The Big Idea: For small volumes of water storage, use ferrocement if you can and plastic if you cannot. For large volumes of water storage, use ponds if you can and ferrocement if you cannot.

Design Principles

1. Lease as much of the water work as possible to nature.
2. Divert water just after evaporation or soil has naturally purified it.
3. Divert water higher than the point of storage and points of use.
4. Conserve pressure in the plumbing.
5. Use adequately, but not excessively, sized pipe.
6. Design to extract benefit from other attributes of your water.
7. Rigorously confine materials that are incompatible with natural cycles. 
8. Intervene as little as possible.
9. Use appropriate technology.
10. Practice moderate and efficient resource use. Context is everything.

Book Notes

• Going from 99% water availability to 99.5% doubles the financial and environmental cost.
• People in industrialized society with running water use about 100 gallons a day. People who have to carry water use about 10 gallons a day.
• Well-designed water storage can actually increase water quality over time. 
• Poorly designed water storage can have many problems: algae growth, bacteria, leaks, sediment buildup, leached carcinogens.
• Try to avoid chlorine to disinfect drinking water as there are carcinogenic byproducts.
• UV light is an ideal disinfectant.
• Nothing beats commercial water quality tests, but you can do dome DIY testing for turbidity, flow, dissolved solids, elevation, general bacteria, and fecal coliform bacteria. 
• 5 ways to store water: none (direct from natural water source), store in soil, store in aquifers, store in ponds, store in tanks. 
• Store in soil: divert water to be soaked up by the soil, where it can be absorbed by plant roots.
• How to increase the amount of water in your aquifer: take out less water, slow down rainwater runoff, detain water in infiltration basins, infiltrate water through creek beds and riverbeds.
• Aquifers recharge naturally through rainwater, but over drafting groundwater can lead to drafting fossil groundwater that has been stored for millions of years. 
• Chemicals and toxins seep into the soil and contaminate groundwater. 
• Storing water in ponds is cheap but open to contamination and exposed to evaporation.
• Three types of man-made ponds: storage ponds, living ponds, runoff harvesting ponds.
• Water tanks are the most common way to store water. 
• To increase water pressure, put the tank on a hill, make a water tower, use a small pressure tank, put a tank on your roof.
• With your tank at roof height, your appliances will barely work. With your tank 10 stories high, your washing machine, water purifier, and water heater will start to work.
• You can install a booster pump just for fire safety. 
• Tubs and kitchen need flow, not high water pressure. 
• Burying water storage tanks can have some advantages but also many disadvantages. 
• If harvesting rainwater, carefully calculate usage (output) and rainfall (input) to size your water tank.
• The classic tank shape (cylindrical, height = diameter) is usually the way to go.
• Ferrocement tanks are a great option for tank construction for a permanent tank.
• HDPE is the preferred plastic for water tank.
• EPDM is the best artificial pond liner.
• Galvanized steel with plastic membrane is a newer but promising technology.
• Food-grade IBC totes can also be used for small water tanks.
• A plastic tank, then encased in masonry for shade and protection is a high-performance, lifetime tank.
• The earth under the tank should be compacted and free of rocks. Drainage should be away from the tank. 
• For small volumes, DIY ferrocement and plastic tanks are the most cost-effective. For large volumes, ponds are the most cost-effective. 
• A pressure tank provides water pressure but requires continuous power. Larger pressure tanks can provide more reserves.
• Be sure to critter-proof the tank from mosquitoes, rodents, and other critters. 
• Keep out the sun to prevent algae. Metal and masonry completely block out light. 
• Paint your tank white to reflect sunlight and keep the tank cooler. 
• Take measures (insulation, south-facing, partial-burying) to keep the tank from freezing in the winter.
• To protect your agricultural land against fires, use fire-safe landscaping, occasional managed fires, robust water systems, fire-proof building materials like metal and concrete

The Big Idea: start businesses in emerging markets where there is much less competition.

• I decided to visit the small Eastern European country of Estonia.
• People who build successful businesses — are driven by circumstances and then led by opportunity. As an entrepreneur , you must be first and foremost an optimist. Being a successful entrepreneur requires three things: vision, leadership, and a team.
• In the beginning, I had no vision. I was taking steps along a path, like wandering around a map. But once I had the vision of what I really wanted to do, everything became easy.
• Faith is contagious.
• Leaders commit and make decisions.
• Until one is committed, there is hesitancy, the chance to draw back, always ineffectiveness. Now is the best time to start.  Don’t procrastinate.
• Your venture doesn’t need to be perfect at the start.
• Try things quickly to see what works and what doesn’t. In the beginning, it’s easy to make mistakes. Early mistakes don’t cost much. Writing and storytelling are powerful tools and key skills for anyone who wants to build a company.
• A plane spends 95 percent of its flight off its charted course.
• Like that pilot, you need to course correct . When you write something down over and over, it gets clarified. Effectively sharing your dream with other people is critical to building the right team.
• Ask for help. It’s the single most important thing you can learn to do in life.
• Not knowing something means you have to start at the beginning. That’s a good thing. Not knowing forces you to ask questions.
• Do ask for advice. Your job is knowing what questions to ask and finding people who know the answers.
• To succeed at anything, you need a team behind you, carrying out your visions and plans and executing.
• Find the right people to support you.
• Reward your team and build camaraderie through work and play.
• Managers implement systems. Good managers get the most out of people and processes. 
• Make a habit of brainstorming.
• One day you will grab the right idea that fits the place you’re at . Ultimately, the key is not the million-dollar idea but the million-dollar execution.
• The execution is the single most important aspect of success in any business. Since execution is the single most important ingredient for success, you better make sure you have the staff to make it happen. 
• Hire people who want to work hard, and reward them. Create a vertical ladder of opportunities for your employees, and train them relentlessly. Pay them well and earn their loyalty.
• Debt by its very nature is cheaper than equity .
• Equity is the dearest thing, and it’s expensive. Don’t give it away. There’s no substitute for tracking your income and expenses personally.
• People will be drawn to you because of your brand.
• Identify the aspect of your business that uniquely identifies you and distinguishes you from the rest of the market.
• To most investors and entrepreneurs outside the continent, Africa is still a virgin market and a dangerous place.
• What is really lacking in Africa is a knowledge base of business skills. As I continue to read more about Africa and meet with people, I see huge similarities between the former Soviet Union countries and the continent of Africa.
• When you are thinking about a business or sector to launch in, look for a market or opportunity where competition is lacking.
• Blue sky means a market or opportunity where you are free to create and explore before everyone else catches up. Hot markets are tempting. They look promising and always seem easy to enter.
• A hot market is both crowded and competitive.
• You will have far more success opening a cool fast food taco stand in Ghana than in London or New York .

