Mental Models

Intellectual Inspiration Often Lies in the Overlap of Disparate Ideas

January 20, 2022 By Nagesh Belludi Leave a Comment

From David Chapman’s instructive essay ‘How to Think Real Good,’

Learn from fields very different from your own. They each have ways of thinking that can be useful at surprising times. Just learning to think like an anthropologist, a psychologist, and a philosopher will beneficially stretch your mind.

I’ve always been an admirer of the “Renaissance Man”—the notion that one should try to embrace multiple streams of knowledge and develop one’s own faculties as broadly as possible. An archaeologist who studies only material culture will think similar thoughts to a second archaeologist who studies only material culture. However, an archaeologist whose studies include anthropology, biology, geology, and metallurgy has the wherewithal to pursue her curiosity down disparate channels and synthesize multiple perspectives.

Idea for Impact: Dabble in multiple disciplines from time to time and try to understand the basic thinking model of each discipline. You’ll think more broadly, redefine problems outside of normal boundaries, and reach solutions anchored in a unique understanding of complex situations.

Making Tough Decisions with Scant Data

January 18, 2022 By Nagesh Belludi Leave a Comment

Yesterday’s New York Times article highlights the complex tradeoff leaders must often make between indecision and acting on insufficient information:

The Omicron variant is pushing the CDC into issuing recommendations based on what once would have been considered insufficient evidence, amid growing public concern about how these guidelines affect the economy and education. CDC Director Dr. Rochelle Walensky has been commended for short-circuiting a laborious process and taking a pragmatic approach to manage a national emergency, saying she was right to move ahead even when the data was unclear and agency researchers remained unsure. The challenge now for Dr. Walensky is figuring out how to convey this message to the public: “The science is incomplete, and this is our best advice for now.”

The smartest people I know are the ones who understand that they don’t know—can’t know—everything. Yet, they’re ready to act on imperfect information, especially when being slow will be costly.

Idea for Impact: Being able to analyze information is insufficient if you can’t reach decisions.

Knowing you’ll never know everything shouldn’t prevent you from acting. The ability to reason and reconsider your position on something is an integral part of rational thought.

Don’t Be A Founder Who Won’t Let Go

January 17, 2022 By Nagesh Belludi Leave a Comment

You’ll never get a potential successor to take your job if you’re going to be peering over her shoulder constantly and talking to employees directly about what they’re doing.

When you have a case of the founder’s syndrome, you’re addicted to running the show, and you’ll have a hard time separating yourself from the company you’ve built. When there are conflicts, you’re often at the center of it and hold your vision and experience over the leadership’s heads.

In the long run, your compulsion to have a say in all the nitty-gritty of your company will undermine the future of the very company that you’ve devoted your life to. The best thing you can do for its future is to back off and give your successor real control.

Establish a timetable to disengage yourself from the operating decisions and set some firm rules about this transition. Spend increasingly more time away from the business and pursue other interests. Start to envision a world in which your next ventures or leisure activities will become the principal focus of your life.

Idea for Impact: Know when your work is over and when it’s time for you to move on to other things. Grooming exceptional talent to take over the business you’ve built and gradually letting go of control is one of the most challenging things a founder will ever do. If done well, it’s the most transformative you can do for your business.

Real Ways to Make Habits Stick

January 6, 2022 By Nagesh Belludi Leave a Comment

Want to make a new habit stick? Try piggybacking or ‘stacking’ it to an existing one.

Choose something you have no problem motivating yourself to do—say, brushing your teeth—then combine it with some habit you want to acquire. The existing pattern serves as the prompt for the new habit.

Most people have robust morning and evening routines; try stacking new habits into those practices. For example, if you want to do some mindfulness meditation every day, do it after brushing your teeth in the morning. Your wake-up routine becomes the cue to build a new meditation habit.

Better yet, associate the habit you want to achieve with a ‘temptation’ (something you love doing,) like sipping your morning cuppa joe. Your habit stacking plan may look like this: “After I meditate for ten minutes, I will have my coffee.” This way, the habit will become more attractive to you, making it more likely to stick.

Idea for Impact: Good habits build automatically when you don’t have to consciously think about doing them. Look for patterns in your day and think about how to use existing habits to create new, positive ones. Stacking habits can encourage you to remember, repeat, and, therefore, maintain a series of behaviors. Set yourself up for success.

Why Amazon Banned PowerPoint

December 23, 2021 By Nagesh Belludi Leave a Comment

One of the distinctive features of the Amazon management system is its use of the long-form to facilitate decision-making. Jeff Bezos has claimed that banning PowerPoint presentations—more specifically disallowing bullet points for sharing ideas—as Amazon’s “probably the smartest thing we ever did.”

Since June 2004, Bezos has forbidden bullet points and PowerPoint at a senior leadership level. Instead of presentations, teams are expected to iterate an approach to sharing information that involves writing memos of running copy, usually a “six-page, narratively-structured memo.” Meetings typically begin in silence as all participants sit and read the memo for up to half an hour before discussing the subject matter.

