How We Succeed
One of my mentors in business (frequent guest contributor Bruce Rhoades) would often talk about the power of business experiments. He would advocate trying something in a small way, testing it, learning, and then releasing it fully only after the test. By doing this, we would improve the customer experience dramatically, release products that were more aligned to customer needs, and price services optimally. That’s why I appreciate Steven K. Gold’s new book, How We Succeed: Making Good Things Happen Through the Power of Smart Experiments. Steven’s extensive entrepreneurial, consulting, and academic experience informs every page of this book. I reached out to discuss his work.
“Most of us lose the motivation to do intelligent experiments because of our schooling, rote jobs, bosses who set the goals, etc.” -Steven K. Gold, M.D.
3 Factors Critical to Achievement
You begin the book by talking about the three factors that are critical to high achievement: experiments, relationships, and expertise. Most people wouldn’t think of experiments, the focus of your book. Why is it often overlooked?
Experiments are something we do as children. Think about a child learning to walk, meeting someone new, or exploring a playground. They try things, fail a lot, and quickly learn and grow. Then, as we enter school, things change. We are told what to do, and goals are set for us: pay attention, study hard, take the test, get a good grade. Beyond the frustration that this causes for so many of us, it destroys our experimental nature. Most of us lose the motivation to do intelligent experiments because of our schooling, rote jobs, bosses who set the goals, etc.
“Experiments are the only strategy for succeeding over the long term.” -Steven K. Gold, M.D.
What is your definition of a Smart Experiment?
An experiment, in general, is an investment of one’s resources – time, energy, knowledge, expertise, relationships, money, and more – to explore the world and learn something new. Furthermore, like anything in life, we can do it poorly or well. A Smart Experiment is one that uses a particular process. I didn’t invent this process, however – in a way – I rediscovered and summarized it in my book. There are ways to do our experiments well. The better we do our experiments, the faster we accumulate new resources in order to grow. This holds true in our personal and professional lives, as well as for the organizations we lead.
4 Steps of a Smart Experiment
What steps are involved in a smart experiment?
Smart Experiments involve four steps:
Look around and assess your available resources. What resources do you have – human connections, material, knowledge, expertise, experience, finances, etc. – that you can combine in possibly creative ways to design a possible experiment? Make formal or informal lists of all of your possible experiments. The more possibilities you have, the better.
Given a long list of possible experiments, you want to categorize them. This should be an ongoing process in light of new resources, for example. Any possible experiment that has been Designed in Step 1 can be placed into one of four categories: a) do it now, b) do it later, c) find a partner, or d) forget about it. This prioritization determines what you do next.
Before embarking on a “do it now” experiment, you want to de-risk the experiment. This means you identify potential hotspots and prepare for them. This step anticipates that certain easily predictable and fixable issues are critical to successful outcomes, and so you want to be proactive. It’s like packing a first-aid kit for the things that are most likely to go wrong.
Having completed steps 1-3, it’s time to do the experiment, which typically involves taking small steps, one at a time. Since every Smart Experiment is an investment of resources intended to secure more valuable resources, you also want to take care to harvest all of the value that results from your experiment. Don’t walk away from any value that’s created.
“You will learn a lot more about climbing a mountain by doing it versus reading about it.” -Steven K. Gold, M.D.
Is there a step we are more likely to dismiss or ignore?
Many of us tend to want to accelerate towards the final action, which sometimes works, but isn’t smart. Smart Experiments are an iterative process that continuously cycles through all four steps. Keep in mind that kids do it, and it’s intuitive, but many of us need to relearn the process. So, I’d say the first step – Design – is the one people tend to skip. If we skip it and short-circuit the process, then we miss out on one of its most beautiful benefits: understanding the wealth of resources we really have, and also the many opportunities that they lead to. If we skip the first step, it’s like walking into an ice cream shop and being able to order only one flavor. On the other hand, by assessing and combining our available resources, we can create a full range of flavors, possibly including several that have never been seen before – and at least one or two of these might taste really good. Please forgive the metaphor, but ice cream is universal.
