we see that the structures exist, each of us has the ability to over-invest in activities and behaviors that maximize how we'll be seen by others before we arrive.

Be your reputation, early and often, and you're more likely to have a reputation you're glad to own.

Understanding taxonomy

If you need to add a word to the dictionary, it's pretty clear where it goes. The dictionary is a handy reminder of how taxonomies work. The words aren't sorted by length, or frequency or date of first usage. They're sorted by how they're spelled. This makes it easy to find and organize.

The alphabet is an arbitrary taxonomy, without a lot of wisdom built in (are the letters in that order because of the song?).

It's way more useful to consider taxonomies that are based on content or usage.

Almost everything we understand is sorted into some sort of taxonomy. Foods, for example: we understand intuitively that chard is close to spinach, not chicken, even though the first two letters are the same.

The taxonomy of food helps you figure out what to eat next, because you understand what might be a replacement for what's not available.

Shopify has more in common with Udemy (both tech startups) than it does with the Bank of Canada (both based in Ottawa).

Your job, if you want to explain a field, if you want to understand it, if you want to change it, is to begin with the taxonomy of how it's explained and understood.

Once you understand a taxonomy, you've got a chance to re-organize it in a way that is even more useful.

Too often, we get lazy and put unrelated bullet points next to each other, or organize in order of invention. For example, we teach high school biology before (and separate from) chemistry, even though you can't understand biology without chemistry (and you can certainly understand chemistry without biology). We do this because we started working on biology thousands of years before we got smart about chemistry, and the order stuck.

The reason an entrepreneur needs a taxonomy is that she can find the holes, and figure out how to fill them.

And a teacher needs one, because creating a mental model is the critical first step in understanding how the world works.

If you can't build a taxonomy for your area of expertise, then you're not an expert in it.

The opposite of the freeloader problem

Is the freegiver advantage.

Freeloaders, of course, are people who take more than they give, drains on the system.

But the opposite, the opposite is magical. These are the people who feed the community first, who give before taking, who figure out how to always give a little more than they take.

What happens to a community filled with freegivers?

Ironically, every member of that community comes out ahead. 

The post-reality paradox

Reality and rational thought have paid more dividends in the last century than ever before.

Science-based medicine has dramatically increased the lifespan and health of people around the world. Vaccines have prevented millions of children from lifelong suffering and even death. Evidence-based trials have transformed the output of farms, the way organizations function and yes, even the yield of websites.

It's possible to imagine a world of 6 billion people without the advances we've enjoyed, but you wouldn't want to live there.

It's not just the obvious outcomes of engineering and scientific success. It's also the science of decision making and the reliance on a civil society, both of which require the patience to see the long term.

For someone willing to engage in a discussion based on data, there is no doubt that this approach is working. It works so well, it’s easy to take it for granted, to assume that miracles will keep coming, that the systems will keep working, that the bridges and the water systems won’t fail and the missiles won't be launched. It's easy to lose interest in spreading these benefits to those that don't have them yet.

At the very same time that engineering put us on the moon, post-reality thinking invented a conspiracy that it didn’t happen. When we get close to eradicating an illness, we hesitate and focus on rumor and innuendo instead.

While reality-based medicine has ameliorated some of the worst diseases humans have ever experienced, quack medicines have been on the upswing for the ones that remain.

The most famous doctor in the country, Mehmet Oz, is primarily known for blurring the lines. His gifted medical talents have saved lives in the operating room, but he’s just as likely to talk about a quack diet based on coffee beans. There's been huge forward progress in the science of medicine, but all the money and attention on placebos hasn't improved their outcome much.

When Hillary Clinton lies, her standing decreases. But when Donald Trump lies, it actually helps his standing among his followers. That’s because he’s not selling reality, he’s selling something else. It’s confusing to outsiders, because he’s not working on the same axis as traditional candidates.

The hallmark of post-reality thinking is that it watches the speech with the sound turned off. The words don't matter nearly as much as the intent, the emotion, the subtext. When we engage in this more primeval, emotional encounter, we are more concerned with how it looks and feels than we are in whether or not the words actually make sense.

The irony, then, is that people who have been cut off from clean water, from things that actually work, from the fruits of a reality-based system that changed everything—these people are hungering for it, want it for their children. But for those that have taken it for granted, who have the luxury of using it without understanding it, the pendulum swings in the other direction, seeking an emotional response to economic and technical disconnects.

The more that reality-based thinking has created a comfortable existence, the more tempting it is to ignore it and embrace a nonsensical, skeptical viewpoint instead.

We used to be able to talk about science and belief, about what’s real and what we dream of. The and was the key part of the sentence, it wasn’t one against the other.

If they are seen as or, though, if it’s belief (anger or fear) against/vs./or the reality of what’s here and what’s working, we do ourselves, and our children, a tragic disservice. 

"Don't confuse me with facts" is no way to move forward. It's a risky scheme.

Joni Mitchell famously warned, "you don't know what you've got till it's gone." I'd rather not find out.

 

[PS a lot of wisdom in many ways, some direct and some metaphorical, in Albert Adler's principles. And somewhat related, this post on victims, critics and mistakes.]

