One of my early business mentors told me “you have to be half the price or triple the value for someone to switch from their current provider”. People don’t switch from Sears to Amazon for a couple of pennies… the new had to be much better than the old.
If you were competing with yourself, or competing with your business – how would you attack? Where is that weakness? Fix that. Don’t wait for the customers to discover that someone else does it for half the price or triple the value… because it will be very hard to get them back.
Nothing brings more opportunity into your life than speaking well in public.
I have been teaching for 16 years on many leadership programs at IESE Business School. Today I’m sharing a playlist of a series of videos that we put together as an introduction for participants of future courses.
There are 10 videos in the full playlist with a total duration of about 60 minutes.
If you are to build a great business, you need to know how to hire great people. There are 3 things you want to see in a person to know that they will make a lasting positive impact on the organisation.
Can they do the job today
Will they do the job long term
Do they fit with the team
What do you look for in people when you are deciding whether to make an offer? What red flags have you identified?
In his TED talk, Stephen Duneier explains that what defines him are not titles, but an approach to decision making that transformed him from someone who struggled with simple tasks to a guy who is continuously achieving even his most ambitious dreams.
For thirty years, he has applied cognitive science to investing, business and life. The result has been the turnaround of numerous institutional businesses, career best returns for managers who have adopted his methods, the development of a $1.25 billion dollar hedge fund and a rapidly shrinking bucket list.
“Every one of my report cards basically said the same thing: Steven is a very bright young boy, if only he would just settle down and focus.”
“What they didn’t realize was I wanted that even more than they wanted it for me, I just couldn’t. And so, from kindergarten straight through the 2nd year of college, I was a really consistent C, C- student. But then going into my junior year, I’d had enough. I thought I want to make a change. I’m going to make a marginal adjustment, and I’m going to stop being a spectator of my decision-making and start becoming an active participant.”
“And so, that year, instead of pretending, again, that I would suddenly be able to settle down and focus on things for more than five or ten minutes at a time, I decided to assume I wouldn’t. And so, if I wanted to achieve the type of outcome that I desire – doing well in school – I was going to actually have to change my approach. And so I made a marginal adjustment. If I would get an assignment, let’s say, read five chapters in a book, I wouldn’t think of it as five chapters, I wouldn’t even think of it as one chapter. I would break it down into these tasks that I could achieve, that would require me to focus for just five or ten minutes at a time. So, maybe three or four paragraphs. That’s it.”
“I would do that and when I was done with those five or ten minutes, I would get up. I’d go shoot some hoops, do a little drawing, maybe play video games for a few minutes, and then I come back. Not necessarily to the same assignment, not even necessarily to the same subject, but just to another task that required just five to ten minutes of my attention. From that point forward, all the way through to graduation, I was a straight-A student, Dean’s List, President’s Honor Roll, every semester.”
“I then went on to one of the top graduate programs in the world for finance and economics. Same approach, same results. So then, I graduate. I start my career and I’m thinking, this worked really well for me. You know, you take these big concepts, these complex ideas, these big assignments, you break them down too much more manageable tasks, and then along the way, you make a marginal improvement to the process that ups the odds of success in your favor. I’m going to try and do this in my career. So I did. I started out as an exotic derivatives trader for credit Swiss. It then led me to be global head of currency option trading for Bank of America”
Mr. Duneier teaches graduate courses on Decision Analysis in UCSB’s College of Engineering. His book, AlphaBrain is due for release in early 2017 from Wiley & Sons. Through Bija Advisors, he helps business leaders improve performance by applying proven, proprietary decision-making methods to their own processes. His artwork has been featured around the world and is represented by the Sullivan Goss Gallery. As Commissioner of the League of Professional Educators, Duneier is using cognitive science to alter the landscape of American education. He is the former Head of Currency Option Trading at Bank of America and Emerging Markets at AIG International.
The more choices you make throughout the day, the harder each one becomes for your brain. As it tires, your brain looks for shortcuts. The 2 most common decision avoidance tactics are:
to act impulsively (without seeing the consequences of the decision)
to procrastinate (do nothing)
Taking decisions takes willpower. Willpower is a form of mental energy that can be exhausted. It is like a muscle that gets fatigued with use.
There are a limited number of good decisions that one can take in a day. You might be a more effective decision maker than those around you, but you will still have a finite limit on the number of good decisions you can take in a day.
How do you Ration your decision making?
In the toughest days of my life as a CEO – dealing with the fallout from the collapse of Lehman Brothers and the collapse in bank lending at the end of 2008 and beginning of 2009, I hit my limits of decision fatigue. In order to get through the weeks and have energy to deal with the things that would allow us as a business to get through these tough times, I rationed my decision making.
