Apr, 2017

Step 22: The Seven-Fold Path To The Obvious Signs

benmunoz
April 15, 2017
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The Big Idea: Experiment. Experiment. Experiment.

  • Set the right goals and cut out anything that is not moving you towards your goals.
  • Don’t delude yourself.  Embrace the truth when you’re asking yourself if you’re moving towards your goals.
  • Jeff Bezos is one of the best in the world at seeking and embracing the truth, especially through experimentation.
  • The seven steps towards moving towards your goals
    • 1. Ask question. (set a goal)
    • 2. Research answer. (find some approaches)
    • 3. Make a hypothesis. (try one approach)
    • 4. Test it.
    • 5. Observe.
    • 6. Evaluate observation.
    • 7. Ask smart people to review your progress. (don’t quit; just try a different approach)
  • People are more likely to be consistent than to experiment to find the best approach.
  • Don’t be stuck by the need to be consistent with your first approach.  Consistency and commitment are very common cognitive biases.
  • Experiment. Experiment. Experiment.

Tai Lopez is an entrepreneur, investor, and blogger who runs an awesome online book club. 67 Steps is a lecture series teaching how to be successful in health, wealth, love, and happiness.  I’m a big fan.

The Goal by Eliyahu Goldratt and Jeff Cox

benmunoz
April 5, 2017
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The Big Idea: identify the bottleneck.  Relieve the bottleneck.  Repeat.

  • The Goal is one of Jeff Bezos’ three required books for his senior team. (Also, Effective Executive and Innovator’s Dilemma)
  • Cost accounting conventions lead businesses to focus on the wrong things.
  • The goal of a business is to make money. Therefore, every operational metric should link back to profit.
  • There are only three operational metrics that matter: 1) throughput, 2) inventory, 3) operational expense.
  • Throughput is money generated when products go out the door.
  • Inventory is money locked up in work in process until products go out the door.
  • Operational expense is money required to generate throughput.
  • Of these, throughput is by far the most important.
  • The most important objective is to increase throughput.
  • How do you increase throughput?  Identify the bottleneck (ignore everything else), relieve the bottleneck, repeat.