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Win/Win

When I was 15 or so, my father called me outside one day and said “the oil in your mother’s car needs to be changed. Come on, you’re gonna help me.”

We spent all day on it. First we drove her car up onto ramps so we could more easily get underneath. We opened it up and let the oil start to drain out into the pan, and while that was happening we looked at the cap to see the specified kind of oil for the car. We drove dad’s car to the store and bought the oil, as well as a new filter. We got back and crawled under the car again to close it up, and then spent time both under the car and under the hood, changing the oil filter, replacing the oil, checking with the dipstick, all that. Then we carefully sealed up the old oil and took it to be disposed of properly, driving mom’s car in the process so that he could make sure everything was okay before giving it back to her.

When we were all done, he asked me: “What did I teach you today?”

I said that he’d taught me how to change the oil on a car.

He said: “No! I taught you the value of twenty dollars! [$20 was the going rate for an oil change at the time.] It’s good to know how to do that stuff yourself in case you need to, but you should almost never do it. Someone else could have done that in ten minutes for twenty bucks, and I could have made more than that doing something else. Now that you saw what a pain in the ass it was, you’ll appreciate spending twenty bucks not to do it.”

He’s a wise man, my father. He intuitively understood a lot of economic concepts (like opportunity cost/comparative advantage!) without any formal study in the subject. I remember another of his lessons: Don’t complain about gas prices. He said “A gallon of gas might cost three dollars. But my car can go fifteen miles on a gallon. Go outside and push my car fifteen miles – hell, just walk fifteen miles – and then tell me you wouldn’t rather have paid three dollars to drive.” He understood next best alternatives, too.

At the core of these lessons is a philosophy for life that can lead to a lot of success: Seek out the win/win scenario.

Paying someone else to change your oil is (for most people) a win/win scenario. You gain time that is worth more than the cost of the service, and the people specializing in that service make a living. Most people make money by making other people’s lives better. We live in an age of miracles and wonders. It’s good to remember it, and be grateful.

More Than You Paid For

Today I’m going to share with you a secret for getting more value than you pay for when hiring someone.

All else being equal, someone with more knowledge and/or skills (i.e. someone able to complete more tasks) is more valuable to you than someone with less knowledge or fewer skills. If you have Applicant A and Applicant B, and they’re identical in all ways except Applicant A can make a spreadsheet and Applicant B can’t, then Applicant A is a better hire for the same money.

Now, let’s do a little math. Let’s say that your time at your company is worth $100/hour. Anything you do needs to, on average, be generating that much revenue or you’re making bad business decisions. You shouldn’t wash the windows at your own company, because you could hire someone to do that for $15/hour, and you could spend the same hour making $100, and thus you’d be $85 richer by hiring someone else.

Now let’s assume that you need to hire someone to do 5 different tasks, and it’s reasonable to roll them into a single position. While you could do the tasks yourself, it wouldn’t be efficient for you to do so, for the reason described above. You know these tasks very well, so you’re hoping to find someone who could do them at least close to as well as you could. You find such a person, and the market rate for them seems to be $60,000/year. Let’s call this person Amy for ease of the hypothetical.

Simple so far, and I probably haven’t said anything you didn’t already know. But now, let me get to the secret.

Let’s say instead of that person that knows those 5 tasks, you find someone who doesn’t know them. Call them Evelyn. Evelyn is in every way identical to Amy, except she doesn’t know those 5 tasks. But she has the same level of general intelligence, character, initiative, etc. So clearly she’s capable of the tasks, she just doesn’t have the knowledge. Because she knows fewer skills, perhaps because she’s earlier in her career than Amy, the market rate for her employment is only $40,000/year.

You are, personally, an expert on those 5 tasks. You could teach them to Evelyn, it would just take time. Many people think they should hire Amy – but if you can teach those skills to Evelyn, you’d be crazy not to hire her.

Why? Well, consider: If you can teach all 5 tasks to Evelyn in 100 hours, you’ve spent $10,000 of your own to do so – but now you have someone working for you for $40,000 a year who is worth $60,000. You’re $10,000 richer in the first year alone, and every year after you’re $20,000 richer. It involved a little more up-front investment of time and energy, but the end result was huge value.

