It’s that time again! No, not turkey-stuffing-cranberry-yam-and-marshmallow sandwich time. No, not pepper-spray-your-fellow-Black-Friday-shoppers time. No, silly… it’s Biz Book Friday! Today, a little change of pace: Peter Drucker. And puppies.
Who wants to start a business? You do!
Who wants to pet a puppy?
You do!
So… which puppy do you pet?
Well, that depends, I suppose.
Exactly how attached are you to that hand?
Towards a Philosophy of Puppy Stroking
Say you are an indiscriminate puppy pat-er. You see four legs and a tail and you just can’t keep your hands to yourself.
So you walk by the junkyard one day and LOOK! A PUPPY! Your tic kicks in. You slip your fingers through the chain link fence so that you can get your puppy fix. From the 150-pound, slavering, red-eyed menace. Here, boy!
One day, I expect, you will find yourself to be a very excellent one-handed typist.
But what if you practice safe pets?
What if you limit your doggy-stroking adventures to the fluffy pom used for animal therapy visits at the local preschool?
The chances are extremely good that you will die of old age and be buried with a full complement of 10 wiggly little digits.
Puppies are Serious Business™… and risk is a lie
We’re talking about puppies, but we’re really talking about your business. Get it? Whether you call it a “startup” or “small business,” a “lifestyle business” or a “baconbiz” or “my little side gig,” the facts are the facts:
Risk is not risk.
We talk about it like it’s a real, concrete, immutable thing.
But risk is like puppy-petting: it involves choices. You can choose to be smart, and snuggly, or dumb, and finger-less.
I’m not saying that there’s anything wrong with a high-risk venture. But it’s far from the only choice… and what’s more, even things you’d assume are high-risk don’t have to be.
Risk is not absolute. It depends on your choices. Yes, that’s right: you get to choose how much risk to expose yourself to. Amazing!
Old school biz peeps know this — startups don’t
Entrepreneurship is “risky” mainly because so few of the so-called entrepreneurs know what they are doing. They lack the methodology. They violate elementary and well-known rules. This is particularly true of high-tech entrepreneurs.
Ahhh, the bitchslap of reality. From the past.
That passage hails from Peter Drucker’s Innovation and Entrepreneurship, published in 1985. Yes, over 26 years ago.
Still true. True-r, even.
Peter Drucker’s got a drum — a true-r drum — and he’s gonna beat it, giving us all a good what-for:
Those entrepreneurs who start out with the idea that they’ll make it big—and in a hurry—can be guaranteed failure. They are almost bound to do the wrong things.
Oh, really, Peter Drucker? Tell us more!
The entrepreneur is therefore well advised to forgo innovations based on bright ideas, however enticing the success stories. After all, somebody wins a jackpot on the Las Vegas slot machines every week, yet the best any one slot-machine player can do is try not lose more than he or she can afford.
We need to systematize, he tells us. (Sound familiar?) We need to base our entrepreneurship off research and analysis and understanding, rather than woo-woo hand-waving and hagiography and awed, prideful worship of the “bright idea.”
And, he says, people get really confused about what high-tech entrepreneurship looks like.
Junkyard Dog Alert: trying to be Fustest with the Mostest?
Drucker describes 4 basic entrepreneurial strategies. One of them is “Fustest with the Mostest,” a humorous dialect misquotation of Confederate Lieutenant General Nathan Bedford Forrest’s strategy of arriving first to battle with the most men and firepower:
In this strategy the entrepreneur aims at leadership, if not at dominance of a new market or a new industry…
That does sound awfully familiar, doesn’t it? It sounds like what everybody and their finger-crunching dog say about how to do a startup:
- Shoot for the moon
- Get there first
- Dominate
- Grow big
Being “Fustest with the Mostest” is the approach that many people consider the entrepreneurial strategy par excellence.
This is true.
Indeed, if one were to go by the popular books on entrepreneurs, one would conclude that being “Fustest with the Mostest” is the only entrepreneurial strategy — and a good many entrepreneurs, especially the high-tech ones, seem to be of the same opinion.
Right you are, Mr. Drucker!
They are wrong, however… monocle tweak
What’s that you say? WHAT??
“Fustest with the Mostest” is not even the dominant entrepreneurial strategy, let alone the one with the lowest risk or the highest success ratio. monocle polish On the contrary, of all entrepreneurial strategies it is the greatest gamble.
Oh no! The greatest gamble? I don’t believe it! But it must be true… you have a monocle!
Do go on.
And it is unforgiving, making no allowances for mistakes and permitting no second chance.
Argghghg, why?
“Fustest with the Mostest” is very much like a moon shot: a deviation of a fraction of a minute of the arc and the missile disappears into outer space.
BUT… isn’t that good?
The entrepreneur of so much of the popular literature or of Hollywood movies, the person who suddenly has a “brilliant idea” and rushes off to put it into effect, is not going to succeed with it.
In fact, for this strategy to succeed at all, the innovation must be based on a careful and deliberate attempt to exploit one of the major opportunities for innovation that were discussed in Chapters 3 to 9.
AWWW, NOOOOO, EVERYTHING I KNOW IS WRONG. TELL ME WHAT TO DO, PETER DRUCKER. Just give it to me straight. I can take it. cringe
["Fustest with the Mostest"] will fail because the will is lacking. It will fail because efforts are inadequate. It will fail because, despite successful innovation, not enough resources are deployed, are available, or are being put to work to exploit success, and so on.