Ram Charan and Julia Yang’s The Amazon Management System (2019) reproduces the original email from Bezos explaining this dictum:

Well-structured, narrative text is what we’re after, rather than just text. If someone builds a list of bullet points in Word, that would be just as bad as PowerPoint.

The reason writing a good four-page memo is harder than ‘writing’ a 20-page PowerPoint is because the narrative structure of a good memo forces better thought and better understanding of what’s more important than what, and how things are related.

PowerPoint-style presentations somehow give permission to gloss over ideas, flatten out any sense of relative importance, and ignore the interconnectedness of ideas.

Using memos may seem counterintuitive in an age when communication is increasingly visual. However, long-form has a way of forcing rigor to think through ideas properly, reconcile viewpoints pro and con, iron out logical inconsistencies, and consider second-order consequences.

Bezos’s approach is brilliant not just because sentences and paragraphs enable a certain clarity in thought and exchange of ideas. It also inhibits some of the usual shortcomings of brainstorming meetings, viz., interruptions, biases that initiate groupthink, and the tendency to reward rhetorical ability over substance. Forcing all meeting attendees to read the memo in real-time prevents them from pretending to have read it before a meeting and then bluffing their way through the meeting.

Idea for Impact: Think complex, speak simple, decide better.

Bullet points and “decks” are often the least effective way of sharing ideas. Having a narrative structure allows you to clarify your thinking and provide a logical, sequenced argument to support your ideas.

Plan Your Week, Not Your Whole Life

December 16, 2021 By Nagesh Belludi Leave a Comment

Don’t set unrealistic expectations for yourself. No matter how ambitious and eager you are, no matter how talented you are, there’s a limit to how much you can “produce” in a given time. Moreover, even if you get 24 hours to work, you’re restricted by the amount of energy you’ll have.

Much of long-term planning is guesswork or an expectation of the continuation of prevailing trends. The future can’t be predicted with absolute certainty. At the most, you can be somewhat confident about what might happen in the next few weeks or the upcoming months.

Idea for Impact: Plan Weekly, Review Daily

You can’t identify a precise point in the long-term future and then work yourself from here to there. You’ll be better off if you explore like the Italian navigator Columbus, and just head in a general westerly direction. In other words, have a long-term orientation but operate with medium-term plans. Restrict yourself to a few but significant quarterly goals.

Each week, develop weekly milestones that contribute to the quarterly goals. And each day, schedule 15 minutes to go over your progress and fractionate weekly objectives to daily working goals.

Life is unpredictable, and it is great to have some big things planned out, but not your whole life. A fine-grained approach to goals and planning can help you adapt quickly for survival and success.

Selling is About Solving Customer Problems

December 15, 2021 By Nagesh Belludi Leave a Comment

The best salespeople don’t sway customers through manipulative games and mesmerizing presentations. Instead, they figure out how they can enhance a customers’ lives.

If customers believe their problems are real and, more importantly, if they understand them personally, they’re more likely to be persuaded by an image of a satisfying solution.

No product or service is excellent in and of itself. It’s only worthy if it fulfills customers’ needs.

Invest more time in the problem representation stage. Develop a fuller appreciation of your customers’ problems. Make the idea of paying money for the solutions seem natural. Induce consumers to fit your products and services into their long-held routines.

Idea for Impact: Focus on solving customer problems. Don’t find customers for your product. Find products for your customers.

Nothing Unites Like a Common Enemy

December 14, 2021 By Nagesh Belludi Leave a Comment

On a recent Airlines Confidential podcast, former CEO of Airbus-America Barry Eccleston discussed how Airbus has grown over the years to dethrone Boeing as the world’s largest commercial aircraft maker.

Airbus began in the late 1960s as a consortium of pan-European companies connected by a shared crusade to counter American industrial prowess. Once aviation’s leaders in innovation, these European underdogs had been surpassed by Boeing, McDonnell Douglas, and Lockheed in the ’50s and ’60s.

Once Airbus got started and was standing on its own feet, the concept of ‘Beat Boeing’ became the Airbus mantra. Indeed, it brought together the French, the Germans, the Brits, and the Spanish. If you think about it, Europe had been trying previously to do joint venture programs successfully for quite a while, but most of them didn’t happen. But this one did. And, I believe, it happened, not solely, but in large part, because everybody rallied around a flag, and the flag was called Beat Boeing. Do you remember, in the old days, the Avis slogan was “We are number two, and we try harder?” That kind of like, was where we were at in Airbus. We knew we were number two; we knew we could become number one, and we tried harder.

Idea for Impact: Nothing unites a team like a common enemy. The adversary doesn’t have to be a person, a team, or a competitor. It can be a being-the-underdog mindset or an against-the-the-odds challenge. It can even be a system that has resisted change.

