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The #1 Clue to Disruptive Business Opportunity

January 28, 2021 By Nagesh Belludi Leave a Comment

When most folks encounter a problem, an inconvenience, or an unpleasant situation, they’ll assume these problems are “facts of life” and go on with their lives. At the most, they may even lament about it to others.

Not attentive entrepreneurs. They tend to identify problems and construe them as opportunities.

Serial entrepreneur Miki Agrawal tells the story of how she started WILD, New York City’s first gluten-free pizzeria, after becoming increasingly intolerant to processed foods:

It all started in 2005 when I started having recurring stomachaches. I realized I was intolerant to all of the additives, hormones, and pesticides that were being put in American mass-produced food. At the time, I had given up my favorite comfort food, pizza. In 2006, I opened WILD in New York City to offer people the best version of a pizza: made with organic, gluten-free flours & tomato sauces, and hormone-free cheeses & meats.

During that time, everyone thought “gluten-free,” “farm-to-table,” and “organic” meant “must taste like cardboard,” so it took a lot of education to get people to “get” it.

Embedded in Agrawal’s narrative is a great entrepreneurial thought lesson: You, too, can become better at recognizing unrevealed opportunities by learning to spot the subtle clues all around. The key question to ask is, “This product should already exist, why doesn’t it?”

Learn to Spot Hidden Business Opportunities

Besides WILD, Agrawal has applied the same ingenuity to found two other successsful businesses called THINX underwear and TUSHY bidet accessories.

Answer the following questions to check if some problem you’re aware of serves as a business idea worth exploring:

  • What’s appalling in your personal or professional world?
  • Is this thing so terrible that you want to do something about it?
  • Does this bother any person but you just as much?
  • Your proposed solution should already exist, but why doesn’t it?
  • Could this solution be worth something for others who are dealing with similar problems?

Idea for Impact: “Fix-What-Sucks” Business Opportunities are Everywhere

All you have to do is look around your own life and find something that has been broken, and then fix it. Extend and expand. The world is always seeking better, faster, cheaper, and smarter ways to solve its problems.

Wondering what to read next?

  1. Make ‘Em Thirsty
  2. Constraints Inspire Creativity: How IKEA Started the “Flatpack Revolution”
  3. Always Be Ready to Discover What You’re Not Looking For
  4. Fall in Love with the Problem, Not the Solution
  5. Creativity & Innovation: The Opportunities in Customer Pain Points

Filed Under: Mental Models, Sharpening Your Skills, The Great Innovators Tagged With: Creativity, Entrepreneurs, Innovation, Problem Solving, Thinking Tools, Winning on the Job

Our 10 Most Popular Articles of 2020

December 30, 2020 By Nagesh Belludi Leave a Comment

Here are our most popular exclusive features of 2020. Pass this on to your friends; if they like these, they can sign up to receive our RSS feeds or email updates.

  • A Quick Way to De-stress. Whenever you feel frenzied, meditation can help you focus inward, pull together your scattered energies, and allow your mind to become calm.
  • Don’t Beat Yourself Up Over Your Mistakes. Don’t agonize about what other people are thinking about you. They’re perhaps busy worrying over what you’re thinking about them.
  • Better than Brainstorming for Rapid Idea Generation. Studies have shown that people think of more new—and practical—ideas on their own than they do in a group.
  • Don’t Let Small Decisions Destroy Your Productivity. Good routines can protect you from your more effective negative impulses and bring order and predictability to your life.
  • Never Outsource a Key Capability. By owning the entire customer experience, Domino Pizza has provided a consistent experience for customers and iterate quickly.
  • When You Talk About Too Many Goals. When it comes to persuasion, clarity and conciseness are critical.
  • Best to Cut Your Losses Early. Best to cut your losses early—you’ll have the least sunk costs and the fewest emotional attachments.
  • What Went Wrong on the Boeing 737 MAX. When you devise a highly reliable system, identify all single points of failure, and investigate how risks and failure modes can be mitigated.
  • How Much Risk Can You Tolerate? Encourage careful experimentation and conscientious risk-taking by lowering the risk waterline.
  • The Power of Negative Thinking. The Stoic practice of premeditatio malorum helps intentionally visualize the worst-case scenario in your mind’s eye and tame your anxiety.

