Seth Godin's Blog, page 249

The free market

Companies that operate in a free market generally work as hard as they can to make that market not free.

By creating lock in, monopolies, patent protection, long term contracts, chasms in pricing and other barriers to entry, companies profit out of proportion to their risk or investment. That's their job.

Acting on their own behalf, self-interested companies will almost always work to make the playing field unlevel, to create loopholes and to generate barriers that keep the market unfree. It's what their owners profit from.

Their adversaries? Technological change, enforced transparency and regulation in favor of consumer protection and against monopolies. There's no question that an unfettered authoritarian corporate regime is more efficient and effective--in the short run. In the long run, though, the free market triumphs, as long as it isn't destroyed by those that get to play first.

The free market is a great idea, which is why we need to be careful when market incumbents lobby to make it un-free.

Why makers should think a little bit more like managers (and vice versa)

Paul Graham, as usual, is thought provoking.

There's no question that programmers, designers, writers and others that do their best work in a moment of flow do themselves and their organizations a disservice when they are ruled by the clock and spend a lot of it in meetings.

Paul's argument is that makers should be insulated from this sort of wasteful nonsense.

The essay is one of his best ever, but I think he needs to add a key point...

Managers need to act more like makers, because making is more important than ever before. Even the most Outlook-driven manager can benefit from finding the isolation to do truly challenging work.

Makers need to be disciplined enough to interact like managers, else they will become pawns in a system they don't sufficiently influence. If you're not present when decisions are getting made, my guess is that you won't like what gets decided...

Neither side gets to insist on just one way. Both need to do more of the other's work. Not because it's easy or even fun, but because it's still the best way to bring your vision to the world.

Insist on the coin flip

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... 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 salesforce.

Unlike Harvard case studies, we had no graphs, no history, no data. We were the first in the category and there was just 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 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 flipped 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 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. Not waste 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.

Limited (and unlimited)

Two deadlines today:

Eight tickets left for the upcoming April 11 full day event in NYC.

A few hours to buy the five-pack of Poke the Box at a big discount. (Not many left, it seems).

It fascinates me that books are generally unlimited. A popular book never goes out of print. An unpopular ebook never goes out of print either. They are here today and they will be here tomorrow.

It's funny how a scarcity of availability and a ticking clock changes our perspective and the desire to take action.

Perfect vs. interesting

There are two jobs available to most of us:

You can be the person or the organization that's perfect. The one that always ships on time, without typos, that delivers flawlessly and dots every i. You can be the hosting company or the doctor that might be boring, but is always right.

Or you can be the person or the organization that's interesting. The thing about being interesting, making a ruckus, creating remarkable products and being magnetic is that you only have to be that way once in a while. No one is expected to be interesting all the time.

Fedex vs. Playwrights Horizons.

When an interesting person is momentarily not-interesting, I wait patiently. When a perfect organization, the boring one that's constantly using its policies to dumb things down, is imperfect, I get annoyed. Because perfect has to be perfect all the time.

Who's responsible for service design?

How many people should be answering the phone at Zappos on a Saturday? What's Southwest Airlines policy regarding hotel stays and cancelled flights? Should the knobs on the shower at the hotel go side by side or one above the other? Can I turn it on without getting sprayed with cold water? How many steps from the front of the hotel to the registration desk?

Too often, we blame bad service on the people who actually deliver the service. Sometimes (often) it's not their fault. Sadly, the complaints rarely make it as far as the overpaid (or possibly overworked) executive who made the bad design decision in the first place. It's the architecture of service that makes the phone ring and that makes customers leave.

Three quick tips for anyone who cares about this:
1. Require service designers to sign their work. Who decided to make it the way it is?
2. Run a customer service audit. Walk through the building or the software or the phone tree with all the designers in the room and call out what's not right.
3. Make it easy for complaints (and compliments) about each decision to reach the designer (and her boss).

In my experience, most of the problems are caused by ignorance and isolation, not incompetence or a lack of concern.

The difference between blueberries and apples

(one bad blueberry spoils the whole bunch)

If you serve yourself blueberries by the handful, you won't be able to inspect each one. And so just one rotten blueberry can ruin the entire bowl of cereal.