The first step was to specify when and where I would take decisions. (Initially… when: on a Friday; where: only in my office). Previously my team would approach me at any time in the day, over coffee, over lunch, via email, via sms to request budget for small projects or permission to do some new activity. I felt responsable as leader for providing an immediate answer. It was killing me and leaving me with no energy to dedicate to building our future once we survived the immediate crisis.
“That’s great, bring it on Friday…”
I decided that I would take all budget decisions on a Friday between 9-12. If someone came to me with a request, I learnt to say “that’s great, bring it on Friday and we can take a decision”. It was hard at first, people were frustrated and angry and didn’t like my lack of willingness to engage at the time and place that they wanted. Over the following months, the people around me learnt to plan ahead and bring the information necessary to take a good decision on the Friday before they needed the decision.
It gave me peace at lunchtimes, in the break area, even in my office when someone opened the door on a Tuesday. It was a challenge to remove my sense of responsibility to decide at all moments. I learnt to be able to have a conversation where I could contribute ideas, but allow it to be clear that no final decision would be taken during this discussion.
When One decision is not really One decision…
My wife realised that one of her struggles with going to the gym is that it was never just one single decision. Each trip to the gym was a series of decisions: do I change at home or at the gym? do I shower at the gym or at home? will I eat there or not? which t-shirt will I bring? which trainers will I use today? which bag will I use? As the idea of gym came up, her brain knew that it would be exhausted by the series of 20 decisions. Her solution? She wrote down all the questions that she used to ask herself and wrote the answers. She make going to the gym become one simple decision, with a written template of pre-decided answers (shower=yes, trainers=blue, eat=there…)
In Vistage one of the first processes of change that we see in a new CEO member, is a greater awareness of which decisions they should be taking and which decisions they should not be taking.
Are you taking €10,000 decisions, €100 decisions or €1 decisions?
If you are taking the €1 decisions, your brain’s decision willpower will be depleted before lunchtime.
If you are taking the €1 decisions, your €10,000 decisions will not be receiving the analysis and impact that they deserve.
Jack Welch spoke about the size of decisions that he allowed himself to be taking. GE is a multi-billion business. As leader Jack allowed himself to only be taking decisions that could affect at least $50M of the market capitalisation.
Steve Jobs is famous for having a wardrobe full of identical blue jeans and black t-shirts. It was not a fashion decision, it was a conservation of decision willpower for the important decisions of Apple. Barrack Obama speaks about a similar challenge as President of the USA. He set up a structure around him that ensured that he would take no more than 5 important leadership decisions in a day.
The Structure of Leadership Decision Making
The Vistage Decision Model captures 60 years of experience of working with CEOs as they take operational and strategic decisions to lead their companies and their lives. There are 3 levels of Decision “skill” – Instinct, Judgement and Perspectives. There are 5 areas of leadership decision: Talent, Operations, Financials, Customers and Leadership Style.
This video is inspired by George RR Martin and his view on leadership and the price of power. Kouzes and Posner in The Leadership Challenge show that being a good person gets the greatest effort out of the people around you, but just being a nice person can mean you avoid the really tough decisions of Leadership.
What’s the toughest leadership decision of all time? Answer below the video…
Tough Leadership Decisions?
The toughest decision of Leadership: Odysseus’ choice between Scylla and Charybdis.
I’ve been part of Entrepreneurs’ Organisation for the last 10 years and for almost any significant decision I have taken in the last decade, there are 9 people in my forum group who have helped me take a better decision. I would share with them:
the background to the decision
the why of the decision
what I’m seeking to achieve in my life
There is no major decision I’ve taken in the last 10 years that has not had at least those other 9 wise brains also looking at it. They are also giving me different perspectives, helping me think through:
Who I am
What what my strengths are
What my company strengths are and
How I can better play into the opportunities that I have
My question to you: “how many brains do you get involved in the big decisions you have to make?”
If it is just one brain (your own) then you are really going to struggle over your life as a business leader. Join Vistage, join EO, join Young Presidents’ Organization… Get into a peer group where others can give you multiple different perspectives, different ideas, different experiences that have worked for them in the past.
Get as many brains as you can to help you take important decisions, to help you think through the problems you face, to see how to seize (or say no to) the opportunities coming into your life.
Get access to brains to share your problems. Ask lots of questions and get as much coming back from other’s life experiences as you can.
There is a saying: “if you’re the smartest person in the room, find another room.”
Are you the smartest in the room? If you find that you are often the smartest person in the room, you’ve got to expand your network. Get out of that room and get yourself onto a bigger playing field.
Peer Group Organisations
Vistage (requirements: CEO of €5M+ turnover business)