While the strategy is indeed highly rewarding when successful, it is much too risky and much too difficult to be used for anything but major innovations, for creating a new political order… or a new approach…
It requires profound analysis and a genuine understanding of the sources of innovation and of their dynamics. It requires an extreme concentration of effort and substantial resources.
In most cases alternative strategies are available and preferable — not primarily because they carry less risk, but because for most innovations the opportunity is not great enough to justify the cost, the effort, and the investment of resources required for the “Fustest with the Mostest” strategy.
NOOOOOOOOOOoooooOooooOoookay.
In conclusion: Peter Fucking Drucker says,
Back away from that junkyard dog
…unless you’ve got a mesh body suit with anti-flammable padding, a cage, a taser, pepper spray, a whip, a lion tamer sidekick, a djinn, and also ovaries of pure tungsten carbide*.
Your entrepreneurial mission, should you choose to accept it: find and snuggle a friendly pom. Mind the top hat.
And: Buy and read Innovation and Entrepreneurship. You’ll have to read it with the eyes of a soloist or tiny team in the 2010s, and interpret what he says to help you with your situation… and you’ll learn a shitload.
Happy petting.
** Tungsten carbide: the hardest metal that isn’t, in fact a diamond. Psh. Everybody knows diamonds aren’t metal.*
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I disagree, because I believe you are missing a fundamental economical variable: with high risk, volatility increases and provides a chance of higher payoff.
To examplify with your pets. The cute one had probably a high chance of having a line of people wanting to pet it. The dog likes petting, but he will not show much affection to your petting (“Next!”). No risk, no reward.
With the scary/ugly dog nobody wants to touch, you have to be stupid OR see the opportunity this dog might be extremely happy when it’s petted, and gives you endless dog-petting-joy… how to find out? Try it, and if it bites, well that’s the risk you took, a good doktor will help you out with your rabius shot.
There’s just one flaw in your argument: the vast majority of volatility and risk comes with absolutely no improved payoff, only suckitude.
that’s total bullshit, I agree with Yvo
My dad studied under Peter Drucker and growing up all I heard was how great this guy was.
I read a few of his books and I even own an autographed copy of; Innovation and Entrepreneurship (a book the Google guys also recommend.)
I don’t agree with alot of his teachings but you are right if you can take a step back and apply his many cautions to your own situation you can really learn a lot.
I feel blessed to have an entrepreneurial spirit and the caution instilled by a father who taught me to be more aware than the person next to me.
It never stops me from just closing my eyes and jumping every now and then.
Most important is to think independently and love what you do.
I understand the sentiment of this post, however the “shoot for the moon” business attitude (it’s an attitude, not a strategy), has it’s place as well.
Some people will no doubt hit the big time, and then so many more will fall somewhere in between meteoric success and absolute obscurity. This paradigm is in place everywhere in our world, from the very beginning of our journey. Everyone of us is the result of overcoming infinitesimal odds in order to even be conceived, 1 out of a few hundred million sperm.
We see it in sports where thousands must languish in the minors, making a pittance because they’re holding onto hope that they’ll make it to the big time. The same thing happens in Hollywood where every actor in LA is aspiring to have their big break.
This will always exist. There are always going to be people who for whatever reason want to try shoot for the stars, and whether that’s stupid or not doesn’t matter. If you look at it objectively it’s certainly stupid to try shoot for the moon. One could say it’s like buying a lottery ticket (even worse probably). The thing is it’s NOT like buying a lottery ticket. Because the longer you do it the better you get, and the better your odds of succeeding become so long as you don’t give up. For every Mark Zuckerberg there are a thousand other guys who didn’t even try, and maybe they shouldn’t have even bothered because they aren’t visionaries with the skills to pull it off.
It’s completely alright to live a small life, to make small contributions. Those contributions matter all the same. But trying to build something significant is no more deserving of being mocked. A lot of people would be better off just building some nice lifestyle businesses that allow them to live the “Four Hour Work Week”.
If you’re trying to build a big business because you want fame and fortune then you’re in it for the wrong reasons to start with. Focus on your love of the creative process. There is nothing wrong with wanting to build something big, the world needs those ideas too, perhaps more so.
My frustration with the “Four Hour Work Week” mentality of business building is that it’s very much congruent with wanting to check out of the world. Owning your own time I respect, but people also need to contribute something more than just a simple app. We should all be aiming for impact. What can you do to make the world a better place? How much impact can you have? There is nothing wrong with wanting to have a big impact.
I suppose at both ends of the spectrum you see the same problem. People want to have some lifestyle business because they don’t want to work, and then other people want to have some monster exit because they don’t want to work. If we all just focused on providing value to the world, it really wouldn’t matter what end of the spectrum we were on.
Oh yes, people who don’t build GIANT STARTUPS RAOARARRRRWWRRR are living “small lives” and “checking out”. Puhleez, how do you breathe with all the bullshit coming out of your mouth? Do you suffocate in elevators? Do you bring a special snorkel?
Peter Drucker had more knowledge about business — yes, big business — and life in his little palsied pinky than you have in your whole oversized comment and probably body.