My Experience Rule 5: Invest in Others

Rule Five: Invest in Others

While they call it “Invest in Others”, this really feels like philanthropy. In their book, Happy Money, Elizabeth and Michael provide a lot of compelling arguments that some of the best return on happiness comes from donating to others. However, if your donations have these attributes, the donation delivers you the most happiness.

  1. Make it a choice
  2. Make a connection
  3. Make an impact

When you feel like it’s a choice, you feel empowered. As a friend of mine once joked, “Barney the Dinosaur is a socialist”

“How can you say that?” I asked

“Because if you want to share its philanthropy. If you have to give, it’s socialism.”

The point being, that a key ingredient in effectively investing in others is our own feelings of self-control and self-efficacy.

After you get to choose where your hard-earned dollars go, the next step in the ladder toward happy philanthropy is to make a connection with the people you are helping. Finally, what will help cement the good will is the feeling that you made a difference. Successful, happy philanthropists want to know that made an impact.

And as I look back, I would say one of the very best things I ever did that combined nearly all of these 5 ideas was my trip to Guatemala with my daughter Rebecca. We went with a Christian Faith based Non-Profit group called Outreach for World Hope.

In her book Tears Water the Seeds of Hope, Kim Tews writes about how she created an amazing ministry in Central America that helps the poorest of the poor.

I was intruded to Kim and her husband Randy through my friend Chris. It started out innocently enough. I went to a National Honor Society meeting at our local high school. Normally when I go to these things, my goal is to not fall asleep and embarrass my wife. I never expected to walk away with a life changing idea.

But that’s what happened. The incoming president of the class of 2016 NHS, gave a speech about Philanthropy and she said something like this (I paraphrase), “We have to trust that work we are doing actually helps someone.”

Looking back, she was directly commenting on the 3 core items revealed by Happy Money. Most of the charity events the kids worked on were not of their choosing, they were handed work. Secondly, they never met anyone they helped. Finally, there was no method of feedback. They could never see the impact of their efforts.

I left the room thinking about how my own charitable activities, both personally and through GameTruck had been sufficiently sanitized to the point that, while I have more control over who I donate to or support, I never make a connection and I couldn’t think of any meaningful impact.

I don’t feel like I wasted my time, but I started to feel extremely disconnected. Like all this Philanthropy had become extremely sterile. I shared these feelings with Chris at my weekly bible study group and he said, “Hey you want to go to Guatemala?”

My initial reaction was, “Lord no!” But before those words came out of my mouth, I realized that was exactly what I needed to do. I needed to get outside my comfort zone. And so, that’s what I did. And I can tell you that going to Guatemala was one of the most rewarding experiences of my life, not only for me, but also for my daughter.

The trip itself is another story for another day, but looking back it touched on 4 of the 5 rules and hit all three of the rule five attributes.

  1. We bought an experience, not a thing.
  2. It was definitely a treat, something we looked forward to.
  3. We paid first, and consumed later
  4. We invested in others
    • We got to choose what we worked on
    • We made connections with the people we helped
    • We got to see the work help the people immediately

Looking back, I would say that single trip maximized nearly every attribute of the Happy Money principles and it was one that changed multiple lives including my own.

My Experience with Rule 4: Pay First, Consume Later

Rule Four: Pay First, Consume Later

I would say that the closest I have come to using this philosophy has been in 2 areas.

  1. Taking a cruise.
  2. Language learning.
  3. Our Mission Trip

With the cruise, we paid for everything, the tickets, the plane flight the whole thing four our family in advance. I didn’t realize it at the time but this was an example of Pay First, consumer later. Once we were on the cruise ship we felt like there was nothing else to spend money on. Of course, there was, but we enjoyed the food and entertainment to the max.

Looking back on it, the only thing that was off for me was the one time we went to the steak house for dinner. The ship had an upscale steak house and while it was nice, I don’t think we enjoyed it nearly as much as we did the free pizza on the back of the ship at midnight.

Along those lines, we also paid for all the excursions in advance, which made for a lot more fun because I wasn’t pulling my wallet out every hour (or every ten minutes) which has happened at some theme parks in the US.