And here are some articles of yesteryear that continue to be popular:

  • Better be approximately right than precisely wrong
  • Why good deeds make people act bad
  • Fight ignorance, not each other
  • Care less for what other people think
  • Be a survivor, not a victim
  • Expressive writing can help you heal
  • One question to ask every morning & find your focus
  • How smart companies get smarter
  • How to manage smart, powerful leaders
  • Accidents can happen when you least

We wish you all a healthy and prosperous 2021!

Wondering what to read next?

  1. Maximize Your Chance Possibilities & Get Lucky
  2. Luck Doesn’t Just Happen
  3. Overcoming Personal Constraints is a Key to Success
  4. A Bit of Insecurity Can Help You Be Your Best Self
  5. How to Handle Conflict: Disagree and Commit [Lessons from Amazon & ‘The Bezos Way’]

Filed Under: Announcements, Sharpening Your Skills Tagged With: Attitudes, Risk, Skills for Success, Thinking Tools

What the Duck!

December 28, 2020 By Nagesh Belludi Leave a Comment

There’s a popular technique among programmers called “rubber duck debugging:” put a rubber duck (or a cardboard cutout of a dog) next to your computer, and whenever you get stuck, you talk to the duck.

Yes, you talk your problem and walk your code with that inanimate object. And you perpetuate the stereotype that we geeks are a socially awkward bunch.

“Showing It to Someone Else” isn’t just a way of telling the other what you think; it’s a way of telling yourself what you think. Just the act of slowing down and explaining your problem and its context can bring about a moment of illumination.

Rubber duck debugging is related to what psychologists call “incubation.” The best solutions can strike suddenly and unexpectedly when you aren’t actively working on your problem. Think of Archimedes and his Eureka moment.

Idea for Impact: Talking is often a part of thought. After many failed attempts, switching your brain from problem-solving to problem-explaining—even to a cat, parent, sympathetic coworker, or somebody who may not know much about whatever it is that’s bothering you—can break you free from fixation and trigger creative breakthroughs.

Hat tip to reader Nick Ashcroft.

Wondering what to read next?

  1. Overcoming Personal Constraints is a Key to Success
  2. How You See is What You See
  3. Constraints Inspire Creativity: How IKEA Started the “Flatpack Revolution”
  4. Restless Dissatisfaction = Purposeful Innovation
  5. Four Ideas for Business Improvement Ideas

Filed Under: Mental Models Tagged With: Creativity, Critical Thinking, Parables, Problem Solving, Thinking Tools, Thought Process

Couldn’t We Use a Little More Civility and Respect in Our Conversations?

December 9, 2020 By Nagesh Belludi Leave a Comment

The New York Times recently had an article about a Smith College-class that addresses America’s burgeoning addiction to contempt.

The power of mindful conversation to change minds

The lecturer, reproductive justice-activist Loretta J. Ross, is highlighting the ills of call-out culture. Her class challenges the proclivity to persecute every presumed infringement against morality and represent the victim as somebody intolerable to decent society.

Ross doesn’t believe people should be publicly shamed for accidentally misgendering a classmate, for sending a stupid tweet they now regret; or for, say, admitting they once liked a piece of pop culture now viewed in a different light, such as “The Cosby Show.”

What I’m really impatient with is calling people out for something they said when they were a teenager when they’re now 55. I mean, we all at some point did some unbelievably stupid stuff as teenagers, right?

Call-out culture has taken conversations that could have once been learning opportunities and turned them into mud wrestling. “It really does alienate people, and makes them fearful of speaking up.”

The antidote to that outrage cycle, Professor Ross believes, is “calling in.” Calling in is like calling out, but done privately and with respect. “It’s a call out done with love,” she said. That may mean simply sending someone a private message, or even ringing them on the telephone to discuss the matter, or simply taking a breath before commenting, screen-shotting or demanding one “do better” without explaining how.

