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Friction (1): costs to convenience

Friction is anything that makes it harder to for us to get something done – buy a product or use a service, do our jobs, learn something, enjoy ourselves.

There will always be friction – but poor design and execution and a lack of clarity about what things are for make it worse than it needs to be. For example:

  • unhelpful bureaucracy
  • long waiting times
  • extra travel
  • clunky interfaces
  • running things in series when they could be run in parallel
  • running things in parallel badly (e.g. grinding coffee and getting the milk out of the fridge before starting the kettle boiling)
  • Unnecessary approvals
  • lack of information (including opaque information) about what’s available, when and how, how much it costs, and other requirements
  • Dispersed or contradictory information
  • excessive security or controls compared to the risk (and always if poorly executed)
  • choke-points in buildings, single-checkouts in busy supermarkets
  • A lack of standards or consistency (think of Wi-Fi, electrical voltage, computer connections, weights and measures)

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How to set salaries

Some ways of thinking about setting salaries:

Market Rate

You pay the lowest price that the market will bear. The bigger the market (the more appropriate candidates that you can reach), the lower the price is likely to be. This is commodity pricing: an average sort of price to attract average (or cheapest possible) candidates.

Market-plus

You pay the market rate plus a bit, fishing for better-than-average candidates or at least that your recruits will work better for you as a result of higher pay.

Market-minus

Sounds silly, but it’s quite common in the world of non-profits. You pay a little below market rate to filter out people who are in it for the money, as opposed to those who value the work itself, share your vision, are committed to the cause.

A living wage

You come at the pricing question the other way round – not “What’s this job worth?” or “What’s the lowest wage I can get away with paying for this work?” but “How do I think members of my team should be able to live?” This could end up being below market, in which case you end up with another values-filter, or above market, in which case you risk looking wasteful or attracting people who want to work for you for the wrong reasons.

I like the idea of starting from a living-wage – and if it looks too generous:
a) It’s a better mistake to make than being stingy
b) You’ve got the interesting problem of helping your recruits to be worth it.

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Podcast Recommendation: Econtalk with Alain Bertaud on Cities, Planning, and Order Without Design

This is a great episode of Econtalk. Bertaud uses labour markets as a lens for thinking about cities. Helpful examples of emergent order and the challenges (impossibility?) of planning in complex adaptive systems.

Highlights (coming up) include:

  • Discussion of the importance of culture and context in how cities develop;
  • Bertaud’s explanation of his broader-than-usual understanding of labour markets;
  • When planning and regulation is helpful and when it’s damaging;
  • The trade-offs made by new arrivals in a city (and the danger of planners trying to decide these for them);
  • The way that property markets can turn development costs into opportunities.

Highly recommend.

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Finishing lines (4) – two numbers

Here’s Seth Godin with some of the best advice I’ve heard for drawing (finishing) lines. It’s especially relevant for businesses.

Q: I’m wondering about personal financing your company and where you draw the line if you’re funding it yourself?

Rule number one is you never put up your house. Don’t laugh. This means you can’t sign a personal guarantee on anything. “You want to rent this? Ok I’ll rent this, but I’m not signing a personal guarantee on anything.”

I have not signed a personal guarantee. I was bankrupt for eight years. I was this close from having to close down for eight years and I still never signed a personal guarantee for anything. That is a line I have chosen to never cross and I encourage everyone to do. The minute you do, suddenly there’s a 3-year-old at home who’s going to have to live on the street if you make a mistake. I just don’t know how to take risks when that’s at stake.

Then the advice that I give people is, if we’re going to be intentional about this, you need to write down a number and a period of time.

The number, it can be as big a number as you want, is the maximum amount of money under any circumstances no matter what that you’re willing to put in. And when you hit that number you can’t put in another penny.

People hate this. They say, “But what if something blah, blah, blah.” NO. There just has to be a number.

The second one is, “How much time before you give up?” And again, it can be 20 years. Fine. But you can’t say, “19 years and 11 months into it, but wait there’s one more deal that might come through.”