The Big Idea: Bill Belichick built a dynasty around on a culture of accountability, continuous improvement, strategic flexibility, and detailed preparation.

Part 1: Culture

• “Do your job” is the New England Patriots mission statement.
• The goal is to improve on a daily basis, work hard, pay attention to the little details, and put the team first.
• Belichick makes sure that the goals set out are achievable.
• Work as hard at it as we can and improve on a daily basis.
• Emphasis on individual performance in a team setting creates a feedback loop that raises the performance of the entire team.
• Without having to worry about the next person, each individual player is able to put their complete focus, dedication, and effort into their own task, which raises the performance of the entire team.
• No one will be willing to follow someone who isn’t competent at their own job.
• There are many types of leadership styles.
• It’s impossible to deal with everyone on an individual basis on a daily basis so Belichick relies upon managers and department heads to keep him informed.
• Having the right people as captains was critical.
• Belichick strives to make sure that the right people are in the right positions.
• Players on the team vote for the team captains ,
• Players buy into the Patriots’ culture due to Belichick addressing any problems quickly.
• Hold people accountable for their actions.
• Belichick views self-evaluation and holding each player accountable as a key part of his coaching strategy.
• The only way for us as a team to get a championship level is to continue to evaluate ourselves, and we have to look at what we’ve done and critically analyze ourselves.
• We can’t hire a consultant to come in and fix our problems.
• The only way for us to get better is to do our own R & D.
• Everyone in the organization must study, learn, and strive to get better.
• Everyone must have an open mindset and be willing to learn and be evaluated.
• Willingness to accept feedback comes with “a certain amount of humility.”
• Understand that mistakes are not fatal. Only by addressing the problem can things improve.

Part 2: Preparation

• Bill Belichick’s father was also a football coach and collected an extensive library of football books.
• Four hundred and thirteen books served as the foundation of Bill Belichick’s football knowledge.
• Belichick insists “Bill Walsh: Finding the Winning Edge: is the greatest piece of football literature regarding a franchise blueprint ever written.
• He is constantly adding to his expertise by finding new information and ideas to win football games.
• He doesn’t care where the ideas come from, or who offers the ideas.
• During staff meetings with his coaches, he first asks his staff for their ideas and suggestions.
• He’s not so full of himself that he won’t listen and tap into any source for an edge.
• Belichick extensive use of analytics is one of his primary competitive strategies.
• The work ethic of Bill Belichick is legendary.
• They know there are nights when Belichick sleeps at Gillette.
• When everyone else is sleeping, or tweeting, or playing Madden, or lounging around, Belichick is studying the game.
• One method that Belichick teaches his players is through the use of daily quizzes.
• No one commands a depth of knowledge quite like Belichick.
• Everyone is expected to study, regardless of their role on the team and how much playing time they are expected to have.
• These quizzes and intense preparation clearly pays off.
• For players who are unable to keep up, Belichick will quickly weed them out.
• When guys get there they either buy in immediately or they are so overwhelmed that they want out.
• With the ball on the one-yard line, the Seattle Seahawks threw a pass play that was intercepted by the Patriots’ Malcolm Butler. Butler, an undrafted free agent, was coached and prepared by Bill Belichick and told to be ready for that play.

Part 3: Performance

• How exactly does Belichick ignore the distractions? He places the entire organization’s focus on the next game.
• Belichick will refuse any interview that has to do with the past because he’s solely focused on the next game.
• Based on his knowledge and constant learning, Belichick is always innovating.
• Despite the heavy criticism for what was essentially the right call on 4th and 2, Belichick did not let the negative outcome affect his decision-making process and would make the same call again.
• If you know the history of the game, you understand that it’s a changing game.
• He isn’t afraid or held prisoner to a certain way of doing things because he knows that change is constant.
• Belichick realized that a faster tempo was becoming a competitive advantage.
• Belichick entire strategy of winning games is based upon exploiting and attacking the weakness of his opponent.
• The core tenets of Bill Belichick’s football program always will remain the same. Versatility is key. Do your job. Hide your weakness and attack their’s.
• Even at 63 years old and with four Super Bowl rings on his nightstand, he’s constantly seeking out new information and his plan of attack is evolving.
• By bringing in smart football players and combining it with his mental training, Belichick is able to create a smart, fast moving team.
• Belichick cross-trains his coaching assistants. Belichick trains his coaching staff to be able to coach both sides of the ball and to be able to move where needed.
• Unlike the many coaches who identify with a particular style or tree, Belichick isn’t locked into a singular ideology.
• Belichick’s greatness has never stemmed from a Big Idea — unless the Big Idea is the relentless application of many Little Ideas.

10 Keys to Success

1. Clearly define the roles of everyone in the organization.
2. Hold people accountable for their roles , and help them when they accept responsibility.
3. The most vocal person isn’t necessary the leader. Be on the lookout for people who are doing their job well in a quiet manner.
4. Improvement takes place on a daily basis.
5. You must take the time to learn about the larger trends in your industry.
6. The goal is to “move the football”, not prove that your way of doing things is the right way.
7. Use any source that can help you gain an advantage.
8. Your strategy must be tailored to your current situation. What worked in one situation will not necessary work in another situation.
9. Focus on the task at hand. Don’t get caught up in any distractions.
10. Control what you can. You can control your effort and your decision – making process. You cannot control results and outcomes.