Calling out assumes the worst. Calling in involves conversation, compassion and context. It doesn’t mean a person should ignore harm, slight or damage, but nor should she, he or they exaggerate it. “Every time somebody disagrees with me it’s not ‘verbal violence.'”

Debate the issues, Avoid gratuitous name-calling

The recent election has underscored that we continue to be a deeply divided nation. Americans are ever more passionate about their beliefs and committed to their causes. Ideological affiliation is increasingly a matter of tribal identity. Presenting facts can sometimes backfire. In the narrow-minded pursuit of “goodness,” our society has manifested a disgraceful habit of dismissing people with differing attitudes as less than human, “deplorable,” and not worth consideration.

Differences of opinion are natural and healthy facets of any community. The various issues that we face are complicated, affecting different people in different ways. We must be able to express and accept our differences with civility.

  • Listen to the other in interpersonal confrontations. Put yourself in the other’s shoes and mull over a perspective you hadn’t considered previously. There may be a well-founded concern that you weren’t aware of, and you could soften your position and, perhaps, lead you to different conclusions.
  • Don’t approach debates as “take no prisoners” battles. Build bridges with your ideological opponents. If you never earnestly consider others’ opinions, your mind will shrink and become its own little echo chamber.

Idea for Impact: You can’t change minds by damning your opponents

Be civil and respectful of others’ views. As President Obama has reminded, the world is “messy” and full of “ambiguities,” and “if all you’re doing is casting stones, you’re probably not going to get that far.”

Before trying to change others’ minds, consider how difficult it is to change your own.

Wondering what to read next?

  1. How to Gain Empathic Insight during a Conflict
  2. The Problem of Living Inside Echo Chambers
  3. Rapoport’s Rules to Criticize Someone Constructively
  4. Presenting Facts Can Sometimes Backfire
  5. Don’t Ignore the Counterevidence

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Conflict, Conversations, Critical Thinking, Getting Along, Persuasion, Social Dynamics, Thinking Tools

Constraints Inspire Creativity: How IKEA Started the “Flatpack Revolution”

November 2, 2020 By Nagesh Belludi Leave a Comment

In the mid-1950s, Gillis Lundgren (1929–2016) was a draftsman living in a remote Swedish village of Älmhult. He was the fourth employee of a fledging entrepreneur named Ingvar Kamprad.

Kamprad’s business was called IKEA, an acronym combining his initials and those of his family’s farm and a nearby village. He had founded IKEA in 1943 and got his start selling stationery and stockings at age 17. In the 1950s, Kamprad had launched a low-cost mail-order furniture retailer to cater to farmers.

Constraints have played a role in many of the most revolutionary products

In 1956, Lundgren designed a veneered, low coffee table. He built the table at home but realized that the table was too big to fit into the back of his Volvo 445 Duett station wagon. Lundgren cut off the legs, packed them in a flat box with the tabletop, and rushed to a photoshoot for the IKEA furniture catalog.

And in so doing, Lundgren unintentionally birthed the flatpack furniture industry. He modified his simple design and drew up plans for a disassembled version of the table. Lundgren’s Lövet table (now called Lövbacken) became IKEA’s first successful mass-produced product.

IKEA and Its Flatpacking Took Over the World

IKEA’s trademark, easy-to-follow assembly instructions are a central ingredient to the company’s success. Manufacturing and distributing prefabricated furniture via flatpacking has proved enormously successful. It has dramatically facilitated the shipment and storage of pieces that otherwise took up much more space.

According to Bertil Torekull’s Leading by Design—The IKEA Story (1998,) the concept of ready-to-assemble furniture is much earlier than that. But IKEA was the first to systematically develop and sell the idea commercially.

Flatpacking contributed to many of IKEA’s products’ enduring popularity—they’re affordable, sleek, functional, and brilliantly efficient. In 1978, Lundgren designed the iconic Billy bookcase, the archetypical IKEA product that currently sells one in three seconds.

