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June 22, 2019 - January 8, 2020
Scarcity is another influence model, this one describing how you become more interested in opportunities the less available they are, triggering your fear of missing out (FOMO). So-called “limited-time offers” and “once-in-a-lifetime opportunities” prey on this fear. These are easy to spot online, such as the travel site that says there are “only 3 rooms left at this price,” or the retailer reporting “only 5 left in stock.” Scarcity signals also often imply social proof, e.g., this shirt is going to run out because it is so popular.
In conflicts, you may similarly get the outcome you want by winning people over to your point of view. Thomas Paine did this masterfully by building allies when a conflict was unavoidable. Sometimes you may use framing in this way to prevent a direct fight altogether.
There are some more subtle aspects of framing to consider, captured in a few mental models that we explore in the rest of this section. Let’s think about a more mundane situation than the American Revolution: getting a babysitter. While mid-career professionals are unlikely to take up babysitting for extra cash, they are likely to babysit for free when a friend is in a pinch. The first scenario is framed from a market perspective (“Would you babysit my kids for fifteen dollars an hour?”) and the second is framed from a social perspective (“Can you please do me a favor?”). The difference in the
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distributive justice versus procedural justice. Distributive justice frames fairness around how things are being distributed, with more equal distributions being perceived as more fair. By contrast, procedural justice frames fairness around adherence to procedures, with more transparent and objective procedures being perceived as more fair.
Influence by manipulation of emotions, whether created by perceived injustice, violation of social norms, or otherwise, is called appeal to emotion.
A related practice is the use of a straw man, where instead of addressing your argument directly, an opponent misrepresents (frames) your argument by associating it with something else (the straw man) and tries to make the argument about that instead. For example, suppose you ask your kid to stop playing video games and do his homework, and he replies that you’re too strict and never let him do anything. He has tried to move the topic of conversation from doing homework to your general approach to parenting.
Another related mental model is ad hominem (Latin for “to the person”), where the person making the argument is attacked without addressing the central point they made. “Who are you to make this point? You’re not an expert on this topic. You’re just an amateur.” It’s essentially name-calling and often involves lobbing much more incendiary labels at the other side. Political discourse in recent years in the U.S. is unfortunately littered with this model, and the usual names leveled are so undignified that we don’t want to include them in our book.
A Trojan horse can refer to anything that persuades you to lower your defenses by seeming harmless or even attractive, like a gift. It often takes the form of a bait and switch, such as a malicious computer program that poses as an innocuous and enticing download (the bait), but instead does something nefarious, like spying on you (the switch).
People similarly make homes and businesses seem secure by putting up fake security cameras, having lights in their home on timers, or even putting up signs for a security service they don’t actually use. A related business practice is known as vaporware, where a company announces a product that it actually hasn’t made yet to test demand, gauge industry reaction, or give a competitor pause from participating in the same market.
A tactical approach to deterrence is the carrot-and-stick model, which uses a promise of a reward (the carrot) and at the same time a threat of punishment (the stick) to deter behavior. In our household, we sometimes try to deter fighting between our kids using dessert as the carrot and loss of iPad time as the stick. It’s a form of good cop, bad cop.
When using this strategy, you must give enough notice so that others can adjust their strategies based on your threat. You also have to explain exactly what you intend to do when the red line is crossed. The most severe threat is a so-called nuclear option, signaling that you will undertake some kind of extreme action if pressed. For example, North Korea has repeatedly threatened the literal nuclear bombing of South Korea if invaded.
Once you start looking, you can find generals fighting the last war all over the place: politicians failing to adapt to new campaign strategies (like John McCain’s somewhat staid online presence versus Barack Obama’s modern use of social media in the 2008 U.S. presidential campaign); finance professionals missing the signs of the 2007/2008 financial crisis (because they thought the past could predict the future); or the U.S. education curriculum misreading the staying power of the digital economy (and continuing
Employing guerrilla warfare is an example of punching above your weight. In boxing, competitors are grouped by weight, because large differences in weight, all other things being equal, make a fight unfair. This takes us back to the physics models we discussed in Chapter 4 (see inertia). Heavier boxers pack more powerful punches and are generally harder to knock over. A boxer who punches above their weight intentionally fights in a heavier class, taking on larger competitors on purpose.
Sometimes, though, you may just have to exit with the best strategy you can come up with at the moment, even if it means that your exit isn’t that clean or graceful, recognizing that the long-term outcomes of staying the course are worse. If a solid exit strategy isn’t forthcoming, one tactic is to throw a Hail Mary pass, a last-ditch, long-shot final effort for a successful outcome. The concept comes from a final touchdown attempt in American football where the quarterback throws a really long pass into the end zone in the hope of scoring the final game-winning points. The phrasing became
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We relate this story because most of us are not able to put together or be part of a dream team packed with the most talented people in their fields the world over. Joy’s law is a mental model named after Sun Microsystems cofounder Bill Joy, who remarked at an event in 1990, No matter who you are, most of the smartest people work for someone else. Former U.S. Secretary of Defense Donald Rumsfeld said something similar, known as Rumsfeld’s Rule: You go to war with the army you have. They’re not the army you might want or wish to have at a later time.