The Big Idea: Apply lean production principles (Theory of Constraints) to software development. Reduce the work-in-progress to let developers concentrate on only one task at a time.

• Agile development with Kanban means creating a kanban board with tasks posted and a well-defined workflow.
• There are no milestones or sprints and there is minimal overhead.
• Inspired by lean operations, the focus is on a continuous flow of tasks (small batch sizes) throughout the process and on limiting Work-In-Process (WIP) of the bottleneck resource (developers), thereby keeping developers focused on deep-work and maximizing bottleneck throughput.
• 1. Backlog. The first bucket is Backlog. Put unlimited number of tasks here for later. Backlog should be continuously prioritized.
• 2. Breakdown. The second bucket is Breakdown. A product manager moves a task here for analysis. As part of the analysis, the product manager breaks tasks down into smaller tasks here.
• 3. Implement (WIP). The third bucket is Implement. A developer should only be working on one task at a time. Limiting WIP keeps the developer focused on deep-work.
• 4. Validate. The fourth bucket is Validate. A developer moves a task here when it’s complete. The product manager or a tester verifies the task is done.
• Standup meetings should be limited to discussing if anyone’s work is blocked and how to remove the block.
• Another variation is: 1. Pending (all todos, prioritized, ready for breakdown, added by PM) => 2. Ready (ready for implementation, added by PM) => 3. Implement (in-progress, added by engineering) => 4. Done (ready for validation, added by engineering) => 5. Validate (fully validated, added by PM/QA)
• Kanban is a natural fit for continuous deployment environments.
• For theoretical background: read up on Theory of Constraints.

THE BIG IDEA: To build a dream team, find independent thinkers from diverse backgrounds. Then ensure there is just enough tension to generate creative solutions but not so much tension that the team is dysfunctional.

INTRO

• Between 1960 and 1990 , the Soviet national hockey team won nearly every international match it played. It was one of the best sports teams of all time. The same Soviet players underperformed when split up in the NHL. Then Detroit Red Wings coach Scotty Bowman reunited them and they won the Stanley Cup again.
• Research shows, that for some tasks, individuals always outperform teams. But for hard things in work and life, for thing that require creativity and innovation, teams are required. 
• Humans are built for collaboration. There’s science behind this kind of magic that results in magical teamwork.

CH 1: BUDDY COPS AND MOUNTAINTOPS

• The Pinkerton detective agency foiled a plot to assassinate Lincoln. A female detective Kate Karne provided the insight needed to save Lincoln. 
• Adding women to law enforcement improves performance not because they are smarter but because they add a different perspective that forces others to think differently.
• These two parts of our mental tool kit — perspective and heuristics — go hand in hand. Our teammate’s diverse heuristic allowed him to find a better solution .
• If you want innovation, put people with different specialties together. It helps prevent groupthink. 
• Dr. Scott Page, professor of “complex systems” says teams with diverse mental tool kits consistently outperform groups of “the best and the brightest.”
• Cognitive diversity is a key element of teams that exceed the sums of their parts.
• Routine problems don’t require much cognitive diversity, while novel problems benefit from it greatly.
• The more diverse the thinkers in a company’s higher ranks, especially its boardroom, the better a company performs.
• Cities with more immigrants from different parts of the world tend to produce more patents.
• This runs counter to the advice that we tend to get in many of our organizations. “Get more people like that on the bus!” “Let’s double down on our strengths!” “She’s not a culture fit!”

CH 2: TROUBLE IN SHAOLIN

• The merger of Daimler and Chrysler failed because they couldn’t resolve organizational cultural differences.
• Hip-hop was found on battles (rap battles) but Wu-Tang Clan was able to use friction to drive creativity and change music history.
• The Tension Zone is the zone in which there is enough tension to drive innovation but not enough tension to explode. 
• The Wright brothers would resolve arguments by taking turns arguing both sides. This helped decouple arguments from ego.
• Couples that know how to argue last the longest.
• Businesses that rank high in “innovation”—the ones that grow quickly and produce game-changing products and services—tend to encourage the airing and clashing of diverse viewpoints. Not just having differences, but speaking up.
• Companies that don’t innovate tend to make people follow a single, “approved” way of thinking.
• “Having a manager who ignores you is even more detrimental than having a manager who primarily focuses on your weaknesses.”
• When steel rubs against steel, it makes both blades sharper.

CH 3: THE MAGIC CIRCLE

• Argentina has one of the largest populations of Jews in the world. They are well-known for being friendly to Jews. Why? Because the culture encourages everyone to play soccer together. 
• Playing together resolves tension, breaks down barriers, and builds friendships.
• You can learn more about someone in an hour of play than in a year of talk.
• RZA’s rap battles were actually a kind of game that helped dissolve tension and keep driving creativity. 

CH 4: ANGELIC TROUBLEMAKERS

• Picasso’s most productive years as a painter was when he was living with a girlfriend who pushed him out of his comfort zone.
• Cognitive entrenchment is when our brains become inflexible because of certain habits and heuristics. These habits and heuristics that are useful in prior situations are no longer useful. 
• The longer people work together, the more similar their work styles tend to become. The business world often calls them “best practices,” but psychologists correctly call them “groupthink.” If we’re not aware of them, they can stifle innovation and peak performance.
• In Dream Teams, there is often a teammate who can give us a nudge away from groupthink. 
• For developing new insights, it’s often more helpful to study the extremes (outliers) instead of studying the typical (focus groups.) Eg. Dominatrix-for-hire and comfortable shoes. (Tim Ferriss: but ignore those who are an outlier bc of natural ability or a head start.) 
• Dr. Charlan Nemeth of UC Berkeley spent her career studying the science of human influence. Having a naysayer in the group made the rest of the group think harder. Dissenters stimulate the kinds of thought processes that lead to progress.

