19th December, 2021
Week 51/52
Pōhutukawa Tree, photo by me.
In the year 4 BC (Before Covid, aka 2016) we spent a year travelling. It was so good the only real negative was that it may be a high tide mark that we never return to.
A little habit we picked up was always leaving one thing undone in each place we visited. For example, we didn’t go to Louvre in Paris or to the theme park in Ulaanbaatar or to the Sugar Loaf in Rio. That way we always have a good excuse to go back to all of those places at some point.
With that in mind I was tempted to make this the last Top Three, leaving week 52/52 missing, so that I might be more likely to return to it in the future.
On the other hand, it seems silly to get this close and not complete the full deck.
So, there will be a final Top Three on Boxing Day.
But, for the benefit of those who may have completely checked out for summer by then...
Thanks to everybody who has taken the time to read what I've written this year. I’ve really appreciated having an audience to force me to stick to a regular cadence of publishing. I hope you have enjoyed it and will find some interesting ways to apply it in 2022.
🍩 Limit
Earlier in the year I wrote about the three different types of fun.
To recap, for those (vast majority) who only started reading Top Three more recently:
Type One Fun: is fun while it is happening (aka “simple” fun)
Type Two Fun: is miserable while it’s happening, but fun in retrospect
Type Three Fun: is not fun at all, not even in retrospect (the canonical example of this seems to be Shackleton’s Expedition to Antarctica 🥶)
I suggested there was actually a fourth type of fun, which can often get mis-categorised as "procrastination":
Type Four Fun: fun at the time, but regretted later
So, how do we manage all of these things that are tempting in the moment but bad for us over the long term - like donuts? 1
There are basically two strategies we can use:
Abstain
Sometimes we need to remove the temptation entirely.
For example, the food we eat is a subset of the food we buy. So, if we want to improve our diet we could stop buying the food we don’t want to eat.
(I say "subset" here intentionally, because some of the food we buy is thrown away rather than eaten. Interestingly, the food that is best for us - fruit, vegetables, etc - is also the most perishable, and so the most often discarded.)
Moderate
Sometimes we can ration.
For example, we mostly eat whatever food we are served. So, if we want to limit the volume we consume then we could consciously order smaller portions, when we eat out, and buy smaller plates and bowls so that there is a natural limit to the amount we serve ourselves.
(This crockery hack is an example of the "pit of success" we talked about last week. It's much easier to do the right thing if we've created an environment where that is also the path of least resistance.)
Which of these is the better strategy?
If we read too much self-help then we are likely to be pulled in one direction or the other. But, this is just another continuum. There is no right answer.
If our problem is that once we start we just can't stop then maybe we need to abstain. If our problem is that we too easily overindulge and have so much of a good thing it becomes a bad thing then maybe we need to moderate.
The fact that I've used food examples throughout reveals one of the things that I personally struggle to manage. You will each have your own examples.
Maybe for you it’s alcohol, tobacco or other more seriously addictive drugs - like a regular salary? Maybe it’s time spent on work (at the expense of family). Maybe it's your CO2 emissions? Maybe it's doom scrolling on social media? Maybe it's exposure to sunlight?
The list of things that are type four fun is long!
Either way, the important thing is to think in advance about the things that we each need to manage and be mindful and explicit about our strategy and techniques for dealing with all of those.
And when we don't get it right, to look back and think about what we need to change to make it easier in the future...
🎱 Anticipate
What really ribs our character is the fact that none of us look back over his life. We think about what we are going to do, and only rarely of that, and fail to think about what we have done, yet any plans for the future are dependant on the past.
— Seneca
One of the most important skills for any team to learn is how to review.
If we can develop a habit of consistently and regularly looking back at what we did together, what happened as a result and then considering what we might do differently in the future, then we have the important elements required for improved performance.
A common mistake is to think that we only need to debrief like this when something has gone badly wrong. Actually, research suggests it's much more useful to make this something we do all the time. For example, an exec team or board might have a brief review at the end of every meeting. Doing that consistently makes it part of a normal process, rather than something to be worried about on the rare occasions when it happens, and also less likely to be skipped. It makes it much more likely that little misalignments are identified and corrected before they have a chance to fester and grow into something more serious.
It's very hard to get ahead of a team that is constantly improving.
So, how do we review? 2
Start with some simple open-ended questions: 3
What went well?
What didn't go well? (focus on what happened, rather than who was at fault)
Then, go a bit deeper:
What was surprising or unexpected? (what information were we missing)
How did we respond? (good and bad)
Finally, the most important question:
What did we learn?
(Please call them lessons rather than learnings! 🙏)
But, do we need to wait until after the fact to ask these questions?