Let’s Hope She Gets Thrown in the Pokey

November 16, 2021 By Nagesh Belludi 1 Comment

The Elizabeth Holmes-Theranos criminal trial hasn’t been without its share of theatrics.

Yes, Holmes’s massive fraud is obvious. She entranced (read WSJ reporter John Carreyrou’s excellent chronicle, Bad Blood (2018; my summary)) journalists, investors, politicians, and business partners into believing her fantasy science. She may even be responsible for negligent homicide if people died because of her company’s fake test results.

Then again, these sorts of cases generally hang on subtle distinctions between hyperbole and outright dishonesty and whether such deceit was deliberate.

Holmes’s lawyers will argue that she was merely an ambitious entrepreneur who failed to realize her vision but wasn’t a fraudster. Her lawyers will make a case that she is not to be blamed because people took her puffery and exaggeration as factually accurate. At what point do her wishfulness and enthusiasm go from optimism to intentional fraud? That’ll be the critical question.

At any rate, the Theranos verdict is unlikely to deter others from the swagger, self-assurance, hustle, and the “fake it till you make it” ethos that is so endemic to start-up culture. Investors will never cease looking at people and ideas rather than the viability of their work.

Idea for Impact: Don’t be so swayed by story-telling that has a way of making people less objectively observant. Assemble the facts, and ask yourself what truth the facts bear out. Never let yourself be sidetracked by what you wish to believe.

Don’t Be Deceived by Others’ Success

November 15, 2021 By Nagesh Belludi Leave a Comment

Imitating successful competitors is a leading pathway to business innovation. Benchmarking can offer meaningful insights into comparative performance and help discover learnings for improvement. However, adopting others’ best practices can be surprisingly misleading and ineffective.

Four perception biases that come with benchmarking other companies can fail to make yours any better.

Many companies luck into success.

As I’ve noted before, you can’t reproduce others’ luck. Successful companies tend to significantly overvalue the effect of their leaders’ deliberate decisions on their performance and understate the role of chance—being at the right time, at the right place, with the right people. Alas, what worked in their circumstances may not work in yours.

The set-up-to-fail syndrome.

Benchmarking can be remarkably misleading when you make oversimplified comparisons to superstars who may not represent your situation. You could sink your business if you blindly copy celebrity leaders’playbooks in the wrong context, product, strategy, or market.

Companies that benchmark Apple and Steve Jobs and sidestep market research often disappoint themselves when their product launches fail. The leaders of these companies neither have Jobs’s brilliant intuition nor his extraordinarily talented creative team to build what customers want but didn’t know they wanted yet.

In the same way, companies that imitate the 20-70-10 “rank and yank” processes from Jack Welch’s playbook often fail to realize that several factors contributed to their success at General Electric. Welch had a robust organizational culture that insisted on regular and candid employee feedback and robust personnel processes for recognizing and developing the best talent within the company.

Corporate culture is a tricky business.

Your company’s culture—the prevailing way your people feel, think, behave, and relate to one another—cannot be changed easily. One industrial company aborted trying to imitate Google’s culture. This company couldn’t get its managers and employees to be more autonomous and innovative because the company’s and the industry’s ingrained culture did not lend itself to experimentation, risk-taking, and the celebration of fast failure.

Benchmarks look backward, not forwards.

In a competitive, ever so fast-changing world, what has succeeded in the past ten years may not necessarily do so in the next 10. The management guru Tom Peters once warned, “Benchmarking is stupid! Because we pick the current industry leader, and then we launch a five-year program, the goal of which is to be as good as whoever was best five years ago, five years from now.”

A strong focus on “quick wins” can turn out long-term losers.

Benchmarking can make short-term gains but have adverse long-term effects that may not manifest until many years later. By imitating an industry leader, a capital goods company decided to boost efficiency by outsourcing design to its suppliers. Years later, it discovered the debilitating effects of the loss of vital technical knowledge.

Idea for Impact: Best practices only add value when applied in the proper context

Applying best practices in the wrong context is a sure-fire way to hold your company back.

Pay attention to all ideas, mull them over, test what makes sense, adopt what works, and discard what doesn’t.

Sure, help yourself to great ideas wherever you can get them, but be mindful of the context. Try to understand how the top performers’ circumstances and culture may be causing their success. Think through the long-term consequences of any decision you take or any practice you adopt.

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Mental Models

Wondering what to read next?

Idea for Impact: Being able to analyze information is insufficient if you can’t reach decisions.

Wondering what to read next?

Wondering what to read next?

Wondering what to read next?

Idea for Impact: Think complex, speak simple, decide better.

Wondering what to read next?

Idea for Impact: Plan Weekly, Review Daily

Wondering what to read next?

Wondering what to read next?

Wondering what to read next?

Wondering what to read next?

Many companies luck into success.

The set-up-to-fail syndrome.

Corporate culture is a tricky business.

Benchmarks look backward, not forwards.

A strong focus on “quick wins” can turn out long-term losers.

Idea for Impact: Best practices only add value when applied in the proper context

Wondering what to read next?