For language learning, I knew I needed to get fluent and fast in Spanish. As a result, I bought 10 lessons and paid up front. I was able to take four lessons before I went to central America and it made a HUGE difference in my ability to communicate.

Now, I look at the remaining six lessons as fun self-improvement time and I look forward to them.

I realize in retrospect our mission trip was a lot like the cruise. We paid all the costs up front – tickets, hotel, contribution to the program. That left us free to enjoy our time and focus on our mission (more about that later).

As I reflect on 2016, and look forward into 2017 I am going to try and do more Pay First, Consumer Later strategies.

 

My Experience With Rule 3: Buy Time

Rule Three: Buy Time

Buying time. It could be argued that rule one covers buying time, however I have about a month under my belt of learning about the power of delegation.

A really excellent service I have been trying out for the last month is http://getleverage.com (formally less doing). I have to say that this service has been fantastic for me. The whole idea behind get leverage is to offload time consuming tasks to someone else. In essence, you are buying time.

Here’s a few examples:

  • Find a restaurant in Seattle that can seat 40 people for our conference.
  • Find transportation for 40 people to and from hotel for the dinner.
  • Make travel arrangements.
  • Convert a screen shot of a table (why do people do this?) into a spreadsheet so we can actually work with it.
  • Update a website
  • Create a webpage
  • Find a driver to haul a trailer from one state to another.

There are more, but each of these tasks took time. I could have done each and every one of these myself, but by delegating these tasks I freed up nearly 20 hours in a month.

Not only that, I learned to:

  • be clear about the outcome I wanted before I started a task
  • gather all the necessary resources into one place so that the person I was paying to do the work could be more productive
  • set the context for a task so the person doing the work could improvise correctly if necessary.

So far I have been really happy with the service and it has expanded the capability of our organization without the need to add more staff, but more importantly it has freed me and some of my team members up – giving us to more high value tasks.

I am sure there are other ways to buy time, but for me this has been one of the most effective.

 

My Experience with Rule 2: Make It a Treat

Rule Two: Make It a Treat

I have not had as much success with this rule. I realize the idea behind it, but one of the challenges of making something a treat is that it then falls outside your normal routine. for me this translates into needing to exert more effort in order to attain the thing I am after.

In his excellent book, the Power of Habit, Charles Duhigg relates how we can use rewards to build habits we want to have. From that perspective, I combined the Make It a Treat, to help build a habit that keeps me (mostly) on target with eating healthy.

I found I do better when I have a food plan for the day. If I don’t, then I tend to eat whatever and at the end of the day I’m angry and frustrated with myself. But expecting my brain to have all the resources it needs to turn down brownies in the snack room when I am feeling depleted usually does not turn out the way I want.

So, having a plan, and assembling, snacks ahead of time, has given me more control over my diet and consequently my health.

The result of this I really felt on my two most recent trips abroad. I am over 50 years old (51 now actually) and despite the demands of taking red-eye flights, long layovers to take long flights to central, and later south America, I was able to keep my energy high, my focus intact and on two different occasions, I worked long days without fatigue.

Even I was stunned at my sustained energy level. I am convinced that all of this was the accumulated healthy and wellness from my habit of using “treats” to build better eating habits. A treat could be as simple as an Isagenix eShot in an unsweetened Green Tea, or some healthy low carb snacks my wife put together.

Green Ice Tea

I am not sure why, but treats to me always translates into food. I supposed you could use it for anything like a bottle of ink, or a video game, or maybe a new book, but for me I always associated this habit with food.

And I would say that when you limit your access to a something, it does tend to increase its perceived value and makes it easier to enjoy.

If you combine this idea with the habits found in Joy on Demand: The Art of Discovery the Happiness Within by Chade-Meng Tan, you can build up a pretty potent habit for increasing your day to day happiness with some simple techniques.

 

My Experience with Rule 1: Buy Experiences Not Things

Rule One: Buy Experiences Not Things

Before I even heard of the book, my family and I put this into practice, not once but twice. First in 2013, instead of having another present laden Christmas, we took the money and bought tickets to Australia. Ryan, was invited to play in the Good Will Games, and the rest of us were able to go along.