Sometimes it's even more impactful to consider them in advance and try to anticipate.
It's often difficult to have in mind the small number of things that are critical to performance, especially when we're talking about things we do all the time: team meetings, sales calls, standard procedures etc. And this is accentuated when it's a diverse team with potentially conflicting objectives.
If we can take time in advance to say the things we are worried about, out loud, in front of our teammates (including all of the things we might be thinking but are generally too afraid or polite to articulate), then that can help to create a shared understanding and, sometimes, real clarity about the things that will make a difference to outcomes.
So, how do we anticipate?
First, imagine that we didn't achieve our goal:
What explanations or excuses will we give? (we might call this a pre-mortem)
Who else or what other event will we blame for our failure?
Then, and even more importantly, imagine that we have achieved our goal:
What are the things that we will say contributed to our success? 4
What are the things that we controlled and will get credit for vs. what just happened to us?
Based on these answers:
What are the things we can do to minimise or accentuate these things right now, to increase the chance of success and decrease the chance of failure?
Feedback loops, compounded over time, are a daunting opponent.
We don't need to wait for things to happen to us. We can review and anticipate and in the process create the lessons that we can then apply to our work to give our teams the competitive advantage that comes with a growth mindset.
🪞 Embellish
When we track our progress and report our results it’s better if we can avoid using vanity metrics.
These are the metrics that make us feel good. They favourably compare our performance to others, or to arbitrary benchmarks. They tell a positive story.
For example, the number of visitors to our website, the number of likes on our social media posts, or the number of times we're mentioned in the media.
For those of us who are competitive by nature the comparisons baked into vanity metrics can be very motivating. But we need to be careful that we don't fall into the trap of comparing our insides with others outsides.
We also need to be wary of vanity milestones.5
These are the things that make for good press releases and generate attention. They give us something to publicly celebrate.
For example, winning awards, partnerships with much bigger companies (which rarely, if ever, translate into significant sales for the smaller partner) or attracting small investment amounts from celebrity investors.
We need to remember causation vs. correlation. Lots of successful companies win business awards. But winning business awards is only loosely related to the things we need to do, have and be in order to build a successful business.
Vanity metrics and milestones are invigorating but potentially flattering and misleading.
What’s the alternative?
We should prefer clarity metrics.6
These metrics highlight trends in our performance and ideally help us decide what to do next. They are actionable.
For example, average usage times per user, average time spent in on-boarding, churn/retention rates by cohort, revenue:acquisition cost ratios, etc.
Clarity metrics are humbling but sometimes exhausting.
It’s easy to be dismissive about vanity metrics and milestones, but…
The average finishing time for a marathon on Strava is 3:58.25 - i.e. just under 4 hours.
The technical difference between a 4:01 marathon and a 3:59 marathon is insignificant - just 2.8 seconds per kilometer (perhaps a few strides). But the psychological difference is huge.
So, let's not pretend that vanity metrics don't have the potential to positively impact performance.
It’s also useful to have hero metrics that we can use to demonstrate progress to people outside of the company. And to generate buzz that might tempt some of them to get more involved.
The best example I've seen of this recently is an environmental restoration project in the Coromandel, where the metric they talk about is "the number of complaints about bird song noise". Those running the project figured that was a great way to show they were having an impact, and even more, to signal to everybody in the area what the real purpose of the project was (i.e. it's not just about planting trees and clearing traps).
We just need to always keep in mind which metrics are useful because they make us (and our team) feel good and which are useful because they help us decide what to do next.
Those are likely different metrics!
Top Three has been a weekly newsletter published during 2021 containing a lot of half-formed work-in-progress, en route to a permanent home on RowanSimpson.com.
Next week, the final post… 😱
I’ve seen these things described as things which make us “shallow happy”, as opposed to things that might not be so immediately enjoyable but which make us “deep happy”.
I'm using “review” rather than “debrief” here intentionally to acknowledge that there is a wide spectrum that can fall under that label, from a quick huddle after a meeting to reflect on what just happened all the way through to a more formal and independent inquiry that investigates the outcomes and root causes.
This simple model is loosely based on the process described in The Winners Bible by Kerry Spackman
This is especially useful question to ask in advance, because after the fact we will be looking back in the knowledge that we were successful, so decisions that were not obvious, or even half chance, will seem much more obvious. See: Historians Fallacy.
Source: Chris Dixon.
These names are not new or original. Eric Ries talked about vanity vs. actionable metrics in The Lean Startup. First Round Capital also published a good breakdown of vanity vs. clarity metrics, with specific examples for different business models.
I hope the Boxing Day edition isn’t really the last one. I’ve come to look forward to these. Thanks again Rowan for a year of careful and empathetic insight.