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Why Smart People Come up With Dumb Ideas

Why Smart People Come up With Dumb Ideas

In July 2014, a bunch of engineering graduates — very smart people — decided they had identified a pain point that could become a company. The pain point was that, our search results (think Google) and our News Feed (think Facebook) are personalized; but our homes, where we spend the majority of our time, are not. They founded a startup called Lumos and decided to begin building smart Internet-connected switches to make home personalization a thing. People could install them in their home. The switches would learn from people’s behaviors like when they enter or leave home, and what times they use certain appliances, and personalize all the electric appliances in a home.

It seemed like a great idea. If it could, it seemed to be a multi-billion dollar market.

But it eventually died out. It never had the chance to become an Apple, Google, or Facebook.

Lumos failed. Why? The founders were smart, driven guys. They were working 14-hour days for five-six months. How is this possible?

They failed for many reasons including a lack of due diligence, not being the target users of their product, misunderstanding the market and cost structure, and more.

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But one of the biggest problem was that, the ideas weren’t really there. The product-market fit didn’t make sense. Neither did the cost structure. They had doubts but weren’t transparent about them. A sunk cost bias sunk in.[1]

So yes, smart people can come up with bad ideas. And it happens rather consistently.

The main issue is that we generally assume this formula to be true:

Smart = Always Right = Successful?

    This formula creates a situation where it’s difficult to admit having made mistakes or having done something wrong. If we admit a wrong, we’re not smart enough and not successful. No one wants to feel that way.

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    There is also a “sunk cost bias,” which means it’s difficult to let go of things you’ve invested in. This was actually a problem with Lumos. They couldn’t abandon some of their original ideas and suffered as a result.

    Success is easy to see and visually presents itself well: nice car, big house, good salary, flashy clothes, etc. But usually success is preceded by tons and tons of failure.

    James Dyson’s vacuum cleaners is a great example.

      You see the success: his name is on the vacuum, and somewhat synonymous with the vacuum brand. What you don’t see is that it took him 5,126 attempts to finally get the vacuum right. You don’t see the 5,126 failures.

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      What’s the formula we should use? Try this one:

      Truly Smart = Right + Wrong = Successful

        If you understand that failures are progress, and mistakes made can contribute to true success, you will be better off.

        Prove Yourself Wrong

        You think an idea is perfect? It’s not. Doubt yourself. It’s a way to show how much effort you’ve invested in yourself.

        Understand that failures are progress and that mistakes made will contribute to true success. No matter how much you’ve invested in something, you can still challenge it and grow it to something else.

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        One of the most successful stocks of the last 30 years is a little-known company called Balchem, which has grown 107, 099 percent (not a typo) since 1985. One of the hallmarks of Balchem is admitting and embracing failure. Their stock has significantly outperformed Apple, Amazon, and other top companies during that time. Much of it is rooted in understanding that failure will be there (and often) before success will.[2]

        Look Past Your Effort

        You can defeat the sunk cost issue by looking at the effort you’ve put into something as options to review, not obligations.[3]

        For example, if you sink money into anything, view it as in-progress with the parts as options for future use. Don’t necessarily think that you have to go down the original route you were planning. Remember: Twitter was initially designed to be a platform for podcasting. The founders didn’t stick with that, and elements of Twitter (Arab Spring, etc.) have legitimately changed the world. Don’t be beholden to your first idea.

        Admit Being Dumb Is the New Smart

        Smart people are never satisfied with what they know. They want to get out and learn more and experience more. Less-intelligent people learn a little bit and think they’re set. They don’t grow.

        That’s the essential part. Life, and acquiring knowledge, is about growing. That means failing and missing on ideas. That’s the crucial element. Without that, it’s very hard to know whether an idea is truly good or “vetted.”

        Lean into the skid, embrace failure, and see the effort you’ve sunk in as a future option, not a definitive obligation. Your process of arriving at the truly smart idea will only become more refined.

        Reference

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        Leon Ho

        Founder & CEO of Lifehack

        50 Ways to Increase Productivity and Achieve More in Less Time The Ultimate Night Routine Guide: Sleep Better and Wake Up Productive Powerful Daily Routine Examples for a Healthy and High-Achieving You How to Prioritize Right in 10 Minutes and Work 10X Faster What Is a Habit? Understand It to Control It 100%

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        Last Updated on November 19, 2019

        What Is the 80 20 Rule (And How to Use It to Boost Productivity)

        What Is the 80 20 Rule (And How to Use It to Boost Productivity)

        The 80 20 Rule or Pareto Principle, named after the nineteenth-century Italian economist, Vilfredo Pareto, who discovered that approximately 80% of Italian land in 1896 was owned by 20% of the population, has become a common axiom in business and life.

        The principle was highlighted in 1992 by a United Nations Development Program report that showed that roughly 80% of the world’s wealth was in the hands of 20% of the population.[1] Businesses have reported that 80% of their sales come from 20% of their customers and, Microsoft discovered that if they fix the top 20%, most reported bugs they eliminate 80% of the problems in their software.

        It seems the Pareto Principle is all around us.