It was one of the best Christmas ever. Now did we give up gifts entirely? No. Stacy, with her wonderful wisdom, bought small gifts for each of us. But it was the total experience, and the novelty of Australian Chocolate and treats that none of us will ever forget. I still remember the “cool” water bottle I got that Christmas morning in Adelaide.

Two years later, we did it again by taking a Cruise over Christmas and New Years to the Western Caribbean. The results were similar. I can tell you that I hardly remember any gift I got in 2015, but I still wear the watch I got on the cruise ship with fondness, and my memories of the selfie the three kids took on Roatan, Honduras is still the lock screen on my phone. It was one of the happiest memories of our lives.

That was money well spent.

Of all the rules, I would say this is one of the ones that I have never regretted.

Note: There is a corollary to this rule I have been playing with. Derek Sivers, the author of Anything You Want, and a frequent hero of Tim Ferris, said in the book Tools of Titans that he would put the following billboard outside every Mall in the world.

It Won’t Make You Happy.

I took that to mean exactly what Rule One is about. Things won’t make you happy.   Lately I have been thinking about that more and more, as I troll Amazon looking for things I don’t have.  “It won’t make you happy”, keeps running through my head.

I have found it a powerful tool to focus my attention on the expenditures that have a better chance of making me happy… like buying experiences I will never forget.

My Experience with Happy Money – Part 1

Happy Money

I recently read the book Happy Money by Elizabeth Dunn and Michael Norton. The book is clever and as the authors like to point out, there are 17,000 books on Amazon to tell you how to get more money. They wanted to write a book to tell you how to get more happiness from the money you have.

Their book delivers 5 guiding principles.

  1. Buy experiences not things: We humans acclimate fast and the novelty of new wears offquickly, experiences however can create positive memories that last a life time.
  2. Make purchases a treat: Along the line of 1, about ability to adjust fast can make something that was once special, ordinary and boring. Making it a treat helps sustain the emotional payoff.
  3. Buy Time: We often lose sight of the fact that we don’t have time to enjoy the things we buy. Buying time can allow us to enjoy items 1 and 2 more.
  4. Pay First, Consume Later: Turns out, paying first builds anticipation, and there’s no dread after consumption. So, you get more “happy” for the same money.
  5. Invest in Others: Turns out, spending money on others delivers some of the biggest happiness returns science has measured.

In my personal experience, I can vouch that I have tested all 5 of these principles to some degree and I have found at least some validity in them.

Over the next few weeks, I will share personal experiences for each of the rules and my findings. Starting next week with, Rule One, buy experiences not things.

 

Novis Weekly Read: The Soul of Money by Lynne Twist

What I am “Reading” This Week

This week I have been listening to the excellent book “The Soul of Money,” By Lynne Twist. A friend of mine recently circulated an article that appeared on business insider. where the author has yet to meet a “rich person”. Everyone he met, no matter how wealthy in appearance, always had a tale of frustration and woe. No one it seems, feels rich.

Mrs. Twists book goes right at that concept and it dove tails nicely with Daring Greatly. It turns out in a culture driven by a Scarcity Mentality, few Dare to live greatly because there is never “enough”. I love books that challenge the status quo and make us reconsider the unquestioned answer.

Peter Thiel of PayPal fame and author of Zero to One, is noted for asking, “What one truth do you believe that very few other people believe?” This book is one of those truth. I first learned about it from Verne Harnish but it keeps popping up over and over again.

It’s worth a read.

My Pen This Week

These week I was fond of my Delta Skeleton Stub. This pen is a piston filler with an impossibly smooth nib. It is bold and writes great with Iroshizuku Ku-jaku Ink. You want to be careful because it does lay down a LOT of ink, but that’s partly what makes it fun. They pen is hefty with a steel exoskeleton over the signature orange celluloid. I picked up in New York at the Fountain Pen Hospital and it has been one of my favorites ever since.

The piston filler has a novel ratchet mechanism which keeps you from over tightening the screw. All in all it is a great pen, but not a cheap one. It took me a long time to pony up for Delta and my only regret is that I did not do it sooner.

5 Lessons From Baseball for Business Owners

On my 50th birthday, I thought about calling it 50 Baseball Lessons for Business Owners, but let’s just stick with 5 shall we?