But how much does it cost?

I know what the price tag says. But what does it cost?

Does it need dry cleaning? What does it eat? How long does the training take?

What happens when it breaks? Where will I store it? What's the productivity increase that justifies the ongoing expense? 

How many staff hours does it take to support this new approach? How will it make me feel to tell other people that I own it? Do I need enhanced security or insurance? What happens to the operation when it goes down and needs to be replaced? What skills will I lose if I rely on this? Is it housebroken? 

And, what's the cost to all of us to produce it and then dispose of it when it's done? 

The professional pushes back

The architect refuses to design the big, ugly building that merely maximizes short term revenue. She understands that raising the average is part of her job.

The surgeon refuses to do needless surgery, no matter how much the client insists. He doesn’t confuse his oath with his income.

The marketer won’t help his client produce a spammy campaign filled with tricks and deceptions, because she knows that her career is the sum of her work.

The statesman won’t rush to embrace the bloodlust of the crowd, because statesmen govern in favor of our best instincts, not our worst ones.

There are plenty of people who will pander, race to the bottom and figure out how to, “give the public what it wants.” But that doesn’t have to be you. Professionals have standards. Professionals push back.

PS, and just in time, we’re thrilled to announce that the next two sessions of altMBA are open for applications as of today. Ask someone who’s done it.

The clown suit

It's ever more tempting to put on the (metaphorical) clown suit.

It allows you to provoke with impunity.

Clowns enjoy a different relationship with the laws of physics.

You can spray someone in the face with a seltzer bottle, hit them with a pie or tweak them, and then laugh about it.

No one is allowed to comment on the size of your shoes or how many people you're packing in that car or the weak link between you and reality.

Crowds gather and no one takes the implications of what you say seriously, but they cheer. Tricksters change our culture. Noisy voices get more followers in social media…

The challenge, as PT Barnum, Don Rickles and the National Enquirer have found, is that while the suit is easy to put on, it's almost impossible to take it off. After a while, people start to notice that you're not actually keeping your promises.

[and regular readers might enjoy this response post, from 11 years ago]

A value creation checklist

This project you’re working on, the new business or offering, what sort of value does it create?

Who is it for? What mindset and worldview and situation?
Is it paid for by organizations or individuals?
Does it solve a new problem or is it another/better solution to an old problem?
Will a few users pay a lot, or will a lot of users pay a little?

Do the people you seek to serve know that they have the problem you can solve for them?

Are you leveraging an asset that others don’t have?
Are you hiring talent and reselling it at a profit?
Are you combining the previously uncombined in a way that’s hard to duplicate?
Are you building technology that will create its own inertia, disrupting existing value chains and improving as it goes?
Are you doing something that others can’t do, or won’t do, and will that continue?

If you’re solving an existing problem, are you hoping that people will switch to your solution, or is the goal to get users who are new to the market or unaware of existing solutions?
Do you need a salesforce? What percentage of the value that’s created is created by talented salespeople?

How will people find out about the solution you are offering?

Are you a freelancer or an entrepreneur?

If you’re selling to organizations, what will your customer tell the boss?
How long is the sales and adoption cycle? Can you wait that long?
If you’re building a brand, how long will you have to invest (lose money in building trust and awareness) before you profit (generate profit margins that make up for your investment)?

Is there a network effect?
Are you building a natural monopoly?

Is there any substantial reason why your customers won’t simply switch to a cheaper alternative?
How much better do you need to be than the status quo to get someone to leap and switch to your solution?

What are the externalities and side effects like? How will the establishment of your solution change the market, the environment and the culture?

How long can you sustain this? What happens when the market changes, or you do?

What's the value you create over a lifetime relationship with a customer? Does that lifetime value establish a need for an endless supply of new customers, or are you able to heavily invest in just a few?

We need what you're working on… and focusing your solution makes it far more likely that it will find the traction it needs.

What’s at the bottom of the river?

I have no idea if the bottom of the Hudson River is smooth or not. I know that on a calm day, the surface is like glass.

One reason to lower the water level of a system you count on is to see what's messing things up. You can discover what happens when you operate without slack, without a surplus… you want to know what's likely to get in the way…

This is the essence of Toyota's quality breakthrough. When Toyota got rid of all the extra car parts held in reserve on the assembly line, every single one of them had to be perfect. If a nut or bolt didn't fit, the entire line stopped. No cars got made until the part was perfect.

This seems insane. Why would you go through the pain of removing the (relatively) low cost buffer of some extra parts? The answer, it turns out, is that without a buffer, you've lowered the water level and you can see the rocks below. Without a buffer, every supplier had to dramatically up his game. Suddenly, the quality of parts went way up, which, of course, makes the assembly line go faster and every car ends up working better as well.

Fedex had to build a system far more efficient than the one they use at the Post Office. When you only have 12 hours to deliver a package, the rocks will kill you. Now, when they need to deliver something in three days, they're still way better at it than the post office is. Fewer rocks.

The purpose of sprinting without slack isn't that you will always be sprinting, always without extra resources or a net. No, the purpose is to show you where the rocks are, to discover the cruft you can clean out. Then, sure, go back and add some surplus and resilience.

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