IKEA’s aesthetic of simplicity and efficiency reflects in its exclusive design and marketing approach. IKEA constantly questions its design, manufacturing, and distribution to create low-cost and acceptably good products.

The method has been adopted by numerous other business enterprises, transforming how products are made and sold globally.

Out of Limitations Comes Creativity

One problem with creativity is that sometimes people face an open field of creative possibilities and become paralyzed. Constraints can be the anchors of creativity [see more examples here, here, and here.]

Constraints fuel rather than limit creativity. Use constraints to break through habitual thinking and promote spontaneity. The mere experience of playing around with different constraints can stretch your imagination and open your mind’s eye for ingenuity.

Idea for Impact: Use constraints to help stimulate creativity. As the British writer and art critic G. K. Chesterton once declared, “Art consists of limitation. The most beautiful part of every picture is the frame.”

Wondering what to read next?

  1. Van Gogh Didn’t Just Copy—He Reinvented
  2. Overcoming Personal Constraints is a Key to Success
  3. How You See is What You See
  4. Restless Dissatisfaction = Purposeful Innovation
  5. Unlocking Your Creative Potential: The Power of a Quiet Mind and Wandering Thoughts

Filed Under: Business Stories, Mental Models, Sharpening Your Skills Tagged With: Adversity, Artists, Creativity, Critical Thinking, Entrepreneurs, Innovation, Parables, Problem Solving, Resilience, Thinking Tools

The Waterline Principle: How Much Risk Can You Tolerate?

October 15, 2020 By Nagesh Belludi 1 Comment

American engineer and entrepreneur Wilbert L. “Bill” Gore (1912–86) was the founder (with wife Genevieve (Vieve)) of W. L. Gore & Associates, the maker of such innovative products as Gore-Tex fabrics, Elixir guitar strings, and a variety of medical products.

Gore’s open and creative workplace emphasized autonomy, fairness, commitment, and experimentation. He instituted a mental model for risk-tolerance called the “Waterline Principle.”

Gore compared the level of allowable risk to the waterline on a boat.

  • Sanction risks above the waterline since they wouldn’t sink the boat—you have ample autonomy above the waterline. If a decision goes bad and produces a hole in the side of the boat above the waterline, you can fix the hole, learn from the experience, and carry on.
  • Risks that fell below the waterline, in contrast, can blow a hole that can sink the boat. Below-the-waterline risks need prior approval from the “captain.” Your team can be prepared for such risks, investigate potential solutions, or buy appropriate insurance coverage.

Commenting about Bill Gore and his Waterline Principle, business consultant Jim Collins noted in his How the Mighty Fall (2009,)

When making risky bets and decisions in the face of ambiguous or conflicting data, ask three questions:

  • What’s the upside, if events turn out well?
  • What’s the downside, if events go very badly?
  • Can you live with the downside? Truly?

The Waterline Principle encourages prudent experimentation and conscientious risk-taking by lowering the risk waterline.

Idea for Impact: Risk analysis and risk reduction should be one of the primary goals of any intellectual process. Invite your team to identify risks that can sink the boat and those that can cause survivable damages.

Wondering what to read next?

  1. Smart Folks are Most Susceptible to Overanalyzing and Overthinking
  2. Protect the Downside with Pre-mortems
  3. In Praise of Inner Voices: A Powerful Tool for Smarter Decisions
  4. What Airline Disasters Teach About Cognitive Impairment and Decision-Making Under Stress
  5. Accidents Can Happen When You Least Expect Them: The Overconfidence Effect

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Critical Thinking, Decision-Making, Mindfulness, Problem Solving, Risk, Thinking Tools

Moderate Politics is the Most Sensible Way Forward

September 17, 2020 By Nagesh Belludi Leave a Comment

A sharp observation on political extremism in this 1987 TV ad by comedian John Cleese for the Social Democratic Party-Liberal Party Alliance (1981–88) in the United Kingdom:

Extremism has its advantages … the biggest advantage of extremism is that it makes you feel good because it provides you with enemies. The great thing about having enemies is that you can pretend that all the badness in the whole world is in your enemies, and all the goodness in the whole world is in you. If you have a lot of anger and resentment in you anyway, and you, therefore, enjoy abusing people, then you can pretend that you’re only doing it because these enemies of yours are such very bad persons and that if it wasn’t for them, you’d actually be good-natured and courteous and rational all the time.