5  Lessons From Baseball For Business Owners

I love baseball. You may have heard the cliché, “Baseball is life.”  Well, I believe that Baseball is Business.  And, according to Dr. Art Markman in his book Smart Thinking, analogies are powerful tools we can use to reveal new insights into old problems.  With that in mind, I want to share my thoughts on Baseball and Business.  Your mileage may vary.

  1. Baseball Has No Clock

Despite the addition of Pace Of Play Rules to the sport, professional baseball does not have a clock.   A baseball game ends when all twenty-seven outs have been recorded and there is a clear winner. No winner? Play another six outs.  No clear winner?  Keep going until someone wins. No matter how long it takes.

Baseball players don’t go home until the work is done!

Running a business is the same.  Sure we have deadlines, but most of the time these are arbitrary and self-imposed.  The real deadline is more like baseball.  You can not quit until the work is done (and sometimes not even then). Erroneously, many people focus on time-management strategies, but in reality, the “Get-Things-Done” strategies have the greatest impact.  It is easy to be “busy,” but unless you finish, the game never ends.

Business, like baseball, doesn’t end until the work is done.

  1. You Strike Out A Lot

Man, I hate to fail because failing sucks.  More than that failure is shameful!  Remember how your parents reacted when you flunked a test or failed to turn in a homework assignment?  (If you’ve never had that pleasant experience please switch to another blog – I don’t know you.)  I remember and I never wanted to fail again.  Of course, that didn’t stop me from screwing up, but holy cow, for a long time I avoided failure like the plague, which ironically only seemed to make it harder to succeed.

Then I observed how baseball players step up in front of thousands of fans… every night… and strike out.  Over, and over again.   I am quite sure they don’t want to fail, but it happens and they never stop trying!  

The best hitters fail 7 out of 10 times.  I’m in awe of the kind of internal fortitude that it take to face that kind of humiliation and keep coming back for more.  With this high-level of failure, it is difficult to imagine that these guys are the best, but they are and I believe it’s because they never stop trying.

It turns out business is more like baseball than school.  Maybe that’s why no one calls school “the real world” but people call baseball “life.”  Zig Ziggler famously said most sales happen after the 7th “no.”  Think about that.  Seven failures in a row before you get to success.  Sound familiar?

In Business, like in  Baseball, you will strike out a lot, but the success comes to those who keep going until they get a hit.

  1. Winners Face the Toughest Hitters First

Competitive baseball teams put their best hitters at the front of the order.  Pitchers don’t get to ease their way into the game, they start off facing their biggest challenges.  To be a winning pitcher, they must figure out how to get those guys out.

In my business, I have learned to tackle the hard problems first.  Avoiding them, is a lot like pitching around tough batters.  And the results are usually the same.  Pitchers who walk a lot of batters don’t stay in the game very long.  Entrepreneurs who don’t face their toughest problems early often wind up working for someone else.

If you want to stay in the game, face your most difficult problems first.

  1. Your Last Hitter May Be Your MVP

One thing I have observed about playoff baseball is how often Most Valuable Players come from the bottom of the lineup.  On my son’s team, we won our first little league championship when the last batter in our lineup hit a game winning homerun.  

Why does this happen?  Because when the competition is fierce, the strengths balance each other.  This means small changes loom large and it is your weaknesses, not your strengths, that make the difference.  This is how great teams distinguish themselves: by building upon their strengths, but also working on their weaknesses.

Too many teams do one or the other.  Either they ride their best players, putting everything on them.  Or they try to shore up their weaknesses while losing sight of their strengths.  To build a winning team you have to do both.  

In Baseball and business, good teams have great players. Exceptional teams improve all of their players. Build on strengths; work on weaknesses.

  1. Success Is A Chain Made Of Execution.

There are tons of sports analogies with business, but in my experience, no competitor ever comes crashing through my front door to tackle a developer.  No one blankets my sales team so they can’t receive a lead.  In short, no one is allowed to interfere directly with my team.  My team’s success depends almost wholly upon their ability to execute, effectively and efficiently,  in a way that allows the next team member to do their job when it is their turn.

That’s the number one reason I like baseball.  While it is extremely competitive, opposing teams are not allowed to interfere with each other.  If they do, it’s a penalty (yes there are a few exceptions).  Not only can opposing players not interfere with each other, players on the same team really can’t even help each other either.  There are no double teams in baseball, no pick-and-rolls.