CH 5: THE BLACK SQUARE

• Sometimes bad ideas can be useful because a bad idea can be very good at pointing us in a new direction.
• Eg. International Dome Symposium in Winooski, the painting The Black Square in Moscow
• Provocation spurs us to action.
• Cognitive expansion happens when we add cognitively diverse people to our team and pay attention to them.
• Dissent helps groups think harder about problems together.
• Many of our most successful modern companies — from Apple to Airbnb — seemed like bad ideas in the beginning.

CH 6: WELCOME TO PIRATELAND

• Shared values are long-term. Shared goals are short-term. 
• Companies who talk about shared values a lot will tend to unify their people quickly and effectively. They have low turnover and relatively stable businesses.
• Values that are too strict and cult-like will tend to stifle dissent, stifle innovation, and stagnate a company.
• Some organizations try to combat stifling values by making “creativity” and “experimentation” values themselves.
• Superordinate goals can get different people to work together. Play and humor can depressurize groups that have too much tension between them.
• Values are not created equal.  Values that help us include different kinds of people and ideas are the kinds of values we want our teams to share.
• Eg. Battle of New Orleans, Rattlers vs Eagles, Built to Last companies.

CH 7: WHEN MALCOLM CHANGED HIS MIND

• People who are open-minded are more likely to consider creative solutions and to innovate.
• What does it take for humans to become open-minded?
• The answer is something psychologists call “intellectual humility.”
• How do you increase open-minded and intellectual humility?
• People who travel become better at  “idea flexibility” or being able to solve problems. They are more open-minded.
• People who actually live in foreign places are even more likely to have high intellectual humility than those who just visit.
• Dr. Galinsky and his colleagues found that graduate students who had lived abroad were more likely to consider out-of-the-box solutions to problems in group projects.
• Neuroscientists find that multilingual people’s brains do look physically different. 
• Eg. Malcolm X’s transformation after his pilgimage to Mecca.
• Eg. Saul the Christian persecutor became Paul the Christian apostle.

CH 8: OXYTOCIN, A LOVE STORY

• Stories have power. Stories can activate oxytocin and empathy, or they can turn on primal fear .
• Stories Asians told others about themselves helped change their position in America. Eg. George Takei and Bruce Lee.
• Stories Hollywood told about gays generated oxytocin + empathy and helped increase acceptance of gays in America.
• Anytime people experience character-driven stories, their brains pump out more oxytocin .
• Positive social encounters release oxytocin — things like hugs , acts of kindness , and emotional stories .
• Every one of the world’s greatest sports dynasties had something surprising in common: their players, and in particular their team captains, had a whole lot of humility.
• This isn’t just humility; it’s intellectual humility. It requires being open to and willing to change when change is hard.
• People who read a book or more per month, the data shows, are significantly more likely to be have intellectual humility. 
• Readers experience more stories, have more empathy, and are more open-minded and have more intellectually humility. 

DREAM TEAMS CHEAT SHEET

• Recruit for “culture add” not “culture fit.”
• Recruit for ability to elevate team, rather than for individual stats.
• Determine team members’ dimensions of internal and external differences that could lead to productive tension and innovation. 
• Make sure everyone on the team knows each other’s “superpowers” or unique abilities.
• Use play and humor to depressurize group tension.
• Give explicit permission (or even rewards) for dissent and productive criticism.
• Have team members get to know each other’s stories.
• Debate instead of brainstorm; when necessary, switch sides of the debate.
• Speak candidly.
• It’s the leader’s job to make sure tension does not get personal.
• Seek diverse sources of information.
• Develop and prioritize curiosity.
• Pay attention to outsiders, weirdos, and far-out ideas.
• When possible, rally teams around superordinate goals.
• Celebrate the uniqueness of the subgroups within the organization.
• Allow subgroup members to have their own values.
• Create unique rituals that the organization can do together to bond.
• Spend significant time immersing yourself in places with cultures different.
• Learn a language.
• Read more books. 

The Big Idea: 1) IQ matters but the best predictor of success is relevant experience plus high emotional intelligence (EQ). 2) Interview 20 individuals before selecting finalists. 3) The preferred strategy for sourcing is to contact people who may know the best candidates.

INTRODUCTION

• Organizations are all about people.
• People are the problem, but they are also the solution.
• Making great people decisions is vitally important to your organization.

CHAPTER ONE – Great People Decisions: A Resource for You

• As an individual, people decisions are also the single most important contributor to your career success. Once you become a manager, you start working through others. 
• As a CEO or chairman, people decisions are both your highest challenge and your biggest opportunity.
• Great management, according to Marcus Buckingham, is to first hire great people, then to assign the right person to the right job.
• The first step in any hiring decision is to think very carefully about what you really need. Outside of work, you should also choose nannies and gardeners just as systematically.
• According to some studies, the best interviewers had predictive validities 10 times better than the worst interviewers. So some people are better at evaluating talent. 
• Larry Bossidy and Ram Charan say “having the right people in the right place is the job no leader should delegate.”
• When hiring, figure out what are the key indicators of a successful hire, assign appropriate weight to those different dimensions. 
• Managers can definitely improving their hiring success. A few basic concepts about people assessment allows managers to become much better at hiring. These are learnable skills .
• Hiring is an area where very few business executives get any formal training at all. You don’t necessarily learn from your experiences, sometimes, because there is a lack of immediate and clear feedback on your people decisions.
• In addition to career success, better hiring decisions will increase your personal happiness. Your work relationships and your professional satisfaction impacts your personal happiness.