The second reason is subtler. There are many excellent people who, despite not being world-class, can achieve 10x output in certain situations, but that output may not be replicated when they switch roles, projects, or organizations. In other words, when you see outsized output by an individual, such as on a resume or via a reference, it is usually because they have many things working in their favor all at once to produce that outsized impact: role in the organization or team, personality as applied to this role, types of tasks assigned, resources provided, and the value of their unique set
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Extroversion (outgoing versus reserved) Openness to experience (curious versus cautious) Conscientiousness (organized versus easygoing) Agreeableness (compassionate versus challenging) Neuroticism (nervous versus confident)
Whether invading countries or markets, the first wave of troops to see battle are the commandos. . . . A startup’s biggest advantage is speed, and speed is what commandos live for. They work hard, fast, and cheap, though often with a low level of professionalism, which is okay, too, because professionalism is expensive. Their job is to do lots of damage with surprise and teamwork, establishing a beachhead before the enemy is even aware that they exist. . . . Grouping offshore as the commandos do their work is the second wave of soldiers, the infantry. These are the people who hit the beach en
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Because 10x teams perform at such a high level, leaders should be actively thinking of ways to create and maintain them. Members of 10x teams tend to have different skills and backgrounds because this gives the team variety in perspectives (see divergent thinking in Chapter 6) and the ability to assign team roles and responsibilities to people well suited for them. This means that at the organizational level, you benefit from diversity because you can create multiple 10x teams by arranging people the right way, drawing on their wide array of skills and other individual traits that diversity
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We call this managing to the person, as opposed to managing to the role or managing everyone the same. In other words, good people management is not one-size-fits-all.
In addition, higher roles tend to involve more strategy than tactics. Generally, strategy is the big picture; tactics are the details. Strategy is the long term, defining what ultimate success looks like. Tactics are short term, defining what we’re going to do next to get there. The Peter principle factors in because promoting someone who is great tactically into a strategic role can be problematic if that person is not strong strategically.
Another critical endeavor for your organization is making the boundaries around roles and responsibilities crystal clear. Apple is known for popularizing a mental model called directly responsible individual, or DRI for short. After every meeting, it is made clear that there is one DRI who is responsible and accountable for the success of each action item. DuckDuckGo similarly assigns a DRI to every company activity—from the smallest task to the largest company objective.
Psychologist K. Anders Ericsson has made a career studying the fastest way to get good at something, a model he calls deliberate practice. It works by deliberately putting people in situations at the limit of their abilities, where they are constantly practicing increasingly difficult skills and receiving consistent real-time feedback. As Ericsson noted in “The Role of Deliberate Practice in the Acquisition of Expert Performance”: “The differences between expert performers and normal adults reflect a life-long period of deliberate effort to improve performance in a specific domain.”
A related model is the spacing effect, which explains that learning effects are greater when that learning is spaced out over time, rather than when you study the same amount in a compressed amount of time. That is, “cramming” is usually a suboptimal strategy, as we noted in Chapter 3. To really learn something, you must reinforce it over and over again.
But for your feedback to be effective, you are going to need specifics.
The consequence-conviction matrix can help you free up your time as a leader, and also categorize situations into learning opportunities for your team members. You can even apply this matrix to family situations. For example, we try to have our kids attempt things that won’t cause much harm if they fail, such as buying something at a store themselves or making their own lunch.
Psychologist Carol Dweck developed the fixed mindset versus growth mindset model, which explains this wrong-versus-right frame of mind, popularized in her book Mindset: The New Psychology of Success.
The Pygmalion effect is a model that states that higher expectations lead to increased performance, as people try to meet the expectations set for them. (It’s named after the Greek myth of Pygmalion, a sculptor who crafted his ideal spouse, whom Aphrodite then gave life to as Galatea.) Conversely the golem effect is the phenomenon where lower expectations lead to lower performance. (That one’s named after a clay creature in Jewish mythology that came to life, grew increasingly corrupt and violent, and eventually had to be destroyed.) Both are types of self-fulfilling prophecies.
Again, being explicit can help: if people understand what they are shooting for, they can rise to the occasion.
As a coach, you should keep in mind the Dunning-Kruger effect and be aware of where your team members are along the curve. When you are working with people who have less expertise, help them properly recognize their level of abilities so they don’t become overconfident, but at the same time praise their learning progression so they don’t become discouraged. It’s a balancing act. As they get closer to the middle of the curve, they will need more and more encouragement as their confidence plummets. And don’t forget to also keep the model in mind when you are learning a skill yourself.
The questions to ask are how accurate your risk assessment was at the time, and whether it could have been any more accurate given the time and resources available. Answering these questions moves you away from black-and-white thinking (the event was totally predictable or not) and into more nuanced thinking (considering how predictable it really was).