        When it comes to our own productivity, the principle can be applied in that 80% of our results come from 20% of our efforts. The trick is to discover what that 20% is so we can apply our most effort to that 20% and eliminate as much of the 80% that does not produce the results we want.

        So how do we do that?

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        Be Absolutely Clear on What It Is You Want to Achieve

        The easiest and most effective way to do this is to be absolutely clear about what it is you are trying to achieve.

        What is the outcome you want to achieve? Most people do not get clarity on what it is they want to achieve, and so get sucked into working on things that will not deliver a big contribution to the overall objective.

        For example, if you have a project to move house, spending an inordinate amount of time discussing the colour you want to have the walls, what furniture you would like and what plants you will have in the garden will not move you very far towards moving house.

        Instead, deciding how many rooms and in what location you would like the house would give you far more important data on which to be able to go to a real estate agent. You are going to find the right house much more quickly than by discussing colours, furniture and items in your garden.

        Before you begin any project, make a list of all the tasks involved to take the project to completion and then flag or highlight the tasks that will give you the biggest contribution towards the completion of the project. Those tasks will be the 20% of tasks that will take you 80% of the way towards completing the project. Focus on those.

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        What Are Your Majors and Minors?

        Jim Rohn coined this question and it essentially means there are parts of the work you do each day that have a direct contribution to the overall objective you are trying to achieve.[2] Other parts of your work do not have a direct contribution to that objective but could be described as housekeeping tasks. The trick is to know what they are.

        Brian Tracy often talks about this with the sales process.[3] Major time is when you are in front of the customer talking with them. Minor time is traveling to the customer or being in meetings with your sales manager in the office. Of course, traveling to see your customer or meeting with your sales manager is important, but they do not contribute directly to your sales performance so that would be classed as minor time.

        When I was in sales many years ago, I learned that while you might be popular with your sales admin team, if you meticulously write out your sales reports every day, doing so did not improve sales performance. I observed that the best salespeople in our company were the ones who had terrible admin reputations and were not the more popular people in the office. The thing is, they were the best salespeople because they understood that being in front of the customer led to higher sales which ultimately led to higher salaries.

        Take a look at your calendar for last week and identify what tasks you did that had the biggest positive impact on your objectives. Then, plan to do more of those next week so you are working on the 20% of tasks you know will take towards achieving 80% of the results you desire.

        Stop Thinking, Start Doing

        I come across this with a lot of my clients when I am coaching them in developing their own businesses. Far too much time is spent on planning and thinking.

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        Now, planning and developing ideas do have their place when you are creating your own business, but there is a line. If you spend 80% of your time thinking and planning, your business is not going to launch.

        Take a simple example. When I began my YouTube channel just over three years ago, I spent a week planning what type of videos I would produce and then I began recording. My first video was terrible, but the process of putting out the videos week after week led to my learning better ways of producing videos which fuelled my channel’s growth.

        I see far too many people planning and thinking about what they want to do and not producing the content. If you spend 80% of your time producing content and 20% of your time planning out your content, no matter what medium you are producing for, you will see positive results. If you turn that ratio around, you are not going to see much by way of results.

        Stop for a moment right now and ask yourself: “What could I do today that will give me 80% of the results I most desire?”

        Use Your Calendar to Review How You Spent Your Time

        Your calendar is your most powerful analytical tool when it comes to seeing how you spend your time each week. If you see you are spending a lot of your daily time in meetings and dealing with co-worker issues, you will find you are not focused on the 20% where the real results are.

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        If you have taken the time to write down the activities that give you 80% of your results, then review your calendar at the end of the week to see where you are spending your time you will be able to make adjustments; so you are more focused on the activities that give you the biggest positive results. Block time each day to work on those tasks.

        Try to eliminate those tasks that do not bring in much by way of results. If you can do so, delegate them to other people better able to complete those tasks for you so you can spend more of your time each week on tasks. This will give you a much better return on your time investment.

        To really take advantage of the 80:20 principle, you need to be aware of where you are spending your time each day.

        If you are a content producer, then you need to be producing content, not wasting time analyzing analytics. Of course, analytics is important if you want to see growth, but without content, you will not have any analytics on which to base your future content. So 80% of your time needs to be spent on producing content.

        If you are in sales, if you spend 80% of your time planning out your sales calls and only 20% of your time in front of your customers, your sales performance is not going to be very good. Turn that ration around. Spend 20% of your time planning out your calls and 80% in front of your customers.

        Key Takeaways

        So to make the 80 20 rule work for you, remember these:

        • Be very clear about what it is you want to achieve. What will a successful outcome look like? Then identify the 20% of action steps that will get you 80% of the way there.
        • What are your majors and minors? What daily activities could you do that will create constant motion towards achieving whatever it is you want to achieve? Do those every day.
        • Reduce the amount of time you spend thinking about doing something and just start doing it. If you are spending 80% of the time thinking and just 20% of your time doing you have the ratio back to front.
        • Identify which action steps you have taken over the last week that had the biggest positive impact on your goals. Do more of them next week. Prioritise them and schedule the time in your calendar.

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        Featured photo credit: Anete Lūsiņa via unsplash.com

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