“But what if Evelyn takes these new skills and then leaves for a $60,000/year offer?” Guess what – she will. Eventually. But she won’t do it in the first year, or probably even in the second or third, if you’re treating her well. And if she leaves after the third year, you’ve made $50,000 hiring Evelyn over hiring Amy, and you can do the same thing again with your next hire. And of course there are a hundred other confounding factors that could change that – a raise of $5,000 in her second year makes Evelyn very happy and still keeps her well below what you would have been paying for Amy. Plus, it should never be discounted that you get a lot of loyalty by investing in your people early. It pays dividends.

Why don’t more companies do this? Because this, despite its long-term value, is hard in the short term. You have to have foresight to make hires before they’re emergencies so you have time to train. You have to be willing to put the effort in to train someone. You have to be accepting of some risk. But these are the practices that build empires. And who doesn’t want a good deal on their empire?

Radical Trust

I want to change your life.

I’m going to suggest an experimental course of action for you. It will be difficult for multiple reasons. The first reason it will be difficult is because when you first hear the suggestion, your initial reaction will be to believe you already do it. You don’t.

Here is the suggestion: Just for a day, I want you to believe that everyone that’s speaking to you is telling you the literal truth.

Now, this is a suggestion for your personal and professional life, not political. Don’t watch the news or a politician’s speech and try this, you’ll go mad.

But for the people you interact with personally – your loved ones, your co-workers, etc. Give them your radical trust.

You might think you do this, but almost no one does. When someone is mad at their spouse, and the spouse says “I don’t know what I did wrong,” often your inclination is to hear that sentence as “I don’t agree with you that my behavior was blameworthy; rather I think you’re being over-sensitive.” That, of course, would be a terrible thing to say to someone who is mad at you if your intent was to get them to not be. So when you hear that in your mind, you get even madder – how dare they imply that! But just as an experiment, mind you, consider how you might react if instead what you heard was:

“I don’t know what I did wrong.”

Literally, without sarcasm or ulterior motive. If you truly believed them when they said that, you might soften a bit, realize that they angered or upset you without meaning to, and would genuinely be eager to change their behavior if they knew what hurt you. You might then tell them how you feel and why, and they could realize what they’d done, apologize, and not do it again now that they know how it made you feel.

Imagine someone under you at work comes to you and says “I’m having a little bit of difficulty with this task.” You might be quick to think “Here we go, they’re trying to get out of having to do something, they want me to do half or more of it, or maybe assign it to someone else, what a lazy jerk.” But what if instead you forced yourself to hear:

“I’m having a little bit of difficulty with this task.”

If you gave them your radical trust, you might realize that they’re very eager to perform well, and that it takes a good amount of character to admit when you’re having difficulty and approach a superior about it, and in fact it shows dedication to improvement. If you give them the benefit of your experience to learn from, they could master this task and be that much more valuable to you going forward.

People will sometimes, of course, give you reason not to trust them. But just for today, wipe that slate clean – in fact, cleaner than it’s ever been, even when you first met them. Make a conscious, deliberate effort to clear away your assumptions and biases, and give them your radical trust anew (or for the first time). Take everyone today at their literal word. Don’t read anything into anyone’s statements.

See what it does for you. See if it changes your interactions for the better. And if it does, as I believe it will, try it again tomorrow.

Mallrats

Retail stores are closing at tremendous rates.

Whether its entire chains going under like Toys-R-Us or still-treading-water chains that are just closing lots of stores, the online shopping experience is crushing location-based retail. And for the most part I say – good riddance! For consumers this is pretty obviously a good thing.

But it got me thinking about the retail spaces I see vacant now. I drive by an old Toys-R-Us location pretty regularly. I see a closed-down Sears. There’s opportunity there.

Obviously any real estate is opportunity in some sense, but I was thinking about what you could do with those spaces that would require a minimal level of conversion. Sure, you could bulldoze the whole thing and build an apartment complex, but what could you do with those spaces mostly as-is?

There are many, many businesses that will be location-based for the foreseeable future. Consider a modern American mall. If the one in your town is anything like the ones near me (I’m from New Jersey, the Land of Malls) then it’s probably 75% filled with exactly the kinds of retail chains that online shopping is crushing. But that doesn’t have to be the case!

