Too Good

Recently, a computer consultant was heard to say that he wanted a long term business strategy based on Microsoft Windows. He wanted to be an expert on that platform and thus get a lot of income from his vast expertise.

That's not a good business plan. There is a cost in being too good, having too much expertise on any one technology, or building a business on one product. Like a framing contractor who sees the solution to all problems as simply being the use of a bigger hammer, we can get stuck thinking that what we are doing is the only way to get it done.

When we get good at something, we don't just learn facts, we learn, or intuit, how our world fits together. We gain a mental framework of our world. This allows us to look at new situations and see how the new bits and pieces will fit our knowledge of how things fit together. In other words, we can make judgments much faster than someone who does not have our framework.

But, what happens when we run into something that doesn't fit our framework? We have a harder time learning than someone who does not have such a framework.

The same is even more obvious for companies. A company has an operational framework that is built up from interactions between parts of the company and the outside world. The framework is taught to new employees through the stories told about how things work within the company. This operational framework can be quite strong and when something doesn't fit it won't be accepted by the company. Typically, the more successful a company, the stronger the framework.

This is part of the reason why successful companies have such a hard time identifying and switching when the world around them changes. It is the cost of being too good at what you do.

In order to succeed over a long period, we have to toss out what worked before and start over. Some companies do well at this and others struggle. If you want to explore a new idea, give us a call.

Ideas and Trade

A lot of fury is being made over the importing of labor into this country. People who used to be able to make a living based on physical work are losing out to those who are more desperate for income. Others, who used to make a lot as programmers, have been faced with years of lack of work. While many people will question political policies, the question for us as business people is, "What do we need to keep in mind when facing the challenges of competition?"

_It is the speed at which ideas are passed between people that determines the rate of progress._ --Edward Leamer

In sales, we hear all the time that the physical meeting is important. People do business with people that they like. Economists talk about how distance affects trade. It doesn't matter how good a far away supplier is, it's easier to deal with someone who can show up tomorrow on your door step to work out the problems. When measuring how far trade goes, the distance per trade has remained fairly constant over the last 50 years.

People rarely learn from the abstract or from others far away. In this business, a sale call is actually a learning opportunity. Some people, who have an idea, don't know what it will take to make that idea happen. And one person's ideas are often very different from another person's ideas in the same business. In a good relationship, both sides learn.

While phone, fax, email, and internet have all helped to make it easier to communicate words, they don't always work to get full communication. Some researchers estimate that 90% of communication is non-verbal. That makes email only 10% of what people want said.

--So, would you like to meet?

Risky World

Risk of Software Assumptions
Gene decided to uncheck a box on his Facebook profile relating to his engagement as he felt that there was too much information out there. Unfortunately, Facebook sent a message to all his "friends" informing them that the engagement had been called off. Gene had some complications because of that.

Dave Randolph,
President, Prairie Trail Software

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