April 14, 2020

Planning and Knowledge

Morgen Witzel has me obsessed with his book A History of Management Thought. I can’t put it down. Highlights, notes, and questions mark every page. I haven’t yet reached the halfway point and I count my highlights and notes at 263. My all-time high is 274…for an entire book.

The book already has me asking two big questions:

  1. Is planning over-valued?
  2. Is breadth of knowledge under-valued?

1. Is planning over-valued?

Machiavelli says, “Yes.” I knew that going in. I knew that The Prince and the general conception of him is that he favors ‘political opportunism’. A more surprising insight provided by Witzel’s history is that Carl von Clausewitz, author of On War and successful Prussian General, also doubted the value of planning. A disciple of his, Prussian field-marshal Helmuth von Moltke commented, ‘no plan survives contact with the enemy.’ (We know Mike Tyson agreed).

I know from studying Scrum, Lean Startup, and Agile methodologies, as well as my experience rapidly sharing customer feedback in the build of Reschedge, that you can’t perfectly plan a product.

While reading, I also remembered Bill Gates’s approach to business being very opportunistic. I believe this is often meant as an insult but the views of von Clausewitz and von Moltke made me reconsider.

Perhaps, I should be more opportunistic.

Personally, lightning struck the night I played Euchre for the first time. It was the first time I met both Erin’s step-mother and her oldest sister. I had no idea how to play and instead of capturing points when I could I hoarded them. I thought it would be to my advantage to have strong cards at the end. My future wife, quickly corrected me since I caused us to lose, “If you have a point, play it.”

That stuck with me. Since that moment, I play all games differently. I seize any opportunity to score immediately. And you know what? I win more.

Does that mean however that I should abandon all planning? That’s a tough pill to swallow even though I tend to plan with a Scrum-based approach of rapid hypothesis testing.

I like to think long-term. I like to think through a series of moves to see myself reaching the end before moving forward. So is there any value in planning? Should I think about planning differently? Another management philosopher introduced me to a new way of thinking about planning.

If I plan, should it be inside-out or outside-in?

Later in Witzel’s history, he discusses French manager Fayol:

He classifies management into five types of activity. The first of these is prévoyance, which earlier translations render as ‘planning’ but which in fact means looking forward or anticipating what is to come.

I had two ideas from those two sentences.

First, my traditional view of planning is inward out and maybe it shouldn’t be. I typically see organizations plan their sales and marketing goals based on conversion metrics within their funnel. We convert Z% opps to won deals, Y% of SQLs to opps, X% of leads to SQLs, that means we need ##### leads.

My takeaway from Fayol is that I should start with or at least factor in the external. How much business activity will there be in my market this year? An estimated #### companies will buy in this category. What is our estimated market share? X%. That means we should win ### of those. From there, activities could be scheduled to try to influence those results.

An inward out plan in a lot of ways is quite egotistical. It says, I (or we) can bend reality to meet my needs. Is that why so many plans fail?

I see companies go through their funnel based goal setting expecting to create more leads than there are buyers in their markets. They may still hit their target but it will be because of especially large customers, an acquisition, or another anomaly. Inevitably, this gives undue credit to funnel forecasting since it resulted in the correct number albeit in a completely different fashion. The forecasting cycle then restarts.

My second takeaway from Fayol is this: anticipate frequent or likely occurrences. Have plans for them. I originally thought just contingency plans for when bad things happen but many good things, aka luck, happen as well. When a good thing or a bad thing happens, do I have a plan in place ready to take advantage of it? The answer right now is no.

I use my business experience above as an example. However, it is just as common for me to plan my weeks this way, “I’ll get all of these tasks done.” Or plan for fitness this way, “I will do these workouts every week for the next month.” That is quite egotistical. It assumes I have complete control over my weeks and what will happen in them – no surprise meetings or requests from a boss, no tough moments with the kids, no days feeling tired, etc.

What if instead, I start my weeks (months, quarters for business) with “What do I think will happen?” Then build contingency plans and capitalizing plans (for when luck strikes) to ensure that if/when those things do happen I can quickly make sure I get the most of what I want out of my weeks (months, quarters).

I don’t know what those plans above will look like or what will happen yet but I want to explore it.

This gives me an idea to experiment with in terms of planning but how do I become a better opportunist? It seems like there may be value for me there.

That’s where I believe breadth of knowledge comes into play.

Is breadth of knowledge under-valued?

Knowledge has always been a source of competitive advantage. The best firms, the best organisations, are built on embedded knowledge that is constantly renewed and refreshed. Take for example the optical equipment maker Carl Zeiss Jena, founded in 1846. The success of this firm was based on its relationship with the University of Jena, which ensured a flow of high-level technical knowledge into the firm. Innovation at Carl Zeiss Jena was something done by everyone, all the time. It was as commonplace as breathing. And Zeiss and Ernst Abbé, the directors, made sure they created an atmosphere where people felt free and were encouraged to innovate. George and Edward Cadbury did the same at their chocolate making works in Britain, as did the chain maker Hans Renold. All these companies thrived on knowledge.