I don’t belong to a political party, and I don’t think I’ll ever join one. Partisan talking points irritate me no end. I’ll watch the upcoming debates, though, because I’ll find all the onstage mudslinging and the impulsive provocations very entertaining.

In politics, everyone tries to push emotional buttons. Few seem to talk about an evidence-based attitude for making decisions and allocating society’s resources where they’ll make the most impact.

Besides, the media today have made the exchange of ideas particularly charged and increasingly polarized. The only way to be heeded to in a screaming vortex is to scream louder and resort to premeditated ad hominum.

Idea for Impact: Wisdom doesn’t reside solely on one side of the center. I am partial to those moderates whose political stance often varies with the issue. Contrary to popular perception, they aren’t tuned-out or ill-informed. Instead, they’re disposed to see both sides of the complex problems, disregard the left and the right’s excessively ideological positions, and seek the middle ground.

Wondering what to read next?

  1. To Make an Effective Argument, Explain Your Opponent’s Perspective
  2. How to Gain Empathic Insight during a Conflict
  3. The Problem of Living Inside Echo Chambers
  4. Presenting Facts Can Sometimes Backfire
  5. Don’t Ignore the Counterevidence

Filed Under: Managing People, Mental Models Tagged With: Conflict, Critical Thinking, Getting Along, Persuasion, Politics, Thinking Tools, Thought Process

Never Outsource a Key Capability

August 17, 2020 By Nagesh Belludi Leave a Comment

In 2003, Domino’s Pizza started requiring its franchisees to adopt the company’s own point-of-sale system (POS) system, internally called PULSE, instead of letting franchisees choose third party POS systems that could integrate with Domino’s IT systems.

That strategy gave the company the ability to seamlessly control the entire ordering process and add functionalities such as online- and mobile-ordering, voice ordering, and contactless payments.

At the same time, Domino’s clever marketing convinced consumers that it has the snappiest ordering process among all the pizza vendors.

How Domino’s Pizza reinvented itself

In 2009, Domino’s changed its pizza recipe and admitted that its previous version was awful in a series of brilliant commercials that featured the tagline, “We’re Sorry for Sucking.” Executives even read out vicious customer comments on camera resembling the Jimmy Kimmel ‘Mean Tweets’ show.

Domino’s (which is, incidentally, headquartered a mile from my home in Ann Arbor, Michigan) used its PULSE POS system as the centerpiece of a technology ecosystem that has helped it flourish as an “an e-commerce company that sells pizza.”

Digital sales skyrocketed as the company tapped into greater demand for convenience, and Domino’s carved a bigger slice of home delivery and food pickup market. Morningstar’s R.J. Hottovy notes that Domino’s laser-sharp focus on improving online ordering has paid off leaps and bounds:

Technology plays an important role in Domino’s efforts to develop and enhance its brand image. Domino’s global technology platform includes a digital loyalty program with a rewards system, electronic customer profiling, geo-tracking of pizzas being delivered to customer homes, and customer geo-tracking to have carryout pizzas ready just as they enter the store. Other innovations include high-speed ovens (which reduced cooking time to four minutes) and Pulse (a unified point-of-sale system,) which have re-engineered fulfillment processes to be best-in-class. Pulse integrates all orders (regardless of origin) into a seamless interface that provides detailed monitoring of every aspect of the ordering, cooking, fulfillment, and delivery processes, which reduces bottlenecks and minimizes downtimes, enabling Domino’s to offer faster delivery times than competitors.

