The Power of Simplicity
We live in a complex world. Governments and politics are opaque to many of us. The stock market is, for most of us, very complicated. Business and its interrelationships with other businesses can be difficult to understand. This coupled with the observation that we humans seem to have a predisposition to make things complicated.
In 1896, Alfredo Pareto an Italian Economist noted that 80% of the land was owned by 20% of the people. The observation was later validated by others who named it the Pareto Principle, which then evolved into the 80/20 rule. For example, 80% of sales come from 20% of customers, and 80% of sales are generated by 20% of salespeople. The point of the principle is that the few give the many.
Many people would like to understand how to generate success in life. We see phenomenally successful people, like actors, sportsmen/women, business people, entertainers, and the like and want to know we too can create such success. The answer lies in the advice that Warren Buffet, the greatest investor of all time, shares. He calls it the 3-step, 5/25 strategy.
Step 1. Write your top 25 goals.
Step 2. Circle your top 5 goals from the list of 25.
Step 3. Get to work on your top 5 goals and avoid at all costs the other 20.
That’s it. It’s simple. That’s what wildly successful people do. They are focused.
In business and in life, we can leverage the Power of Simplicity to ensure that we accomplish what we want. I once heard someone share the following. “If you want to be happier, identify the 2-3 things that make you happy, and do them more often.”
In business we complicate things. We need to look no further than job descriptions or ads. They are complex, over thought, and likely no one would be able to deliver on them. They are complicated and frequently not a match for what’s needed. I encourage my clients to look at job descriptions and ads from the perspective of the end-of-year annual review.
When we review employees' work at the end of the year, we typically evaluate them on 3-4 things. We look at what they are accountable for delivering. If this is how we evaluate them, then why not simplify the job description or ads to reflect what they are going to be evaluated on?
I USE AN APPROACH WITH MY CLIENTS I CALL 3X4’S.
Define the job in three bullet points of four words or less. (For executives, we expand it to 4x4’s.)
While the idea of 3x4’s or 4x4’s sounds simple, I have found that clients struggle to get to what’s most important in an easy to understand and relevant way. What you ultimately create are 3 or 4 key accountabilities that we want an individual to deliver on. This is what we hire people to do.
Similarly, organizations struggle with business strategy. Again, we frequently overcomplicate things having too many or too complex strategies. Just like with job descriptions, in business, we should use the 80/20 principle as well as Buffet’s 3-step, 5/25 strategy.
For many, businesses are complicated. I think it can and should be simple. At its simplest level, all businesses comprise three things, people, strategy, and execution.
The way to optimize our chances for success is to ensure that we hire the right people and set them up for success in the role by clearly defining what they are accountable for. Then we can create simple short-term strategies to propel us on the path to the future we envision for our companies. Lastly, is execution — the most critical piece of the three. It’s better to have a poor strategy that you execute well than a great strategy that you can’t execute. Execution is, in my opinion, about the actions we need to take to enable us to reach our goals. It’s the leader’s job to measure and manage their teams to ensure that we are taking the right actions to deliver on our strategy.
Business can be hard, but in my opinion, if we simplify things, we increase our chances to achieve our vision for the future.