You just have those two numbers because if those two numbers are in place and your spouse is aligned with it, you never have to worry about it again. It’s off the table.

This whole situational thing, “I just need $2,000 more,” that’s lying to yourself. The discipline early on is so valuable because then you can spend 100% of your time focusing.
…

So you raise more money than you think you need and you treat it like it’s the last money you’re ever going to have. It’s way better than always wondering where that next nickel is going to come from.

Seth Godin – Start Up School Ep 11: Cash Flow
From a transcript by Kevin Evans
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Finishing lines (3)

In the probably-quite-unlikely event that your project will last longer than you do – or at least lasts longer than your desire or ability to keep it alive – you’ll need to have a personal finishing line in mind.

  • When, ideally, will you let go of the project?
  • What state do you hope to leave it (what needs to happen so that you can leave without killing it?)
  • Under what circumstances will you leave before the ideal time?
  • What do you need to do and how do you need to frame your departure so that you and others feel good about you leaving?
  • Will it be a clean break, or are there ways you’d continue to support the project?
  • If things go wrong after you leave, what circumstances (if any) would drag you back?
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Finishing lines (2)

Recognising the possibility – or rather, the inevitability – of the death of your project will focus your mind:

  • Given that we can’t do anything in the time available, what’s most important?
  • Will people miss us when we’re gone?
  • Will your project’s main legacy be something physical you’ll leave behind, or an idea or value, or a change in people?
  • Given that the cause that motivates your project will probably remain, what can you do to seed new projects and make it possible for new people to pick up the ball?
  • How can you avoid a painful decline and death-spiral – that is to say, how will you make sure the project dies well?
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Finishing lines (1)

Or

The Physical Impossibility of Death in the Mind of Someone Living

Artwork: Damien Hirst Image: Chaostrophy (Creative Commons BY-NC-SA)

The Physical Impossibility of Death in the Mind of Someone Living

Where are the finishing lines for your project?

Some projects get finished up and wrapped up neatly, others (often work serving people, like education or government) are by nature never finished.

If your project has no clear finish line, it’s worth considering making an artificial one. It could be after a defined length of time or based on contribution: after you’ve achieved a certain goal, had a defined impact… or if something doesn’t happen by a certain timeframe.

Your cause will rumble on (many of our best causes will do so for as long as there are people), but it’s naive (and unhelpful) to think that your project will last forever, at least in its current form.

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Keepy uppies

Try playing keepy uppies with your projects:

  • Do something every day, however small, to move them on and keep them alive
  • Find friends for the project – people doing similar work, people interested in what you’re working on – and maintain a conversation about what you’re learning
  • Keep half of your free moments empty – moments when you’d pick up your phone, snatch five minutes reading a blog or book or watch a video – and think about your project, keeping your head in the game
  • When you learn something new, take the time to think about (or even better, articulate clearly and write down) how it might apply to your project

The ball’s in your court – keep it in the air.

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Leg ups

It’s easy to recruit people or find partners if you lower your standards, but you almost certainly shouldn’t – apart from anything else, when will you stop?

A more useful approach is asking what you can do to help people get to the starting line. You might:

  • Get better at finding to the right people at the right time;
  • Be clearer about what attitudes and skills people need to bring with them if they want to work with you – and how they can demonstrate that they have them, and how they might gain them if they don’t;
  • Be clearer about the value that you offer to people working for you or with you – communicate it well, and make sure you keep your promises;
  • Think carefully about how you could be more accessible and flexible – and where you can’t or won’t be;
  • Learn to train and manage people twice as well as you do now – and think about how you might train people outside your organisation – what could you make and share?

Who do you most want to give a leg up?

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Starting line

Where’s the starting line for your project?

How good does someone need to be to…

  • Work for you?
  • Work with you?
  • For you to work for them?

What type of ‘good’ are you looking for?

It’s highly likely that the best contractor / employee / partner / donor / customer isn’t simply the cheapest / most available / one with the most money.

In most cases, a person’s qualifications will tell you little or nothing about what they actually have to contribute, or what they might drain from you and your team.