By owning the entire customer experience, Domino’s has been able to provide a consistent experience for customers irrespective of how they order, use data to create value for customers, and iterate quickly. No wonder, then, that Domino’s share price is up 28-fold since its 2004 IPO!

Idea for Impact: Don’t outsource what you’re supposed to do best.

Smart companies understand that outsourcing can result in loss of control over key capabilities. That can impede the company’s ability to improve its efficiency in serving customers or introduce changes in response to shifts in the marketplace.

Wondering what to read next?

  1. The Key to Reinvention is Getting Back to the Basics
  2. Reinvent Everyday
  3. Don’t Outsource a Strategic Component of Your Business
  4. Consumer Power Is Shifting and Consumer Packaged Goods Companies Are Struggling
  5. Innovation Without Borders: Shatter the ‘Not Invented Here’ Mindset

Filed Under: Leadership, Mental Models Tagged With: Delegation, Leadership Lessons, Problem Solving, Strategy, Thinking Tools

How You See is What You See

August 15, 2020 By Nagesh Belludi Leave a Comment

So very often, we don’t give ourselves to allow for new understandings, new perspectives, and new interpretations to emerge.

Three people were visiting and viewing the Grand Canyon—an artist, a pastor and a cowboy. As they stood on the edge of that massive abyss, each one responded with a cry of exclamation. The artist said, “Ah, what a beautiful scene to paint!” The minister cried, “What a wonderful example of the handiwork of God!” The cowboy mused, “What a terrible place to lose a cow!”

Idea for Impact: Work to overcome the strong waves of conditioning that you’ve been exposed to your whole life.

Take a step back and consider how you’re responding to a situation emotionally and intellectually.

Free up your mind from the conditioning that may be restraining it.

Don’t let your narrow perspectives—those comfortable walls within which you confine yourself—to make you lose touch with what’s possible.

Explore. Discover. Discern. Open your mind to new frontiers.

Wondering what to read next?

  1. Overcoming Personal Constraints is a Key to Success
  2. Constraints Inspire Creativity: How IKEA Started the “Flatpack Revolution”
  3. What the Duck!
  4. Restless Dissatisfaction = Purposeful Innovation
  5. Four Ideas for Business Improvement Ideas

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Creativity, Critical Thinking, Parables, Problem Solving, Resilience, Success, Thinking Tools, Thought Process

Overcoming Personal Constraints is a Key to Success

August 14, 2020 By Nagesh Belludi Leave a Comment

Why do some people reach ever-higher levels of achievement, while others struggle or just plug along?

Norman Vincent Peale, the doyen of the think-positive mindset, provides a particularly illustrative example in You Can If You Think You Can (1987):

In Tokyo, I once met an American, an inspiring man, from Pennsylvania. Crippled from some form of paralysis, he was on a round-the-world journey in a wheelchair, getting a huge kick out of all his experiences. I commented that nothing seemed to get him down. His reply was a classic: “It’s only my legs that are paralyzed. The paralysis never got into my mind.”

No matter how formidable your talents, you’ll be held back by certain attitudes and behaviors that limit your achievements.

Your personal constraints—some of them beyond your control—will determine your level of success. Identify those constraints and make a plan to triumph over them.

Idea for Impact: The more you can reframe your attitudes toward the past, future, and present, the more likely you’ll find a meaningful life. Don’t let your constraints lay down what you can achieve.

Wondering what to read next?

  1. Restless Dissatisfaction = Purposeful Innovation
  2. Turning a Minus Into a Plus … Constraints are Catalysts for Innovation
  3. How You See is What You See
  4. The Arrogance of Success
  5. Four Ideas for Business Improvement Ideas

Filed Under: Mental Models, Sharpening Your Skills Tagged With: Attitudes, Creativity, Critical Thinking, Innovation, Mental Models, Parables, Problem Solving, Thinking Tools, Thought Process

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About: Nagesh Belludi [hire] is a St. Petersburg, Florida-based freethinker, investor, and leadership coach. He specializes in helping executives and companies ensure that the overall quality of their decision-making benefits isn’t compromised by a lack of a big-picture understanding.

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