Whatcha Gonna Do With That Duck?: And Other Provocations, 2006-2012 (31 page)

So why doesn’t everyone do this? For the same reason the quality revolution took a full generation to take hold—it costs more
right now
. It takes planning right now. It requires change right now.

Right now will always be difficult. But efficiency is still free.

… is almost always more profitable than living with certainty.

People don’t like doubt, so they pay money and give up opportunities to avoid it. Entrepreneurship is largely about living with doubt, as is creating just about any sort of art.

If you need reassurance, you’re giving up quite a bit to get it.

On the other hand, if you can get in the habit of seeking out uncertainty, you’ll have developed a great instinct.

Does a ski trip to Aspen make you a successful bond trader, or do successful bond traders go skiing in Aspen?

It’s college acceptance season, and worth considering an often overlooked question:

Do people who are on track to become successful go to elite colleges, buy elite cars, engage in other elite behaviors? (I’m defining elite as something scarce and thus expensive.)

or

Does attending these colleges or engaging in these behaviors make you successful?

It matters, because if you’re buying the elite label as a shortcut to success, you might be surprised at what you get.

There are certainly exceptions (for professions that are very focused on a credential, and for the economically disadvantaged), but generally, most elite products, like college, are overrated as life changers.

It turns out that merely getting into Harvard is as good an indicator of future success as actually going. It turns out that being the sort of person that can invest the effort, conquer fear, and/or raise the money to capture some of the elite trappings of visible success is what drives success, not the other way around.

The learning matters a great deal, and especially the focused effort behind it. The brand name of the institution, not so much.

Don’t worry so much if some overworked admissions officer or grizzled journalist fails to pick you. It might mean more that you
could
go, not that you do.

Does advertising during the Super Bowl make your brand successful? I think it’s more likely that successful brands advertise during the Super Bowl.

Netflix tests everything. They’re very proud that they alpha- and beta-test interactions, offerings, pricing, everything. It’s almost enough to get you to believe that rigorous testing is the key to success.

Except they didn’t test the model of renting DVDs by mail for a monthly fee.

And they didn’t test the model of having an innovative corporate culture.

And they didn’t test the idea of betting the company on a switch to online delivery.

The three biggest assets of the company weren’t tested, because they couldn’t be.

Sure, go ahead and test what’s testable. But the real victories come when you have the guts to launch the untestable.

If you’re not getting paid what you’re worth, there are only two possible reasons:

1. People don’t know what you’re worth, or
   
2. You’re not (currently) worth as much as you believe.
   

The first situation can’t happen unless you permit it to. If you’re undervalued, then you have a communication problem, one that you can solve by telling accurate stories that resonate.

Far more likely, though, is the second problem. If there are reasonable substitutes for your work, and those substitutes are seen as cheaper, then you’re not going to get the work. “Worth,” in this case, means “What does it cost to get something like that if something like that is what I want?”

A cheaper substitute might mean buying nothing. Personal coaches, for example, usually sell against this alternative. It’s not a matter of finding a
cheaper
coach, it’s more about having no coach at all. Same with live music. People don’t go to cheaper concerts, they just don’t value the concert enough to go at all.

And so we often find ourselves stuck, matching the other guy’s price or, worse, racing to the bottom to be cheaper. Cheaper is the last refuge of the marketer unable to invent a better product and tell a better story.

The goal, no matter what you sell, is to be seen as
irreplaceable,
essential
, and
priceless
. If you are all three, then you have pricing power. When the price charged is up to you, when you have the power to set the price, there is a line out the door and you can use pricing as a signaling mechanism, not merely as a way to make a living.

Of course, the realization of what it takes to create value might break your heart, because it means you have to specialize, take risks, create art, leave a positive impact, and adopt generosity in all you do. It means that you have to develop extraordinary expertise and that you are almost always hanging way out of the boat, about to fall out.

The pricing-power position in the market is coveted and valuable. The ability to have the power to set a price is at the heart of what it means to do business profitably, so of course there is a never-ending competition for pricing power.

The curse of the Internet is that it provides competitive information, which makes pricing power ever more difficult to exercise. On the other hand, the benefit of the Internet is that once you have pricing power, the list of people who want to pay for your irreplaceable, essential, and priceless contribution will get even longer.

Very often, we’re challenged to make decisions with too little information. Sometimes, there’s
no
information—merely noise. The question is: How will you decide?

Consider the challenge we faced when setting the pricing for a brand of software we were launching in 1986. It was the biggest project to date of my short career, and it represented more than a year of work by forty people. Should these games cost $29, $34, or $39 each? My bosses and I had one day to finalize our decision for the sales force.

Unlike Harvard case studies, we had no graphs, no history, no data. We were the first in the category and there was nothing significant to go on. The meeting was held late on a Thursday. In addition to my newly minted Stanford MBA, we also had two MBAs from Harvard, one from Tuck, and another, I think from Wharton, in the room.

We talked for an hour and then did the only intelligent thing—we flipped a coin. To be sure we had it right, we double-checked and
went with two out of three. The only mistake we made was wasting an hour pontificating and arguing before we flipped.

This is also the way we should settle closely contested elections. We know that the error rate for counting ballots is some percentage—say it’s .01%. Whenever the margin is less than the error rate, we should flip. Instead of wasting months and millions in court, we should insist on the flip. Anything else is a waste of time and money.