CHAPTER TWO – Great People Decisions: A Resource for Your Organization

• According to Built to Last, greatness is not a function of circumstance. Greatness, it turns out, is largely a matter of conscious choice, and discipline. 
• According to Jim Collins, outstanding leadership and the ability to build superior executive teams were the two essential and foundational prerequisites for remarkable, long-lasting corporate excellence.
• First, get the right people on the bus.
• The choice of CEO has an impact on profitability as big as the choice of industry. 
• In The War for Talent, people choices are a key driver of organizational performance.
• According to McKinsey, poor performance was often caused by the wrong people at the top.
• According to Jack Welch, “you can have all the greatest strategies in the world, but they aren’t worth much without the right people.”
• GE has been an outstanding breeding ground for great leaders. GE’ most important product was not light bulbs or transformers, but managerial talent .

CHAPTER THREE – Why Great People Decisions Are So Hard

• The best organizations in the world made all sorts of mistakes when it came to people decisions. 
• 4 Hiring Traps
• 1. The odds are against you. There are only a small number of exceptional performers
• 2. Assessing people for complex positions is inherently difficult. Many knowledge worker jobs are truly unique. Requirements and priorities can rapidly shift. Intangible traits are much harder to evaluate. Many top candidates have no tolerance for any kind of thorough evaluation. 
• 3. Powerful psychological biases impair the quality of the decision-making process. We tend to procrastinate about our people decisions. We tend to overrate a person’s capabilities. Individuals also tent to overrate our own capabilities and skills. Motivation does not equal skill. We tend to overweigh first impressions and make snap judgments based on criteria not related to abilities. We tend to overrate a candidate based on a company reputation from their resume. We tend to overweight an individual’s abilities and underweight the situation they worked in. We tend to seek out confirmatory information and avoid disconfirmatory information. We tend to hire someone based on familiarity. The most important step for avoiding these biases is awareness. 
• 4. Misplaced incentives and conflicts of interest can easily sabotage these decisions. Keep an eye out for candidates who feel like a position is the perfect fit for them based they want (or need) the job. Such a candidate is likely to exaggerate their capabilities and resume. Also keep an eye out for nepotism and cronyism during the hiring process.

CHAPTER FOUR – Knowing When a Change Is Needed

• Human nature inclines us to procrastinate in our people decisions, so few executives have a succession plan.
• Five Discontinuity Scenarios That May Require Change in Leadership
• 1.Launching New Businesses
• When the launch of a new venture calls for a people change, both types of candidates — internal and external — should be properly considered. 
• 2.Doing Mergers and Acquisitions
• 3.Developing and Implementing New Strategies
• When you change strategies, you very often have to change horses. Jim Collins’s Good to Great says “First Who . . . Then What. They first got the right people on the bus, the wrong people off the bus, and the right people in the right seats — and then they figured out where to drive it . ”
• 4.Dealing with Performance Problems
• Fundamental attribution error: sometimes the situation is the cause, not the leader.  Are you experiencing a bumpy ride? Is it your car? Or is it the road?
• 5.Coping with Growth and Success
• Leaders mush manage the present and anticipate the future. 
• Powerful forces that tend to work against change. 1) The universal human impulse to prefer short-term comfort over uncertain, but possibly better, future. 2) Culture in which personal relationships trump the rules. 3) People underreact when things are tranquil and overreact when there is chaos. 
• Jack Welch says candor is very hard to achieve and even runs up against human nature. 
• Howard Stevenson says the most common mistake: you never fire people early enough.
• If you as a boss are “ loyal ” to an incompetent employee, that makes you appear less honest and therefore costs you more than it gains. 
• We tend to escalate our commitments and try to hang on, despite clear signs that it is time to bail. 
• Jim Collins on how “good to great” companies decide who should get off the bus, and how: they apply exacting standards at all times and at all levels. They are rigorous, not ruthless.

CHAPTER FIVE – What to Look For

• What is the best predictor of a person’s success in a job?
• First of all, the ideal candidate doesn’t exist. 
• So you want to understand which strengths are critically important and which weaknesses aren’t fatal.
• Does IQ matter? Yes, but it’s not usually the critical factor. It matters most when you hire someone with no previous experience in the job
• Does experience matter? Yes, experience matters a lot .
• Does personality matter? Personality is too subjective. Personality tests are not particularly valid and any conclusions should be taken with a grain of salt.
• Emotional intelligence, in business where we depend on others, could be more important to personal success than IQ .
• Actual job-related behaviors were the best indicators of potential success.
• Richard Boyatzis published The Competent Manager to describe competencies and job performance.
• First, a distinctive set of competencies is required for every job and for every company.
• Second, the list of typical key competencies for managers and senior executives tends to be short.
• Egon Zehnder identifies four key competencies for successful managers. 
• 1. Successful managers need to have a strong “results orientation” (i.e., be focused on improving the results of the business).
• 2. Successful managers know how to focus, align, and build effective groups.
• 3. Successful managers how know to work with peers and partners they have no direct authority over. 
• 4. Successful manager have a “strategic orientation” that enables them to think Big Picture.
• The candidates who were most likely to be extremely successful combine relevant experience plus high emotional intelligence (EI).
• Lack of EI is very highly correlated with failure.
• What is Emotional Intelligence? a. self – awareness  b. self – management c. social awareness d. social skills 
• How are emotional intelligence competencies measured ?
• Observations, particularly 360° assessments.
• The effects of conventional management training seem to vanish within a few months.
• Emotional intelligence can be developed, but this will not happen in traditional developmental programs. First, managers must want to change. Then there must be a realistic learning agenda and the opportunity to practice the competencies. It requires a significant personal effort and time.
• One of the things that you should be looking for when making people decisions is potential. What is potential? Ambition + ability to learn from experience.
• What is ambition? Need for achievement + need for affiliation + need for power .
• Should you be looking at values when evaluating someone? Yes. Should you aim to develop those values? No.
• The right people share the core values of an organization. A company can teach skills, but not character. You’re better off finding someone who’s already on board with your values ,
• What about the concept of teams? Performance depends on good team work. Effective teams easily outperform individual stars. Aim for competency diversity in your teams.
• Summary a. Never compromise on values. b. IQ is indeed important.  c. EQ – based competencies are absolutely essential. d. Hire individuals with high potential. e. For very senior positions, experience assumes more importance. 
• Avoid the trap of thinking that any single candidate will have every quality.