“By failing to prepare, you are preparing to fail.” -Benjamin Franklin
Would you share an example of a common experiment?
Everything we do that takes time and effort – along with other resources – is an experiment. That pretty much describes everything we do in life. For example, cooking is an experiment. You assess the availability of ingredients, combine them in certain ways, and perhaps then stick the mixture in an oven. You never quite know what’s going to come out of the oven. If you’ve done a Smart Experiment, then even if the result is sub-par, you still get something out of the effort, such as knowledge about how to cook the ingredients better the next time. Leading a large corporation is pretty much the same thing as making toast, at least when it comes to doing Smart Experiments. The best leaders have active resource awareness; are always dreaming up ways to ‘connect the dots’ that others may not see; know how to prioritize which experiments should be done; foresee risks lurking in the darkness; and delegate or oversee execution.
“The best journeys answer questions that at the beginning, you didn’t even think to ask.” -180 South
Many employees are afraid to try something new because they could fail. How do business leaders cultivate a culture of experimentation and empowerment?
The best leaders are role models. They do Smart Experiments themselves, demonstrate that intelligent risk-taking will not be punished, and that intelligent effort will be rewarded. They still celebrate success like everyone else, however they celebrate even more when people take the initiative to pursue an opportunity to the best of their ability, irrespective of outcome. That’s a celebration of courage, effort, and intelligence – and it reinforces the right kind of behavior.
Giving others permission to do Smart Experiments is the ultimate in empowerment.
“Giving others permission to do Smart Experiments is the ultimate in empowerment.” -Steven K. Gold, M.D.
Recently I’ve been reading and studying about the power of continuous learning in life, and how some people have this mentality more than others. Do you see a link between experimentation and mindset?
It’s such a great question. Learning – such as through books and courses – is simply one mode of experimentation. Remember that an experiment is an investment of one’s resources – such as time and energy – to learn and grow, and acquire new resources, such as knowledge or skill.
That said, the kinds of continuous learning we often think about – such as online courses these days – pales in comparison to getting out into the world and doing things. You will learn a lot more about climbing a mountain by doing it versus reading about it. You will learn so much more about the possibilities of a business relationship by taking action and just developing the relationship in small steps. And as the best business leaders know, you can only learn certain things – I call them the ‘mechanics’ of business – in business school. Only by leading real people in real life, and experimenting with leadership itself, will one become a true leader.
By the way, as we both know, being a true leader involves quite a lot of humility, and I’d argue that this takes regular reflection. So, becoming and being a great leader is only possible with lifelong, or continuous, smart experimentation, along with everything that entails.
“Only by leading real people in real life, and experimenting with leadership itself, will one become a true leader.” -Steven K. Gold, M.D.
Your previous book offers practical advice for entrepreneurs. Entrepreneurs seemingly would open to your message of experimentation, failure, etc. and thus easily gravitate toward it. How do you encourage those who are not as open to risk to go on this experiment journey?
Today we are all entrepreneurs. Entrepreneurs are people who invest resources into uncertain endeavors, such as a business that doesn’t have a product yet, doesn’t have a team, or hopes to define a new market segment, as examples. The pandemic is one example of how uncertain this world really is. If the world were certain, we could all just follow a set of instructions and repeat what we know, day in, day out. Given that this isn’t the case – and the best leaders have always known this – experiments are the only strategy for succeeding over the long term, sustainably. Furthermore, Smart Experiments are not about taking risks, but instead about risk mitigation and staying safe. In some ways, mature leaders understand that the world is a playground. The stakes are higher, but it’s still about exploration, staying safe, learning and growth.
For more information, see How We Succeed: Making Good Things Happen Through the Power of Smart Experiments.
Photo credit: Christian Fregnan.