An apple is different. It's hand picked. Pick the wrong one and it's not such a big deal, you can just pick another.

If you sell apples, then, the goal is to make the great ones great, really great. If you're in the blueberry business, on the other hand, the goal is to eliminate defects.

An artist who works on matters of personal taste, then, can afford to go to the edges... in fact, she must. Let the buyer choose! Books and paintings and houses are apples.

The manufacturer of fungible items, on the other hand, embraces six sigma, because recovering from a failure is expensive (and it's your fault). Sutures are blueberries.

Moving beyond teachers and bosses

We train kids to deal with teachers in a certain way: Find out what they want, and do that, just barely, because there are other things to work on. Figure out how to say back exactly what they want to hear, with the least amount of effort, and you are a 'good student.'

We train employees to deal with bosses in a certain way: Find out what they want, and do that, just barely, because there are other things to do. Figure out how to do exactly what they want, with the least amount of effort, and the least risk of failure and you are a 'good worker.'

The attitude of minimize is a matter of self-preservation. Raise the bar, the thinking goes, and the boss will work you harder and harder. Take initiative and you might fail, leading to a reprimand or termination (think about that word for a second... pretty frightening).

The linchpin, of course, can't abide the attitude of minimize. It leaves no room for real growth and certainly doesn't permit an individual to become irreplaceable.

If your boss is seen as a librarian, she becomes a resource, not a limit. If you view the people you work with as coaches, and your job as a platform, it can transform what you do each day, starting right now. "My boss won't let me," doesn't deserve to be in your vocabulary. Instead, it can become, "I don't want to do that because it's not worth the time/resources." (Or better, it can become, "go!")

The opportunity of our age is to get out of this boss as teacher as taskmaster as limiter mindset. We need more from you than that.

The worst voice of the brand *is* the brand

We either ignore your brand or we judge it, usually with too little information. And when we judge it, we judge it based on the actions of the loudest, meanest, most selfish member of your tribe.

When a zealot advocates violence, outsiders see all members of his tribe as advocates of violence.

When a doctor rips off Medicare, all doctors are seen as less trustworthy.

When a fundamentalist advocates destruction of outsiders, all members of that organization are seen as intolerant.

When a soldier commits freelance violence, all citizens of his nation are seen as violent.

When a car rental franchise rips off a customer, all outlets of the franchise suffer.

Seems obvious, no? I wonder, then, why loyal and earnest members of the tribe hesitate to discipline, ostracize or expel the negative outliers.

"You're hurting us, this is wrong, we are expelling you."

What do you stand for?

Ten years of changing the world

Acumen celebrates its tenth anniversary this week.

Lesson 1: In fact, you can make a difference, you can start something from scratch, you can build something without authority or permission. Passionate people on a mission can make change happen.

Lesson 2: In fact, philanthropy works. Building systems and enhancing entrepreneurial outcomes generates results far bigger than the resources invested.

Lesson 3: You better be prepared to stick it out, to exert yourself, to last longer than you ever expected and to care so much it hurts.

Some highlights:

More than 3 million people have access to safe, affordable, and efficient energy

7,000 people have jobs and hundreds of millions of insecticide treated bednets have been produced by A to Z

More than 330,000 farmers are changing their families' lives with drip irrigation systems

Hundreds of thousands have access to quality sanitation in Kenya – and Eco-Tact has become a model for other countries

More than 150,000 farmers have access to quality, affordable hybrid seeds in Western Kenya
1298 is now answering more than 30.000 emergency calls every month in India (and has created more than 1250 jobs)

Kashf has reached more than 300,000 borrowers with micro-loans and emerged as one of Pakistan's important civil society institution

The first commercial mortgages for the poor have been provided in Pakistan and Saiban has developed a working, sustainable model for low-income housing development

More than 350,000 individuals have access to safe drinking water (and this doesn't include the copycat companies that have emerged as a result of WHI's innovation in the Indian marketplace)

Aravind provides quality eyecare through telemedicine to millions across India and has served as a global model

Sekem is the largest exporter of organic goods from the Middle East to Europe (working with 4,000 farmers on reclaimed desert land)

That a small band of talented, driven people could make this happen isn't surprising to me. What surprises me is that we still wonder whether change like this is possible.