There are two categories of businesses that I almost never see in a mall, but they strike me as obvious choices. One category is businesses that sell items you want to try first. Take mattresses, for example. While lots of people buy cheap mattresses online, as soon as you get to the more expensive price points people really want to lay on one and make sure it’s comfortable before committing to the expense (or hassle of navigating even a free return policy). As a result, mattress stores are still very ubiquitous, but I never see them at a mall, even though the space is certainly sufficient. Maybe it’s an issue of price point – mall real estate could well be much more expensive than that lot on the interstate, but if malls are failing, surely eventually the price will equalize. Guitar (and other instrument) stores strike me as another like this – my musician friends often tell me that they wouldn’t buy an expensive instrument that they couldn’t play first. And so on.

The other category, of course, is services. You can’t order a haircut online. Amazon can’t deliver you braces (yet). Many dentists are in professional office parks – but would they see more traffic in a mall? (Currently – probably not. But malls at their historical height of popularity?)

I’ve also thought about ways traditional retail providers could keep up with the online shopping surge. Imagine traditional retail spaces not as stores, but as showrooms. You go to a clothing or makeup store and you can try on whatever you want, but if you like a product you just scan its tag with a convenient app on your smart phone, and it’s added to your Amazon cart. No transactions are made in the store – Amazon handles all fulfillment. The result is that customers can still try on clothes, see what makeup actually looks like on their skin tone, find out what that bath product actually smells like, etc., but stores don’t have to handle transactions, they have probably a tenth or less of the inventory management headache (they only have to re-order damaged product or samples that run out, not constantly re-stocking sold items) and thus need less space overall (or the same amount of space could hold a much greater variety of products for display). Theft would be far less of a concern – it’s easier to spot shoplifters when in theory no product should be leaving the store, even legitimately. And no cash on-site means far less potential for robberies as well (although malls inherently provide more safety in that respect as well).

So imagine a mall for the 21st century. You walk in and there are a variety of services on display – barber shops and dentists, massage parlors and painting studios. Fun things like Escape Rooms or even mini-movie-theaters. Mattress stores, guitar stores, and other things like it. Plus a dozen or more small retail showrooms for jewelry, makeup, candles, what have you – all with the app-based setup.

And of course, always the food court.

Mini Movie Theater!

Thanks for coming to my pitch meeting!

I don’t think the movie theater experience will last much longer in America. While box office sales aren’t terrible, they’re definitely down significantly from their peak in the early 2000’s. We’re closer to mid-90’s levels now, and I think the trend will continue downward.

Options for watching at home are simply getting better. I love movies; I would definitely categorize myself as a “movie buff.” As a result, I have a pretty sweet home theater built in my basement. Projector, nice surround sound, all that. Even so, it’s amateur/hobbyist level stuff; I have some friends with way nicer setups. But even my amateur setup is awesome and makes my desire to go to the movies almost non-existent. Combine that with the fact that modern streaming services deliver to me an incredible variety of content options and you can see why I’m not eager to spend $100+ on a night at the movies.

But there are certain facets of the experience that aren’t captured by my home theater. It’s not especially large; it’s designed for my small family unit. I couldn’t host a party of even 10 comfortably. But many of our movie (and even television) experiences are inherently social experiences. Even if you watch by yourself, you immediately want to discuss the latest Avengers movie or Game of Thrones episode with your friends or the fandom online. And I know many people like to actually gather to watch those things together; when 30 Rock was on the air, we used to gather every week at a friend’s apartment to watch and laugh together (30 Rock is still one of the greatest shows to ever air on television, by the way. Fight me.)

Okay, that was a lot of preamble. Here’s the actual idea: Small, rent-able movie rooms. Tagline: “The Best Living Room In Town.”

You walk into what used to be a movie theater. Instead of 20 large theaters showing big movies at specific times, that space is now divided into 160 decent-sized “living rooms.” Each one has incredibly comfortable couches and an awesome screen, and is sized for between 10 and 20 people. You rent the rooms by the hour, and you can watch whatever you want. The business has commercial accounts with every streaming service, so you can watch any Netflix, Hulu, Amazon, HBO, Disney or whatever else you want. It also still gets movie licenses, so you can watch the newest releases, too. Super Bowl Sunday probably has some surge pricing, but watch it here – no clean up, no angry spouse! Want to take your kids to see a movie, but they’re a little rambunctious? It’s cool – the rooms are private and sound-proofed, no worries about disturbing other patrons or forcing your kids to sit in one spot for two hours. Want to get together with friends and binge all of Good Omens or Stranger Things in one day? Split the cost of the room and have fun!