In any group setting, it is important to understand the culture, including whether it is one that prefers high-context or low-context communication. A low-context culture is explicit and direct with information, preferring that you be real and tell it like it is. You need a low amount of context to understand low-context communication, because most everything you need to know is clearly expressed.
As Wilson notes, culture is one of the key ways to attract and retain loyalists, which should be the goal if you’re seeking 10x teams for the long term. When working to craft a positive organizational culture, there are a few tactical models to keep in mind as well.
Next, you must be wary of culture eroding as your organization grows. Consider Dunbar’s number—150—which is the maximum group size at which a stable, cohesive social group can be maintained. (It’s named after anthropologist Robin Dunbar.) The idea behind Dunbar’s number is that at about 150 group members and below, you can relatively easily know everyone in the group and their roles within it. Above this number, however, you cannot easily remember everyone and what they do.
When your group consists of only a few people, such as an immediate family unit or a tiny company, everyone can be involved in most major decisions and understand everything relevant to the group. At ten to fifteen people, though, this simple system breaks down, and you need some more organizational structure (subgroups, discrete projects, etc.), or chaos ensues. At thirty to fifty people, the same thing happens again—you need to create even more structure (teams, formal management, etc.) to avoid another round of disruption. And when you get to 150, Dunbar’s number, you start to need more
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final tactical model to keep in mind when building positive culture is another military one: boots on the ground. It refers to actual troops on the ground in a military conflict, who are wearing boots as part of their uniforms. It is often referenced in the context of making the point that you need boots on the ground to be successful in a military campaign, and that conducting a war just from afar—for example, using only air power—will not achieve the ultimate goals.
When you take advantage of price differences for the same product in two different settings, it’s called arbitrage.
The signature of sustainable competitive advantage is what economists call market power, the power to profitably raise prices in a market. For instance, when Amazon has raised its Prime price, it hasn’t lost many customers. An extreme showing of market power is a monopoly. Monopolies have vast market power because they have little competition.
Having market power—individually or organizationally—is an attractive position because you can use your advantages to sustain profit for a long time. That’s why it is called sustainable competitive advantage.
A contrarian bet is therefore most likely to be successful when you know something that almost everyone else doesn’t. In other words, you know that the chance of being right is much greater than the crowd realizes, such as when you know a particular bet has a 10 percent chance of success, but the crowd thinks it’s 1 percent.
The same concept applies for almost any change you want to make, from trying out a new organizational process to pursuing a new career. Why now? Would it make a difference if you waited longer? What would you be waiting for in particular? Given the array of things you can work on, is there another change you should be making right now?
The why now model also explains why there are often concurrent academic discoveries across the world and similar startups independently emerging simultaneously. Wikipedia has a huge list of instances like these, and there is a name for the concept: simultaneous invention, or multiple discovery.
The title of this section is a modern take on an old Japanese proverb, “Vision without action is a daydream. Action without vision is a nightmare.”
Even if you are the first to market with the idea, you will still lose out to the competition if your product cannot create the necessary behavioral change. The first person or organization to try to capitalize on a secret can indeed have a first-mover advantage, crafting a competitive advantage derived from being the first to move into a market with a product. However, they can also experience a first-mover disadvantage if they make a lot of mistakes. Fast-followers can copy the first mover, learn from their mistakes, and then quickly surpass them, leaving the first mover ultimately
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A model that captures these phenomena is resonant frequency. This model comes from physics and explains why glass can break if you play just the right note: Each object has a different frequency at which it naturally oscillates. When you play that frequency, such as the right tone for a wineglass, the energy of the wave causes the glass to vibrate more and more until it breaks.
Customer development works in a wide variety of situations: Talk to residents before you move somewhere. Interview current employees before you take a job. Poll a community before enacting a new policy. For any idea you have, think about who the “customer” is and then go talk to them directly about your “product.” Think focus groups, surveys, interviews, etc.
If, after extensive customer development, you still cannot find this promised land of product/market fit, then you must pivot to something different. A pivot is a change in course of strategic direction, and there are many famous examples. You may be surprised to know that Twitter started as a podcasting network or that Nintendo actually dates back to 1889, when it was founded as a playing-card manufacturer.
When you talk to customers, beware of their focus on a specific solution instead of on the problem they’re trying to solve. For example, as a statistician, Lauren has often been asked to perform statistical analyses using a specific computational technique. However, the particular techniques suggested are often the wrong ones. That’s because non-statisticians are usually unable to determine the best statistical plan on their own, and so instead they suggest a technique they know, regardless of whether it is appropriate (see Maslow’s hammer in Chapter 6). Telling a client or colleague that
A quantitative evaluation like this one is an example of a back-of-the-envelope calculation, a quick numerical assessment that you can calculate literally on the back of an envelope. A simple spreadsheet is the modern-day equivalent. This type of exercise forces you to quantify your assumptions and can quickly result in clarifying insights.
Thinking this way can also help you develop personas, fictional characters that personify your ideal customers, which will help you better reason through a realistic assessment of your idea.