Or consider the dilemma of the lucky high school student with five colleges to choose from. UVM or Oberlin or Bowdoin or Wesleyan or who knows what famous schools. Once you’ve narrowed it down and all you’re left with is a hunch, once there are no data points to give you a rational way to pick, stop worrying. Stop analyzing. Don’t waste $4,000 and a month of anxiety visiting the schools again. The data you’ll collect (one lucky meeting, one good day of weather) is just not relevant to making an intelligent decision. Any non-fact-based research is designed to help you feel better about your decision, not to help you make a more effective decision.

One last example: If you know from experience that checking job references in your industry gives you basically random results (some people exaggerate, some lie out of spite), then why are you checking?

When there isn’t enough data, when there can’t be enough data,
insist on the flip
.

By refusing to lie to yourself, by not telling yourself a fable to make the decision easier, you’ll understand quite clearly when you’re winging it.

Once you embrace this idea, it’s a lot easier not to second-guess your decisions—and if you’re applying to college, you’ll free up enough time to write a novel before you even matriculate.

There are some significant misunderstandings about failure. A common one, similar to one we seem to have about death, is that if you don’t plan for it, it won’t happen.

All of us fail. Successful people fail often and, worth noting, learn more from that failure than everyone else does.

Two habits that don’t help:

• Getting good at avoiding blame and casting doubt
  
• Not signing up for visible and important projects
  

While it may seem like these two choices increase your chances for survival or even promotion, in fact they merely insulate you from worthwhile failures.

I think it’s worth noting that my definition of failure does not include being unlucky enough to be involved in a project in which random external events kept you from succeeding. That’s the cost of showing up, not the definition of failure.

Identifying these random events, of course, is part of the art of doing ever better. Many of the things we’d like to blame as being out of our control are in fact avoidable or can be planned around.

Here are six random ideas that will help you fail better, more often, and with an inevitably positive upside:

1. Whenever possible, take on specific projects.
   
2. Make detailed promises about what success looks like and when it will occur.
   
3. Engage others in your projects. If you fail, they should be involved and know that they will fail with you.
   
4. Be really clear about what the true risks are. Ignore the vivid, unlikely, and ultimately non-fatal risks that take so much of your focus away.
   
5. Concentrate your energy and will on the elements of the project that you have influence on, and ignore external events that you can’t avoid or change.
   
6. When you fail (and you will), be clear about it, call it by name, and outline specifically what you learned so you won’t make the same mistake twice. People who blame others for failure will never be good at failing, because they’ve never done it.
   

If that list frightened you, you might be getting to the nub of the matter. If that list feels like the sort of thing you’d like your freelancers,
employees, or even bosses to adopt, then perhaps it’s resonating as a plan going forward for you.

If you play music on the street, with a bucket for donations, every song has to be a showstopper.

No chance for interludes or pauses or moments where you build up for the big finish. If the passerby doesn’t stop, it’s all for naught.

So your music changes. You’re always at level 11, always jamming it, always pushing in the moment.

Online, we’re all buskers. For a while, anyway.

Once someone has stopped walking and started to listen, you have a choice. You can take that person on a journey, forgo the next stranger and instead seduce the one you’ve got …

Or you can keep pushing for more attention from more people.

Both options work. The challenge is in making a choice, your choice, a choice based on why you’re doing the work in the first place. It’s not up to them, it’s up to you.

This is the first warning sign that a project is in trouble. Sometimes it even begins before the project does.

Quietly, our subconscious starts looking around for an excuse, deniability, and someone to blame. It gives us confidence and peace of mind. [It’s much easier to be calm when the police car appears in your rearview mirror if you have an excuse handy.]

Amazingly, we often look for the excuse before we even accept the project. We say to ourselves, “well, I can start this, and if it doesn’t work perfectly, I can point out it was the …” Then, as the team ramps up, bosses appear and events occur (or not), we continually add to and refine our excuse list, reminding ourselves of all the factors that were out of our control. Decades ago, when I used to sell by phone, I often found myself describing why I was unable to close this particular sale—and realized that I was articulating these reasons while the phone was still ringing.

People who have a built-in, all-purpose excuse (middle child syndrome, wrong astrology sign, some slight at the hands of the system long ago) often end up failing—they have an excuse ready to go, so it’s easier to back off when the going is rough.

Here’s an alternative to the excuse-driven life: What happens if you relentlessly avoid looking for excuses at all?

Instead of people seeking excuses, the successful project is filled with people who are obsessed with
avoiding
excuses. If you relentlessly work to avoid opportunities to use your ability to blame, you may never actually need to blame anyone. If you’re not pulled over by the cop, no need to blame the speedometer, right?

A guy asked his friend, the writer David Foster Wallace,

“Say, Dave, how’d y’get t’be so dang smart?”

His answer:

“I did the reading.”

No one said the preparation part was fun, but yes, it’s important. I wonder why we believe we can skip it and still be so dang smart.

Scientists make predictions, and predicting the future is far more valuable than explaining the past.

Ask a physicist what will happen if you fire a projectile like
this
in
that
direction, and she’ll know. Ask a chemist what happens if you mix x and y, and you’ll get the right answer. Even quantum-mechanics mechanics can give you probabilities that work out in the long run.

Analysts who come up with plausible explanations for what just happened don’t help us as much, because it’s not always easy to turn those explanations into useful action.

Take the layout of Craigslist. Just about any competent Web designer would have predicted that it would fail. Too clunky, undesigned, too many links, not slick or trustworthy. Or consider a new R&B artist, or a brand-new beverage.