CHAPTER SIX – Where to Look: Inside and Out

• When is it better to go for outsiders versus insiders?
• Statistically, promoting an insider doesn’t have a significant impact on company performance. 
• Outsiders add great value when the predecessor was fired and change is needed. Outsiders destroy value when the succession is natural (retirement.)
• When promoting an insider, always make sure that the person you are promoting has the necessary capabilities. Insiders tend to get scrutinized less carefully than outsiders.
• Large companies skilled at developing internal people, such as GE, will quite likely have the best candidates within. 
• Always better to consider both internal and external candidates for a search .
• Companies underinvest significantly in the generation of potential candidates.
• How do you know when to stop looking ?
• Statisticians have demonstrated that in such a situation , the best strategy is the “37 Percent Rule .” You would need to interview and pass on at least 37 people women (on a base of 100) and hire the next person who is more qualified than the best from the 37.
• It’s more practical to reduce this rule from 37 to 12. 
• Because candidates are also evaluating you, statistics says to interview 20 individuals before setting your aspiration level.
• Remember to look internally, scrutinize insiders just as carefully, and invest time building an internal talent pipeline.
• How do people find jobs?
• Personal contacts were the predominant method of finding out about jobs. Weak ties were the key, so develop a good personal network.
• Job postings have serious limitations. It is hard to get the attention of the best candidates. The pool of respondents is typically very large, but of very limited quality.
• The preferred strategy for sourcing is not to think about candidates, but to think about people who may know the best candidates. It makes much more sense to drum up people who are likely to know of several high-quality candidates right off the bat.

CHAPTER SEVEN – How to Appraise People

• Investing time, effort, and money in better assessments is your largest opportunity for making great people decisions.
• The best tradeoff for the candidate and the company is a combination of effective interviews and reference checks.
• There is always some analysis of a resume, however, the vast majority of resumes are misleading.
• Reference checks are typically used in practice to eliminate candidates.
• Interviewing can be improved by the use of the situational interview and the behavioral interview.
• Untrained interviewers make snap judgments and then look for evidence to support those judgments.
• Most interviews are ineffective at best, highly unstructured, with the interviewer doing most of the talking.
• The key to effective interviewing is first identifying the critical competencies, for this particular position, and describing them in behavioral terms. 
• Past behaviors are the best basis for predicting future behavior.
• If you focus only on the critical competencies, you will achieve much better assessments and much more powerful people decisions , and do less work in the process.
• In short, research confirms that identifying the relevant competencies for a job, and assessing them through effective interviews, is an extremely valid and powerful way to predict outstanding performance.
• There are two distinct approaches to the structured interview: behavioral questions (past behavior) and situational questions (hypothetical behavior). I prefer behavioral questions.
• Effective interviewing requires significant preparation. Your questions should be focused on behaviors, and should be followed up with significant probing to understand what was the candidate’s exact role, and what were the consequences of his or her actions.
• Interviewing skills can be learned through role-playing, often videotaped, training sessions.
• Proper reference checks are an essential condition for success in any assessment.
• When I asked Jack Welch how he really found out about a person. He told me that he never trusted the references given by the candidate. 
• Weeding out the outright fakes is entry-level reference checking. Second level involves finding people who can confirm that your candidate’s self-reported achievements are real. A third type of reference helps you hone in on competence and potential.
• A former boss would tend to be very good for assessing things like results orientation and strategic orientation. A peer would be well positioned to assess collaboration and influencing skills. Direct reports could comment on the candidate’s competence in the areas of team leadership.
• Some interviewers are better than others. The best interviewers had predictive validities 10 times bette. R
• Instead of a panel interview, have more than one highly effective interviewers independently in the finalist.
• Team interviews can be more effective for higher-level positions, more complex jobs. They also reduce the duplication and exhaustion of back-to-back interviews.
• When the final decision approaches, strict discipline becomes absolutely crucial. All too often, expediency intervenes, discipline breaks down , and terrible people mistakes are made. “Discipline” means reviewing, once again, the performance expectations, and reviewing the evidence
• Once you become more experienced you can listen more to your own intuition. Until then, you should question your intuition frequently.
• Developing your assessment skills will be key for your career success and for your company’s success.
• Invest in good interview training.
• Review the recruitment and interview process. 
• Remember to review people decisions again, one or two years down the road.
• Be willing to undo a bad decision .

CHAPTER EIGHT – How to Attract and Motivate the Best People

• The first critical step of selling a job is understanding the main motives and the primary concerns of the candidates.
• Anyone can hire average people. Hiring the best people, especially those who aren’t looking for a job, demands your best.
• Take time to understand the candidates and their motivations. Address your concerns. Share your passion about your company, your projects, and the job you are offering.
• Make sure that your compensation packages are aligned with your retention priorities. 
• The evidence about the inherent power of “pay for performance” is surprisingly inconclusive.
• A reasonably high level of total compensation is needed to attract the best .
• Balance long-term with short-term incentives. Long-term incentive should be along the lines of restricted shares rather than stock options (which have strong upside but limited downside.) Short-term incentives might be a yearly bonus.
• Most complex jobs require collaboration, and therefore individual incentives can be extremely negative.
• Avoid the “golden parachute,” which creates a perverse incentive to promote conflict and get fired.
• The signing bonus is nearly as bad , because it pays reluctant candidates to suspend their judgment about the job to earn the signing bonus.
• What candidates look for, first and foremost, is not more money, but a job where they can do their best, with a challenge that perfectly matches their skill level, in a place where they will grow and develop, in an organization they like, with a good boss and a great group of peers.
• You want the right candidate, one who really cares about the job and the organization.
• If you have the right people, they will do everything in their power to make the company great. —Jim Collins
• When working with an executive search firm, a fixed flat fee and a retainer arrangement can sidestep all of these fee-related structural problems . It can reinforce personal trust with structural integrity.