A central area has a decent food court, and you can bring your snacks or meals into the rooms – there are tables in there. Pause any time you like for a refill without missing anything – it’s your room! Want to get your Smash Bros. on? Bring your system, we’ll hook it up for you, and you can play on our awesome screen instead of at your mom’s house. Looking for an awesome party idea? Ask us about our Karaoke options!

I’d like to think of this as the experience of “social watching.” When it’s just your friends and family, you can talk if you want to, pause when you need to, be comfortable, and enjoy spending time together. I’d go!

Back On Earth It’s All You Read About

Everyone’s brain is wired a little differently.

We are bombarded all day by a million pieces of sensory input, firing neurons that crash into our mind like artillery fire. For a variety of reasons, no two brains absorb this information in exactly the same way. Some brains get hit with a neuron from the taste buds carrying the sensory input from a bite of broccoli and react with revulsion; others get that same piece of info and jump for joy. Some people can have two drinks every day of their lives and never become an issue, other people go crazy with the first sip. Some people thrive on conflict, other people run screaming from it.

Our brains are imperfect, leaky machines. We have some influence over how our brains react to stimuli, but it’s far from perfect control. A lot of our lives center essentially on three activities – seeking out the good neurons, avoiding the bad ones, and trying to have some impact on which is which.

Knowing this, there is something I will be eternally grateful for. My creator, whatever it might be, has given me many gifts. But none compare to the fact that my brain is wired in such a way as to be utterly overwhelmed by music.

Nothing else compares. Not even close. In my past I’ve been so drunk I couldn’t stand (horrible). I’ve tried drugs (not for a very long time, thankfully). I’ve had my heart broken. I’ve completed marathons. I’ve lost loved ones. Nothing has given me the depth of feeling and altered my mental states like music can. Even the things in my life that have made me truly happy, like the births of my children, made me happy in a serene and joyous way, but it didn’t feel like my mental state was actually altered. It was a rational happiness.

Music isn’t like that. The right song can bring me utter elation or hit me in the chest like a hammer. The right song can make me beat my personal best in physical activities or reduce me to tears. I’m completely at the mercy of music.

I wouldn’t trade it for anything.

The Owner of The Sphere

People love to feel persecuted, like the world is out to get them. There’s a vast conspiracy stacking the deck against you – your failures are due to opposition from shadowy forces bent on your destruction!

The reality is much more freeing – no one cares about you. People writ large are barely aware of your existence. This is absolutely marvelous.

Think about the freedom you have when you realize that almost no one cares if you succeed or fail. No one is out to get you, no one is watching you, and most people won’t remember you. You can do anything! You’re free to fail a thousand times and no one will bat an eyelash, and when you finally find your tremendous success, only then will some people care. And for the most part, the only people who will care will be those directly affected by your triumph – you’re inner circle of loved ones and the customers of your successful enterprise. No one else gets a say, and you don’t owe them anything.

One of my absolute favorite pieces of prose is from Ralph Waldo Emerson, and it goes like this:

“I am the owner of the sphere,
Of the seven stars and the solar year,
of Caesar’s hand, and Plato’s brain,
Of Lord Christ’s heart, and Shakespeare’s strain.”

What exists in all the universe, exists in you. What is able to be accomplished by any human is within your grasp. You are made of the same amazing raw material as anyone – they had nothing you don’t have.

Look at this wondrous world! You have amazing abilities and no opposition. You’re Superman without Kyptonite, without Lex Luthor. You can do anything!

One more quote, another of my favorites. Put it somewhere you’ll see it every day.

“You have brains in your head. You have feet in your shoes. You can steer yourself any direction you choose.” – Dr. Seuss

Reflection

Today marks the end of my first full month blogging every day.

Due to what is sometimes an odd schedule on my part (I have three kids and terrible insomnia) sometimes the “once per day” ended up being technically twice on a given day as I would sometimes write after midnight, but I’ve definitely kept myself dedicated to it and I’m happy with the results. I think it’s healthy, I find it fun, and I have no intention of stopping any time soon.

I think there’s a secret strategy here that I’m realizing. You don’t have infinite time in every day. You have to make things a priority if you want them to happen. And if you fill your days with healthy and important things, you won’t have time for bad habits.

