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Counting beans

If you have to serve chili to 1,000 people, holding back just one bean from each person means you end up with a tidy savings, and almost no one is going to notice.

If you run a call center and hire people who make a dollar less an hour, who are less supported, or less trained, or less caring, the impact on each interaction will probably seem pretty small. Of course, if you have a thousand operators, you just saved a lot of money.

And, if you make cars and you figure out how to replace a bolt with a slightly less resilient one, very few drivers will notice, and if you make 200,000 cars a year, that might be enough to pay your entire salary.

You've already guessed the problem.

Some people will notice that the portions are a little skimpy. Some customers will be annoyed enough to switch to another company. And some people are going to die.

When we add up lots of little compromises, we get to celebrate the big win. But overlooked are the unknown costs over time, the erosion in brand, the loss in quality, the subtraction from something that took years to add up.

In a competitive environment, the key question is: What would happen if we did a little better? 

Organizations that add just a little bit every day always defeat those that are in the subtraction business.

Three simple and difficult steps

Get smarter. Hurry.

Learn something new and difficult and valuable. Learn it today and continue learning it tomorrow.

Solve interesting problems.

Ignaz Semmelweis saw the same problem that others saw. But he took responsibility and solved it (worth a read).

Care. More.

This takes guts because it means you’ll have to do something.

If you can invest in these three assets, what happens to your leverage? Your value? Your choices?

There are people who can cut corners better than you, work more hours than you and certainly work cheaper than you. But what would happen if you became the person who was smarter, better at solving problems and cared the most?

Showing up

Some people show up when they need something.

Some people show up before they need something, knowing that it will pay off later, when they need something.

And some people merely show up. Not needing anything, not in anticipation of needing something, but merely because they can.

Fear, failure and shame, oh my

Fear runs deep. Fear used to keep our ancestors alive. Fear keeps you from taunting a saber tooth tiger.

The thing is, most of us don’t have to deal with tigers any longer. But the fear still runs deep.

We still feel the same feelings when we face possible failure, but now those feelings revolve around shame. Losing a videogame in private is fine, but asking a stupid question in a meeting is not.

Shame is the dream killer, because shame (or the possibility of shame) amplifies our fear of fear, keeps us from contributing and short circuits our willingness to explore.

As soon as we give it a name, though, as soon as we call it out, we can begin to move forward. Fear of shame unspoken is fear of shame amplified.

Be afraid of significant failure if you can quantify the downsides. But fear of shame is a waste and a trap.

The half-life of a near miss

How long does it take to forget how frightening it was? 

You fell off your bike and really skinned your knee. How many months or years go by before you're willing to ride a bike again?

The stories we tell ourselves are powerful indeed. I got food poisoning as a kid and never again ate at the restaurant that caused it, even after the restaurant went out of business and was replaced by a totally different business, which then went out of business and was replaced again. There was no rational reason to avoid that particular building, but our myths run deep.

On the other hand, sometimes we do have a rational reason to avoid a particular behavior, but our culture or outside forces or sheer force of habit causes us to forget.

This episode of Dan Carlin's podcast is, like most of his work, extraordinary. In just over five hours, Dan will remind you about just how close each and every one of us came to dying because of nuclear weapons. It was a near miss, by every measure. And yet, within a generation or two, it's easy to forget.

I hope we don't forget.

Is ignorance the problem?

It's nice to think that the reason that people don't do what you need them to do, or conform to your standards, or make good choices is simply that they don't know enough.

After all, if that's the case, all you'll need to do is inform them, loudly and clearly.

So, that employee who shows up late: just let her know that being late isn't allowed. Threaten to fire her. That'll do it.

The thing is, ignorance is rarely the problem.

The challenge is that people don't always care about what you care about. And the reason they don't care isn't that they don't know what you know.

The reason is that they don't believe what you believe.

The challenge, then, isn't to inform them. It's to engage and teach and communicate in a way that shares emotion and values and beliefs.

The thing you can’t have becomes a powerful placebo

The efficacy of a technology, a shortcut, a medicine, a tool, a method—you get the idea—is directly related to how difficult it is to obtain.

Placebos work because our brain picks up where our belief begins. Without some sort of conscious or subconscious trigger, the placebo effect never kicks in. But when it does, it's astonishingly effective. Placebos change performance, cure diseases and make food taste better.

Consider the case of the new music format, MQA. The overdue successor to the MP3 files we've been listening to for a decade or more, MQA treats your music with more care, and the reports are it sounds better. A lot better.

Of course, most people can't hear the difference in a double-blind test, particularly with disposable earbuds. But that's okay, because no one is double blind in real life. Instead, we have information about what we're listening to and where it came from, and it turns out that knowing the provenance of your music can actually make it sound better.

The fact that MQA might actually sound better is a fine thing, but the lesson here is about the story.

The MQA rollout has been agonizingly slow, with dates promised and then missed, with absent bits of gear, with no easy way to get this new technology. Which makes it even better, of course.

The same is true for baked goods that sell out every morning at 8 am, and the new beta-version of an app that makes you more productive.

If you want your medicine to be more effective, consider making it difficult to get.

[PS I'll be doing a Facebook Live Q&A about the altMBA. See you at 2 pm ET today, Thursday.]

Agency

There are institutions, professionals and organizations that would like you to believe that you don't have much choice in the matter.

They want to take away your agency, because it makes their job easier or their profits higher.

But you have more choice than you know.

More ability to shop around, or to skip that procedure altogether. More rights to read the fine print or not sign that document at all.

Mostly, the agency to say yes and to say no, to choose your own course, to not do what everyone else is doing.

The best of us (the worst of us)

When we join an organization and become part of something, collisions happen. Standards change. 

Sometimes, these tribal affiliations push us to become better versions of ourselves. We take a long-term view, check our selfish impulses and work hard to meet the high standards of those around us.

But if we're not careful, we can join a group that indulges in our selfishness, one that pushes us to be callous or short-sighted. To become part of the mob, or the insolent bystanders.

There's nothing inherent in the way humans associate that will lead to one or the other. But once on the path, the culture is difficult to change…

The challenge, then, is to push ourselves to find the right groups (and leave the others behind.)

Our pre-judgment problem

Most of us can agree that picking a great team is one of the best ways to build a successful organization or project.The problem is that we're terrible at it.

The NFL Combine is a giant talent show, with a billion dollars on the line. And every year, NFL scouts use the wrong data to pick the wrong players (Tom Brady famously recorded one of the worst scores ever 17 years ago). Moneyball is all about how reluctant baseball scouts were to change their tactics, even after they saw that the useful data was a far better predictor of future performance than their instincts were.

And we do the same thing when we scan resumes, judging people by ethnic background, fraternity, gender or the kind of typeface they use.

The SAT is a poor indicator of college performance, but most colleges use it anyway.

Famous colleges aren't correlated with lifetime success or happiness, but we push our kids to to seek them out.

And all that time on social networks still hasn't taught us not to judge people by their profile photos…

Most of all, we now know that easy-to-measure skills aren't nearly as important as the real skills that matter.

Everyone believes that other people are terrible at judging us and our potential, but we go ahead and proudly judge others on the basis of a short interview (or worse, a long one), even though the people we're selecting aren't being hired for their ability to be interviewed.

The first step in getting better at pre-judging is to stop pre-judging.

This takes guts, because it feels like giving up control, but we never really had control in the first place. Not if we've been obsessively measuring the wrong things all along.

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