Success in baseball comes from talented, well-trained players doing their job then passing the ball to the next player who does the same.  A successful play is a chain of well executed individual efforts.

What a beautiful metaphor for business.   Do your job.  Do it well.  Do it to the best of your ability.  And then, most importantly, finish so the next guy can do the same.  Set your teammates up for success.  We call this execution.

Teams are only successful if each person does his job.  Success is a chain built of execution.

 

I love baseball for a myriad of reasons and I hope my simple comparisons give you a new way of looking at your business.  

Do you have a different way of mapping a sport to your company? Tell me about it in the comments. I’d love to hear from you.

5 Hard Lessons For Employees-Turned-Entrepreneurs

 

img cred: Critter for opensource.com

5 Hard Lessons For Employees-Turned-Entrepreneurs

The popularity of entrepreneurial books, podcasts, and television shows like “Shark Tank,” give the impression that everyone is starting a business. The truth is that while many people are, not everyone who does is successful.  If you are making the jump from corporate America into full-time entrepreneurship, you are likely to find that there are some hard lessons that you must learn.

The following five lessons are some of the most difficult for many business owners to master and are surely at the forefront of the reasons why employees-turned-entrepreneurs are unsuccessful in their new ventures.

Lesson One: Become a Real Negotiator

In the book Getting to Yes by Roger Fisher, William L. Ury,  and Bruce Patton, the authors clearly explain how a “hard negotiation” style will destroy a “soft negotiation” style every time.

If you have spent any time in corporate America, the chances are that you learned how to get along well with others. You use phrases and words like, “Win-Win” and “Partnership” when you think of negotiation. You want to reach a mutually beneficial agreement and you yield quickly to the demands of others to keep the peace. You are a “soft negotiator”. While this is valuable in a corporate context, most likely you were shielded from the myriad of aggressive negotiation tactics, “hard negotiations,” used externally, and in some cases internally, by your company.

The reality is that when you are first starting out as a business owner, you are playing a game whose rules are vaguely familiar. Furthermore, you are probably unaware that the game even exists in first place. Your opponents are well-equipped, and they are looking for fresh meat.  My intention is not to frighten you, but not everyone in the free-for-all that is the modern global economy is thinking about creating “win-win” situation. “Hard negotiators” are not as easily swayed and will stop at almost nothing to get what they want.

The most important (and possibly expensive) lessons you can learn are:

  • How to effectively negotiate when you no longer have the resources of a large corporation to give you leverage by understanding the various negotiation tactics.  
  • If you think you are a good negotiator and are not an attorney, you need help.

Lesson Two: Make Your Accounting Useful For YOU

I admit upfront that I hate accounting because it makes me feel unintelligent. Many of the small business owners to whom I speak say the same. There are many reasons for this but here’s what you need to know:

  • Develop a system for tracking your real cash (not just profits) that you can manage daily. Learn enough so that you can design your accounting system to be useful to you in the way that you will use it.
  • Tracking your cash must become a habit. You will be shocked at the number of people who will confidently do their job with absolutely zero understanding of your financials even when they have access to them. They are counting on you to know what is going on.

You cannot delegate having a firm grasp on your financials to anyone else. If you do, then you will not be running a business, you will be working for someone else wondering where all the money went.

Lesson Three: Create a Culture

What would your front yard look like if you never paid attention to it, never watered it, never mowed it, in short never cared about it? Can you imagine that? Can you picture it?

Now know this: Your company culture will look worse if you treat it the same way.

Any system composed of living organisms will grow and evolve, constantly. Moreover, it will do so with or without your permission. That is what they do.

Your business is a living organism. It is a system made up of people who are very different. The behaviors of those people will define its culture. Now you might get lucky, and that group of people may produce an incredible culture without much effort.  However, and this is common, they could produce a cancerous growth that kills their host. There are two lessons here:

  • Recognize that it is your responsibility to create the culture you want. When you become an employee of a company, chances are the owners or employees previously established the office culture. However, now you have to create it yourself.
  • Learn the skills necessary to establish a culture on purpose.What happens if you do not? Remember the image of your untended front yard? You will get a culture, but it will happen by default. In my experience, very few business owners are happy with the culture they get by default.