What do you need to know? For the Lunar Men and others in the age of enlightenment, the answer was: everything. No fact was too small, no concept too abstruse as to escape their attention. Go back still further to Copernicus, astronomer, mathematician, philosopher of science, administrator and, on one occasion, military commander. Think of the vast range of interests of Leonardo, or the Arabic writers stressing the importance of adab, general knowledge about everything. The Industrial Revolution was born out of the spirit of inquiry that shaped the Enlightenment. It is almost inconceivable that the Industrial Revolution would have happened without, or at least that it would have taken the form that it did. There were plenty of hedgehogs in the Industrial Revolution, stubborn men who kept on trying to manage new enterprises in old ways, men like Samuel Oldknow; very often they went broke. The foxes, the ones who capitalised on widespread experience and new learning in every form, like Ernst Abbé or Henry Heinz or Matthew Boulton, built businesses that in some cases continued to flourish long after they themselves had turned to dust. They were full of the spirit of inquiry, and they were interested in everything under the sun. What is the lesson for the Internet age? To me, it is this. Somehow, despite the almost overwhelming tide of information that laps around us…

…I must try to learn everything. That is Witzel’s message within a chapter Reflection. However, I believe a more guided answer exists within his own text shortly after. Before I go there though, I must tie this back to opportunism.

How can I be a great Opportunist? At the moment, I believe the answer is to know as much as possible. The more I know and understand, the more opportunities I will be able to both anticipate and seize. That’s it. Thus, the quest for widespread knowledge begins.

Where should I begin? I have read broadly across business and in my career thus far I have explored many roles within the sales, account management, and marketing worlds in tech. I have been in the SMB space, HR software, and healthcare software. On my shelves rest books about producing movies, promoting wrestling matches, writing for Bloomberg, cults, Catholic evangelism, teaching kids to write with their senses, calculus, golf swings, baseball statistics, venture capital, the new and classic sales and marketing books, books on Salesforce, Google Adwords, data analysis, and numerous psychology texts from the Eastern and the Western schools of thought. I have read these from the perspective of business as well as plain curiosity. I have read broadly from the perspective of my craft which is sales, marketing, management, and start-ups. I believe this “general” knowledge serves me well but there are still so many amazing things to learn. And Witzel’s tour through history gave me another insight into the type of knowledge required for successful opportunism.

The eminent economist Alfred Marshall also included a chapter on organisation in his book Industry and Trade, in which he is particularly critical of mass production and repetitive work, claiming that it dulled the mind and made workers less efficient. He praised the craftworking model employed at Carl Zeiss Jena and held it up as an alternative. He also listed the qualities that senior managers should have, including judgement and prudence, technical knowledge, an ability to organise, ‘in which system plays a great part, but “always as a servant, never as a master” ’, the ability to manage people including qualities of trust, tact and sympathy and, finally, diligence and attention to detail

There are few interesting things in that excerpt above but I’m emphasizing the knowledge element. The knowledge most frequently cited as important, although not exclusively, is technical knowledge. That made me ask the question, how do you define technical knowledge.

One radical idea was that workers should spend part of their day doing manual labour and the other part doing ‘intelligence work’, which would allow them to learn and acquire new skills. This would be particularly important for those who came from humble backgrounds and had not been able to avail themselves of higher education.

There it is. Technical knowledge is knowledge that allows someone to acquire a new skill, aka do a new type of work or do existing work better. My early hypothesis is that I should spend about two-thirds of my time learning new skills or deepening existing ones, such as hard skills like building apps in Salesforce or data analysis, where I am strong but could be stronger or soft skills like storytelling. The other third would remain on studying theory, such as Witzel’s book.

Right now, I would say I am about one-third technical and two-thirds theoretical. I believe it is time to flip these after I finish Witzel’s book.

I do not want to throw out theoretical study entirely because without Witzel’s book I would continue to miss some of the incredible insights within it that I believe will outweigh the value of any technical skill acquired, such as wisdom from Fayol above.

My final takeaway on the importance of breadth of knowledge comes from here:

The search for the one best way, then, is the quest for a phantom. No single management theory can be applied in every circumstance. Yet this did not prevent the scientific management community from trying, coming up with ever more elaborate modifications to the core principles as they tried to realise their dream of creating an all-embracing managerial theory for everything.

I spend a lot of time looking for the optimal strategy or the one best way to approach every situation – the best way to plan, the best way to golf, the best way to exercise and the historical context of Witzel’s work gave me the answer.

I often fall in love with someone’s presentation or book who presents the “best” way to sell, market, build a company, launch a product, etc. It is common to present their solutions as universal and omnipotent.

History reveals the truth. They aren’t.

However, that doesn’t mean they should be thrown out. Those solutions are very likely to perform extremely well in certain circumstances. The more of them I can learn, the more solutions I will have in a wide range of situations.

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