CHAPTER NINE – How to Integrate the Best People

• Bringing a spacecraft safely back to Earth is similar to integrating a successful candidate into a new job.
• External candidates are usually expected to hit the ground running and also often have a compensation package that creates jealousy and resentment.
• The Dynamics of Taking Charge by John J . Gabarro is the best book ever written on the integration of new managers.
• Integration is hard. Integration takes time. If managers act too quickly, they may do so based on the wrong diagnosis, and fail. If they take too long, they will frustrate the organization.
• The manager most likely to fail at integration is the “Lone Ranger,” who can’t involve others in the learning and action stages. So, hire emotionally and socially intelligent managers who can get others to help them in the diagnostic phase. 
• To avoid integration failures: be aware of the common traps, prepare the manager, and follow up closely. 
• When it’s clear the integration isn’t working, pull the plug. This is never easy.
• New managers should always have a sponsor, a champion. The power of “personal touch” can’t be overemphasized. There’s simply no substitute for one-on-one sessions .

CHAPTER TEN – The Bigger Picture

• Just like hiring and promoting, delegating more often and more effectively improves your organization’s results, and helps ensure your own career success.

You don’t have to work miserable 60 / 80 / 100 – hour weeks to make it work. You don’t even need an office.

Ignore the real world. It’s a place where new ideas , unfamiliar approaches , and foreign concepts always lose .

Learn from your successes. Failure is not a prerequisite for success.

Long-term business planning is a fantasy. You have to be able to improvise. This isn’t to say you shouldn’t think about the future or contemplate how you might attack upcoming obstacles. That’s a worthwhile exercise. Just don’t feel you need to write it down or obsess about it. Working without a plan may seem scary. But blindly following a plan that has no relationship with reality is even scarier.

Why grow? Why is expansion always the goal? You’ll need a better answer than “economies of scale.” Grow slow and see what feels right. Premature hiring is the death of many companies. Once you get big, it’s really hard to shrink without firing people, damaging morale. Runs a business that’s sustainable and profitable.

Workaholism is stupid. Working like crazy just isn’t sustainable. Workaholics try to make up for intellectual laziness with brute force. Workaholics create guilt and poor morale among their coworkers. You end up just plain tired. No one makes sharp decisions when tired. The real hero is already home because she figured out a faster way to get things done.

Instead of entrepreneurs, let’s just call them starters.

To do great work, you need to feel that you’re making a difference. This doesn’t mean you need to find the cure for cancer.

Scratch your own itch.

Start by making something, now. What you start is what matters, not what you think or say or plan to start. Ideas are cheap and plentiful.

The most common excuse people give: “There’s not enough time.” There’s always enough time if you spend it right.

Keep in mind why you’re doing what you’re doing. A strong stand is how you attract superfans, not just customers. Also, when you stand for something, decisions are obvious. Ex: Whole Foods.

Be authentic with your mission statement. Having an authentic mission statement means truly standing for something.

Outside money is Plan Z. When you take outside money, you give up control. The pursuit of “cashing out” begins to trump building a quality business. Spending other people’s money is addictive. Customers move down the totem pole. Raising money is incredibly distracting. You start having meetings with your investors and / or board of directors.

You need less than you think. There’s nothing wrong with being frugal. Great companies start in garages all the time.

Start an actual business not a startup. Actual businesses worry about profit from day one.

You need a commitment strategy, not an exit strategy. You’ll be able to focus on getting customers to love you, instead of getting acquired.

Be the smallest, the leanest, and the fastest. Avoid: excess staff, meetings, thick process.

Constraints are actually advantages in disguise. Southwest — unlike most other airlines, which fly multiple aircraft models, flies only Boeing 737s. Because of this, Southwest has lower costs and a business that’s easier to run.

You just can’t do everything you want to do and do it well. Sacrifice some of your darlings for the greater good. Getting to great starts by cutting out stuff that’s merely good .

There’s the stuff you could do, the stuff you want to do, and the stuff you have to do. Find out what’s essential and focus all your energy on making it the best it can be.

Ignore the details early on. Nail the basics first and worry about the specifics later. We sketch out ideas with a big, thick Sharpie marker, instead of a ballpoint pen.

Long projects zap morale.

Be a curator. Constantly look for things to remove, simplify, and streamline.

Gordon Ramsay’s first step is nearly always to trim the menu. When things aren’t working, cut back.

Focus on what won’t change. The core of your business should be built around things that won’t change. Things that people are going to want today and ten years from now. Those are the things you should invest in. Eg. Amazon and Japanese automaker focus on core principles.

It’s not the gear that matters. Content is what matters.

Launch now. Once your product does what it needs to do, get it out there. When you impose a deadline, you gain clarity.

Instead of describing what something looks like, draw it. Get to something real (a prototype) right away because people need to see something to start working on it.

Sometimes abandoning what you’re working on is the right move.

Interruption is the enemy of productivity. Long stretches of alone time are when you’re most productive. Use email, over chat/meetings/call, as much as possible.

Meetings are toxic. The true cost of meetings is staggering.

If you must have a meeting, follow these simple rules: set a timer, invite as few people as possible, always have a clear agenda, meet at the site of the problem, end with a solution.

Good enough is fine. Aim for maximum efficiency with minimum effort. Problems can usually be solved with simple, mundane solutions. When good enough gets the job done, go for it.

Quick wins. Momentum fuels motivation. No one likes to be stuck on an endless project. The longer something takes, the less likely it is that you’re going to finish it. Small victories let you celebrate and release good news. Ask: “What can we do in two weeks?”

Don’t be a hero. If you already spent too much time on something that wasn’t worth it, walk away. You can’t get that time back.

Forgoing sleep is a bad idea.

We’re all terrible estimators. Estimates that stretch weeks, months, and years into the future are fantasies. The solution : Break the big thing into smaller things.