There are tools and techniques to build the culture you want. Look for them. Learn them. Use them. It is hard, but it can be the difference between feeling like you cannot wait to get to the office every morning and dreading what awaits you when you get in. Learn how to cultivate the culture you want.

Lesson Four: Master Your Marketing

Unless you are starting a marketing company, chances are you have no idea what marketing entails. Moreover, you are probably unfamiliar with what the word means. You might think you know, but you probably don’t. Why? Because the word is so overused and abused, it is hard to understand what marketing is, why it is necessary, and what to do to create an effective marketing strategy. Further, so many people want to sell you “marketing” that the real purpose and nature of it gets lost in the weeds. For example, we have deeply fixed terms like “sales and marketing” as if sales can precede marketing.

Here is the hard lesson: Marketing is lead generation.

That is it!

Those who will profit from confusing you (and many people do),  will disagree with me. I do not care!

A marketing plan is a plan to generate leads on a budget, in a given time frame.

If you do not generate leads, you will not get sales. It is that simple.

So no matter how fun it is to buy beautiful pictures or sexy ads, the hard lesson is to stay focused on what will grow your business. Leads. Leads. Leads.

Sounds too simple? OK, go ahead and try it.

Here’s a bonus lesson: Simple does not always mean easy. I had personally witnessed people waste tens-of-thousands of dollars before they learned this lesson.

Lesson Five: Making Money is Not The Same As Earning Money

This last one is the craziest lesson of all. Most employees have years of conditioning which reinforce the entrenched belief that it takes personal effort and application of skill to earn money.

It is not an unreasonable perspective for someone collecting a paycheck, but it can be a serious handicap for an entrepreneur. You will work hard. By the measure of income, the most successful business owners I know work very long hours. However, there is an enormous difference between owners who believe they are earning money and those who are working to manage systems that make money. Here’s the difference:

  • If you think you are making money, you  will focus on your business as a way to collect a paycheck. You are working x-amount of hours to earn x-amount of dollars.
  • If you are managing a system that makes money, you focus on creating a system of generating cash-flow. You become the leader those that operate the systems that run your business.

To explain further, working for a paycheck will hold you back because it constricts you in two dimensions. Focusing on the all mighty paycheck will drain precious cash that your business needs to fuel its growth. Of course, you should get paid, but you will have to determine what is the BEST use of that cash- saving or reinvesting in your business. Moreover, most detrimental to your company’s growth is that you cannot imagine working hard enough to be worth what people are willing to pay.

It sounds crazy, I know, but the salary/earning mindset can interfere with your business growth because it leads you to sell your cost instead of your value.

The truth is that most salaried employees people do not personally experience the kind of exponential income growth that a business can produce when it is marketing, sales, and operating systems are well-tuned and working together to reach a concrete goal. Typically most people can only grow their income incrementally over the course of many years. A business, on the other hand, can leap forward and double or even triple if the conditions are right. Most former employees do not have the experience to recognize that kind of jump is even possible even when they see it first hand!

The hard lesson here:  

  • Understand that your job is not to earn a paycheck
  • Know how your effort improves a scalable business model which makes money

Conclusion

Most of these lessons are not complex, but they do fly in the face of our working experience.

  • We learn to play nicely, which gives us a false sense of our negotiation prowess.
  • We rely on accounting departments, so we never learn about setting up effective financial systems.
  • We join companies whose cultures are already in place, so  we do not learn how to create a beneficial one of our own.
  • Our personal experience with the biggest brands hides the exact function of marketing, so we do not learn its real purpose.
  • The most important skill, the one that drove our career – earning a paycheck – can ironically hold us back. The career that made it possible for us to start our company can make it difficult for us to imagine systems that can generate income out of proportion to our personal effort.

Business owners can master all of these lessons of course, but they require a new perspective and a new context. To build a business, you have to transcend being an employee. You have to become something more. You need to become an Entrepreneur.

The ABC’s And Some Times D’s of Success

When I was in college my Dad told me this story. Now just because I site my source does not mean this story is not apocryphal. Apocryphal in this context means anonymous, legendary, and slightly mythical. So does that mean it is not true? Like all good stories this one bears enough truth to be worth retelling.

