Every time you say a yes, you are saying no. Opportunity cost – a simple concept in theory.

One of the best practitioners of opportunity cost that I know of is Seth Godin. There are 2 examples that I think about from time to time.

The first was when I emailed Seth asking him if he would be willing to do an interview. His response, as is the norm, was quick and straight to the point. He said “Sorry, I wouldn’t be able to do it justice.” I loved the words – “I wouldn’t be able to do it justice.” Exquisitely chosen. Clearly, he’s had a lot of practice at this.

The second example was when I thought about Seth’s approach to blogging. He just shows up, posts, and leaves. I think he’s got an automated script that shares his posts on Twitter and Facebook. He doesn’t engage on either platform and has turned off comments on his blog. And, yet, his blog is as successful as it gets. It’s not that Seth doesn’t engage – he’s as approachable as anybody. It’s just that he takes a clear stand on where he will and won’t engage.

Both of these examples are representative of Seth’s approach to time and work. This may not work for you and me because his priorities and approach is likely to be different from ours. But, his approach is telling. I learnt 3 things from the exchanges I had with Seth –

1. When you are saying yes, you are always saying no. Always. You can’t do everything. You will piss a few people off. And you just need to accept that.

2. Understand your priorities. If you want to make a positive difference in the world, then cultivate the discipline to say no to projects that don’t contribute to that. It begins with your priorities. Always.

3. Before you say yes, ask yourself if you will truly be able to do it justice. If the answer is no, don’t say it. It might seem like you’re making the other person happy. But, that’s just the short term. It’s not going to end well.

And, one last thing – if it helps at all, find people who do this well and take inspiration from them. Whenever I think of priorities and saying no, I think of Seth.

Thanks Seth.

 Pricing Amazon Web Services – The 200 words project

Here’s this week’s 200 word idea from The Everything Store by Brad Stone.

Amazon Web Services (AWS) allows entrepreneurs to plug into Amazons Servers and use it’s computing infrastructure. The AWS team wanted to price it with a traditional monthly/yearly rental system.

 But, CEO Jeff Bezos shifted the focus completely –

1. He decided to create an electric grid model where you pay 10c/hour of use. This was ridiculously cheap but he knew companies like Microsoft and Google wouldn’t want to play this game as it would constrict their generally high profit margins

2. He thus played to Amazon’s greatest strength – building large scale low margin businesses that attracted customers. He actively avoided what he considered Steve Jobs’ biggest mistake – making the iPhone so fantastically profitable that it attracted so much competition that ended up eating its market share. He believed high margins attracted competition while low margins attracted customers.

 When moving into a new territory/project, let’s channel Bezos and remember to play to our strengths.

 PS: The graph below illustrates this beautifully. Despite increasing revenues, has almost never made a profit – intentionally.

(If you look very closely, you can see that in 2010 the company accidentally made a profit. )
Source and thanks to: Benedict Evans’ blog

 ‘One thing is easy to agree on, though: competing directly with a company like this is very hard. ‘ | Benedict Evans on Amazon’s profit graph

Making your own agenda

When Viktor Frankl and hundreds of others were taken to a concentration camp, the Nazis had a clear plan for them – inhuman pain and perhaps painful death. Viktor Frankl, however, had different plans. He had his own agenda – understand human behavior by observing the behavior of his fellow prisoners.

There were hundreds of Nazi soldiers bent on making sure their plans were executed but Viktor Frankl’s clarity of thought and strength of will saw his through. As we know, it not only “just” saw him through but it lead his immense contribution to the world of psychology and the science behind happiness.

We are often pulled into events that weren’t part of our plans. Sometimes, like Frankl, we don’t have full control of these things. But, like Frankl, we do have a have a choice to make sure we think about and stay true to our agenda. Most experiences are what we make of it. It is perhaps no coincidence that we talk about “making” a difference.

Of course, it starts by making your own agenda.

Integrity in action

Follow up is integrity in action.

In that instance when you and I promise to follow up, we begin a test of our integrity. We’ve made a commitment. The big question – will we keep it?

This follow up promise may be to ourselves or to others, may be light or serious – it doesn’t matter. The nature of the promise doesn’t matter either. It could be a first draft of a presentation to the CEO, a commitment to study, a promise to clean the house before your spouse gets in, or your word to join friends for a trip to the bowling alley.

As far as integrity goes, it’s all the same. We’ve made a commitment and the question hasn’t changed. Are we going to keep it?

Follow up is integrity in action. Take your own word seriously or you will stop doing so over time and everyone you know will follow your lead.

Is failure bad?

Nikki Durkin, founder of 99dresses,  had a great post up today on the failure of her start-up. She describes the crazy journey in great detail and talks about her emotions following the failure.

“Most startups fail, and yet this industry doesn’t talk about failure nearly enough. I’d encourage anyone who has failed to write about how it felt, as I can’t tell you how much that would have helped me in those final months & weeks. I just wanted someone to relate to. Instead, I was left feeling isolated and ashamed.”

I was thinking about failure this morning as a few people had commented to one of my teammates on the Real Leaders Project that our “yeah, we quit” post felt negative. That is the exact opposite emotion I felt as I posted that. Somehow, the feeling was one of relief. We tried something, we screwed up, and we felt it was time to move on. Ours was only a weekend project in the grand scheme of things and yet, there was negativity associated with our failure to make it work.

In some ways, I can empathize with how Nikki must feel after 4 years of investment of sweat and tears. I can’t say I understand completely as I haven’t gone through the same experience myself – certainly not nearly at the intensity and magnitude of her experience. I have failed a fair bit though and can feel a part of her pain.

So, is failure good or bad? I think it is neither. At the risk of sounding overly philosophical, it just is. It is an event. It happens to most of us and to some a lot more than to others. Many pay the idea of celebrating failure lip service. They only celebrate failure if/when it leads to eventual success. That’s when you are lauded and celebrated for having persisted.

Me? I take a different view. I think an event can only be termed as a failure if you didn’t grow through the experience. Yes, Nikki’s start-up may have failed but I would term her experience a success – she’s grown through it, learnt a heck of a lot more about herself than many would over a lifetime, and has set herself up for a lot of happiness in the years to come. Joy wouldn’t feel good if it wasn’t for pain after all and it takes a few hard experience to really understand how good a life we lead. It also takes one to know one and I’m sure she’ll be a source of great encouragement and support to entrepreneurs all over the world.

Nikki, thanks for your heartfelt post. It matters. It made me think. And, as you might tell from this slightly scattered collection of thoughts, I’m still thinking. This blog has been built on the belief that you don’t fail, you only learn. And, in that spirit, you’ve made a big difference sharing your story for us all to learn from. And that’s success in my book.

It matters!

The time and effort you put in to make the world a better place? The time you spend volunteering, being positive, giving back, creating something that others can benefit from, inspiring others, and just being of help? We know you had to fight hard to vanquish the resistance’s claims that it doesn’t matter and that it isn’t work worth doing. It is the best of you.

We need more of the best of you.

And, it matters.

Don’t let anyone tell you otherwise.