Start making smaller todo lists. Prioritize visually. Put the most important thing at the top.

Make tiny decisions by breaking up big decisions. Smaller, attainable goals like that are the best ones to have .

Don’t copy. Copying skips understanding — and understanding is how you grow. When you copy, you never lead, you always follow.

Make you part of your product or service. Zappos sets itself apart by injecting CEO Tony Hsieh’s obsession with customer service into everything it does. Polyface sells the idea that it does things a bigger agribusiness can’t do .

Being the anti – ______ is a great way to differentiate yourself and attract followers. Having an enemy gives you a great story to tell customers, too.

Underdo your competition. Solve the simple problems and leave the hairy, difficult, nasty problems to the competition.

It’s not worth paying much attention to the competition. Focus on competitors too much and you wind up diluting your own vision. Focus on yourself instead.

Say no by default. Use the power of no (to certain customers) to get your priorities straight. Recommend a competitor if you think there’s a better solution out there.

Let your customers outgrow you.

Don’t confuse enthusiasm with priority. The enthusiasm you have for a new idea is not an accurate indicator of its true worth.

To create a product that exceeds expectation, you might need to promise a bit less. Over-promising and under-delivering is like a one-night stand. You don’t want a one-night stand with your customers, you want a long-term relationship.

Being obscure is a great position to be in. When you’re obscure, you can try new things. No one knows you, so it’s no big deal if you mess up.

Build an audience. An audience can be your secret weapon. Every day they come back to see what we have to say. When you build an audience, you don’t have to buy people’s attention — they give it to you. Share information that’s valuable and you’ll slowly but surely build a loyal audience.

Teaching probably isn’t something your competitors are even thinking about. Etsy teaches. Gary Vaynerchuk teaches. Teach and you’ll form a bond you just don’t get from traditional marketing tactics.

Give people a backstage pass and show them how your business works. People love finding out the little secrets of all kinds of businesses.

Don’t be afraid to show your flaws. Imperfections are real and people respond to real.

Press releases are spam. Instead, call someone. Write a personal note.

Forget about the Wall Street Journal. You’re better off focusing on getting your story into a trade publication or picked up by a niche blogger.

Marketing is something everyone in your company is doing 24 / 7 / 365.

The myth of the overnight sensation. Dig deeper and you’ll usually find people who have busted their asses for years. It’s hard, but you have to be patient. Starbucks, Apple, Nike, Amazon, Google, and Snapple all became great brands over time, not because of a big PR push upfront. Start building your audience now.

Never hire anyone to do a job until you’ve tried to do it yourself first.

The right time to hire is when there’s more work than you can handle for a sustained period of time.

Pass on hiring people you don’t need, even if you think that person’s a great catch. Don’t worry about “the one that got away.”

Hire slowly. Hire a ton of people rapidly and a “strangers at a cocktail party” problem where everyone tries to avoid any conflict or drama. No one says, “This idea sucks.”

We all know resumés are a joke. The cover letter is a much better test than a resumé.

There’s surprisingly little difference between a candidate with six months of experience and one with six years. How long someone’s been doing it is overrated. What matters is how well they’ve been doing.

Don’t fall into the trap of thinking you need someone from one of the “best” schools in order to get results.

With a small team, you need people who are going to *do* work, not *delegate* work. Avoid hiring delegators. Delegators love to pull people into meetings ,

Hire managers of one. They don’t need a lot of hand-holding or supervision. They’ve run something on their own or launched some kind of project .

Hire great writers. If you are trying to decide among a few people to fill a position, hire the best writer. Clear writing is a sign of clear thinking .

It’s crazy not to hire the best people just because they live far away. To make sure your remote team stays in touch, have at least a few hours a day of real-time overlap. Meet in person once in a while .

Test out employees. You need to evaluate the work they can do now, not the work they say they did in the past. Hire them for a mini-project.

Own your bad news. When something bad happens, tell your customers.

Getting back to people quickly is probably the most important thing you can do when it comes to customer service.

A good apology accepts responsibility. If you’ve built rapport with customers, they’ll cut you some slack and trust you when you say you’re sorry.

Put everyone on the front lines. Good restaurants sometimes have chefs work out front as waiters for a stretch. Listening to customers is the best way to get in tune with a product’s strengths and weaknesses. The more people you have between your customers ’ words and the people doing the work, the more likely it is that the message will get lost or distorted along the way.

After you introduce a new feature , change a policy , or remove something , knee – jerk reactions will pour in. Ride out that first rocky week. Make sure you don’t foolishly backpedal on a necessary but controversial decision. Let them know you’re listening .

You don’t create a culture. It happens .

Culture is the byproduct of consistent behavior. If you treat customers right, then treating customers right becomes your culture. So don’t worry too much about it. Don’t force it. You can’t install a culture. Like a fine scotch, you’ve got to give it time to develop.

Don’t make up problems you don’t have yet. Most of the things you worry about never happen anyway. Optimize for now and worry about the future later. The ability to change course is one of the big advantages of being small.

Skip the rock stars. The environment has a lot more to do with great work than most people realize. Rockstar environments develop out of trust, autonomy, and responsibility.

When everything constantly needs approval, you create a culture of non-thinkers. Realize that failing to trust your employees is awfully expensive .

Send people home at 5. You shouldn’t expect the job to be someone’s entire life.

Policies are organizational scar tissue. Don’t create a policy because one person did something wrong once. Policies are only meant for situations that come up over and over again.

Talk to customers the way you would to friends. Avoid jargon. Don’t talk about “monetization” or being “transparent;” talk about making money and being honest.

Write to be read, don’t write just to write. Whenever you write something, read it out loud. When you’re writing, think of the person who will read your words.

Four-letter words you should never use in business: need, must, can’t, easy, just, only, and fast. Need: very few things actually need to get done. Can’t: you probably can. Easy: people rarely say something they have to do is easy.

Stop saying ASAP: when everything is high priority, nothing is.