It’s hard to not do something. To kick a bad habit. If you smoke, it’s hard to quit. One of the reasons bad habits are hard to kick is because trying to focus on not doing something is essentially the same as focusing on that thing – either way, it’s central to your thought patterns. If all you do all day is focus on how much you want to stop smoking, you’re still thinking about cigarettes all day, every day. That will make it hard to actually quit.

I have no scientific data to back this up, but I’ve always thought that if I wanted to quit smoking (I never started, thankfully), a good strategy would be to take up swimming. You can’t smoke while you’re swimming, and grabbing a quick smoke would be inconvenient if you were doing laps in an indoor pool in a gym. Basically, you fill your hours with healthy activities that leave no room for the unhealthy ones. At the very least, you’d cut down considerably.

So don’t try not to do bad things. Instead, just fill your time with such healthy habits that you don’t have time to do anything else. Now that I’ve got a little time every day dedicated to blogging, it’s time to put the next block in the foundation and dedicate a little more time each day to something else. I have a few ideas on what that will be – and since I have a blog, I’ll keep you updated on how it goes!

Someday There Won’t Be Spotify

I used to own more books, by weight, than all my other possessions combined, including my car.

Some people would probably salivate at that idea, but I found it smothering. I find almost all physical possessions smothering, in fact. My constant goal is to keep the total volume of everything I own able to fit in the trunk of a car (minus the car itself, of course). With three kids that’s impossible, but at least my stuff still fits in that space.

However, I love reading. In fact, I love media in general – books, music and movies all bring me tremendous joy. My life was therefore enormously improved by things like Netflix, the Kindle, and Spotify. These things allow me to access all the things I want without the physical burden. It’s wonderful.

Not only is it wonderful to avoid the physical anchor, but those things also allow me access to vast and varied quantities of media that I simply would never have seen otherwise. I’m old enough to have listened to music well before MP3s and Napster, let alone iTunes and the like. I had cassettes and CDs. I had VHS tapes. I had… well, books.

Even then, I hated them. I wanted what was on them, but collecting the objects themselves always felt like buying the bricks to my own prison. Now, I can listen to ten new bands in an afternoon, I read 5 or 6 times as many books as I did before I got a Kindle, and I can check out movies I’d never heard of and find great hidden gems.

All those devices and services lowered my opportunity cost for media consumption. In turn they’ve also lowered the opportunity cost for content creators to do so, since it’s easier now to distribute what you’ve created to a wide audience. And traditional gatekeepers are losing power – it’s easy to self-publish on Amazon, putting your music on Spotify is cheaper than pressing CDs, and streaming services make their own shows and movies outside of Hollywood. I love it all.

One thing it does make me think about – I wonder how it will all evolve from here. I can’t wait to see – I have tremendous faith in human progress, so I have no doubt it’ll be good. But someday some other model will be even better than Spotify and will thus put Spotify out of business, and I wonder what it will be.

Music, books, movies – these are the thoughts and feelings of our collective selves, and consuming them is communion with humanity. It’s exposure to a vast assemblage of minds, and I enjoy every second of it. I love that I can do it more efficiently now than ten or twenty years ago, and I look forward with great anticipation to the world twenty years from now, when I can enjoy it even more.

Usefulness

I think many companies are too large for their own good.

There are plenty of benefits to size. Economies of scale, the ability to leverage great resources, the ability to weather larger storms than a smaller company might. But there are also plenty of things a larger company misses out on, and they can be harder to see.

I’ve worked for companies with more than 10,000 employees. It’s very difficult to make a significant impact. Once a company reaches a certain size, its inertia begins to take on a life of its own, absorbing shocks – both good and bad. Certainly that can mean defense against bad ideas, but that same aspect insulates against good ones.

It’s difficult in such an environment to make yourself useful. You can perform your job well, but if you’re an ambitious person who wants to change things for the better, you’ll find yourself blocked at every turn. That might be in the company’s best interests – after all, you’re not the only person who wants to shake things up, and not every idea can be good – but it’s certainly not in yours as someone who has big goals. You trade the ability to take big swings for a certain level of security.

The long-term effects of that culture on your talent pool begins to show, however. Larger firms attract people who want to play it safe, who are comfortable never sticking their head up. There are many ways that good leadership can fight against this effect, but it’s always a fight. Left on its own, that structure is smothering.