The real question is this, “Is the story true for you?”

Only you will know the answer to that.

abcd_of_success

My father was the first child in his family, possibly his gene pool even, to get a college degree. Growing up in Detroit in the 60’s, my father attended the one school which would not only admit him, but pay for his tuition to become an engineer; General Motor’s Institute in Flint Michigan.

Now named Kettering University, GMI was founded in 1919 as the School of Automobile Trades. It was renamed to GMI in 1926. General Motors allegedly hired 80 to 90 percent of GMI’s graduates for decades. As my father relayed the story, it was this prolonged hiring from one institution that inspired someone at GMI to ask the question, “Was there any correlation between grades and performance on the job?”

In other words, did success at school predict career success? In the book Emotional Intelligence, Daniel Goleman conveyed that “success in education only predicted success in education”. There was very little correlation between grades and life. In his book Outliers, Malcolm Gladwell discussed a similar study done by the University of Michigan Business School. The Michigan study revealed that selection criteria (high school results) did not predict B-School graduate life success. Most people took away from Outliers that you need 10,000 hours to master any skill, but I took away that the opportunity to achieve 10,000 hours of mastery is more important than the skill or the time spent getting it. If we use grades to determine who gets an opportunity to succeed, we might be missing some of our most valuable and talented people. What’s more, if you are disqualifying yourself from trying something hard because you don’t have the grades or the qualifications, you might doing yourself an enormous disservice.

Predicting human future performance is always tricky. The GMI situation however study was unique because so many people from the same school went into the same company and stayed there for so long. What’s more, they performed mostly the same job. That is an unusually high number of variables to remain constant for such a long period of time.

GMI also had one other unusual distinction, at least as far as modern day college graduates are concerned. GMI awarded degrees not only to A, B, and C students. It was also possible to receive a degree if you earned a D. That’s right, they gave degrees to people who were below average. Apparently, below average was still not failing, and therefore worthy of a degree.

It is hard to even conceive of such a thing today, and technically speaking they did not use letter grades. My father translated the old GMI point system into letter grades to make it more understandable for my sister and I. However, they definitely had four clear demarkations which could result in your earning a degree; A-Excellent, B- Above Average, C-Average, and D-Below Average.

So what did the study discover? Did grades accurately predict career success? The short answer was yes, but not the way most people would expect. Convention says the A students would be top executives, the B students would end up in middle management, and the C students would be in the rank and file, and the D’s, well surely they must be sweeping the floor or no longer employed right?

The actual results were somewhat surprising. The top performing group (by career success) did not come from the A students. The A’s were good employees, but did not prove to be exceptional in the work place. The C students proved average was average. No the top leaders came from the B’s and the D’s. What? How could that be? It seemed the A students excelled at applying proven solutions but could not seem to develop them while the B students tended to be the most socially active and therefore possessed valuable skills that were not easily captured by grades.

But what of those D’s? How could they be successful?

The answer comes from two ungraded traits they demonstrated. First, they were so creative they barely fit the constraints of a rigidly formed education. They were non-conformists. They chaffed at the rigors of school. But they did not flunk out thanks to trait number two. They were so stubborn they wouldn’t quit. Imagine someone intelligent, creative, and relentless. What kind of person barely gets by but refuses to quit? That kind of stubborn determination in the face of incredible odds proved to be exactly the ingredients GM needed to solve the kind of problems no one had ever solved before.

When you had a problem with no answer in the back of the book, you needed a problem solver who was creative, and unwilling to quit until they worked it out. Enter your ’D’s.

But is it true?

I never tried to find the study or any evidence of it, but in my own experience, the story rang true. Some of the most brilliant and successful people I have had the privilege of working with in the video game industry fit this template. Many had a GED, but never graduated from college. They are creative, intelligent, unconventional, and easily bored. But more than anything they were tenacious. They created technologies other people could barely comprehend. Perhaps most important of all they were not too proud to learn from anyone or anything. They were driven by their vision for what must be done, tirelessley committed to making it happen.

My father once told me that he got a C in high school, a B in college, and an A in life.

I would add, “the grade you give yourself is far more important than any grade handed to you by someone else”.