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Work on Stuff that Matters: First Principles - O'Reilly Radar

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Work on Stuff that Matters: First Principles

by Tim O'Reilly | @timoreilly | +Tim O'Reilly | January 11, 2009

I spent a lot of last year urging people to work on stuff that matters. This led to many questions about what that “stuff” might be. I’ve been a bit reluctant to answer those questions, because the list is different for everyone. I thought I’d do better to start the new year with some ideas about how to think about this for yourself.

First off, though, I want to make clear that “work on stuff that matters” does not mean focusing on non-profit work, “causes, or any other form of “do-goodism.” Non-profit projects often do matter a great deal, and people with tech skills can make important contributions, but it’s essential to get beyond that narrow box. I’m a strong believer in the social value of business done right. We need to build an economy in which the important things are paid for in self-sustaining ways rather than as charities to be funded out of the goodness of our hearts.

There are a number of half-unconscious litmus tests I use in my own life. I’m going to try to tease them out here, and hope that you can help me think this through in the comments.

Work on something that matters to you more than money.

I addressed this topic in my commencement address at SIMS a few years ago, and I’ll think I’ll just quote myself here.

Some of you may end up working at highflying companies. Some of you may succeed, and some of you may fail. I want to remind you that financial success is not the only goal or the only measure of success. It’s easy to get caught up in the heady buzz of making money. You should regard money as fuel for what you really want to do, not as a goal in and of itself. Money is like gas in the car — you need to pay attention or you’ll end up on the side of the road — but a well-lived life is not a tour of gas stations!

Whatever you do, think about what you really value. If you’re an entrepreneur, the time you spend thinking about your values will help you build a better company. If you’re going to work for someone else, the time you spend understanding your values will help you find the right kind of company or institution to work for, and when you find it, to do a better job.

Don’t be afraid to think big. Business author Jim Collins says that great companies have “big hairy audacious goals.” Google’s motto, “access to all the world’s information” is an example of such a goal. I like to think that my own company’s mission, “changing the world by sharing the knowledge of innovators,” is also such a goal.

Don’t be afraid to fail. There’s a wonderful poem by Rainer Maria Rilke that talks about the biblical story of Jacob wrestling with an angel, being defeated, but coming away stronger from the fight. It ends with an exhortation that goes something like this: “What we fight with is so small, and when we win, it makes us small. What we want is to be defeated, decisively, by successively greater things.”

One test of a bubble is how many entrepreneurs are focused on their upcoming payday rather than on the big things they hope to accomplish. Me-too products are almost always payday-focused; the entrepreneurs who first made the market often had much less expectation of easy success, and were instead wrestling, like Jacob with the angel, with a hard problem that they thought they could solve, or at the very least make a dent on.

It’s also clear that if you’re thinking more about the competition than you are about customers and the value you’re going to create for them, you’re on the wrong path. As Kathy Sierra once put it, “In many cases, the more you try to compete, the less competitive you actually are.”

The most successful companies treat success as a byproduct of achieving their real goal, which is always something bigger and more important than they are.

**Create more value than you capture.**

It’s pretty easy to see that Bernie Madoff wasn’t following this rule; nor were the titans of Wall Street who ended up giving out billions of dollars in bonuses to themselves while wrecking our economy. It’s harder to judge the average small business, but it’s pretty clear that most businesses do in fact create value for their community and their customers as well as themselves, and that the most successful businesses do so in part by creating a self-reinforcing value loop with their customers.

For example, a bank that loans money to a small business sees that business grow, perhaps borrow more money, hire employees who make deposits and take out loans, and so on. The power of this cycle to lift people out of poverty has been demonstrated by microfinance institutions like the Grameen Bank. Grameen is clearly focused on creating more value than they capture; not so the like of Fannie Mae and Freddy Mac, or WaMu, or many of the other failed financial institutions involved in the current financial meltdown. They may have started there, but at some point, they clearly became more concerned with how much value they could capture for themselves.

If you’re succeeding at this goal, you may sometimes find that others have made more of your ideas than you have yourself. It’s OK. I’ve had more than one billionaire (and an awful lot of startups who hope to follow in their footsteps) tell me how they got their start with a couple of O’Reilly books. I’ve had entrepreneurs tell me that they got the idea for their company from something I’ve said or written. That’s a good thing! I remember back in the early days of the Internet, when the buyer at Borders told me after one of my talks, “Well, you’ve just given your competitors their publishing program for the year.” If my goal is really “changing the world by spreading the knowledge of innovators,” I’m thrilled when my competitors jump on the bandwagon and help me spread the word!

Look around you: How many people do you employ in fulfilling jobs? How many customers use your products to make their own living? How many competitors have you enabled? How many people have you touched that gave you nothing back?

There’s a wonderful section in Les Miserables about the good that Jean Valjean does as a businessman (operating under the pseudonym of Father Madeleine). Through his industry and vision, he makes an entire region prosperous, so that “there was no pocket so obscure that it had not a little money in it; no
dwelling so lowly that there was not some little joy within it.” And the key point:

Father Madeleine made his fortune; but a singular thing
in a simple man of business, it did not seem as though that were his
chief care. He appeared to be thinking much of others, and little of
himself.

Focusing on big goals rather than on making money, and on creating more value than you capture are closely related principles. The first one is a test that applies to those starting something new; the second is the harder test that you must pass in order to create something enduring.

Take Microsoft. They started out with a big goal, “a computer on every desk and in every home,” and for many years unquestionably created more value than they captured. They helped grow the PC industry as a whole; they built a platform that helped many small software vendors to flourish. But over time, they began to capture more value than they created: as the cost of PCs plummeted, hardware vendors had to survive on the slimmest of margins while Microsoft collected monopoly rents; bit by bit, Microsoft consumed its own developer ecosystem by building the features of successful startups into their own products, and using their operating system dominance to crush the early movers. As I’ve written elsewhere, I believe that Microsoft must re-commit itself to big goals beyond its own profitability, and to creating more value than it captures if it is to succeed. (Danny Sullivan wrote a great piece about the strategic relevance of this very idea just last week, Tough Love for Microsoft Search.)

Or take Google. Again, a huge goal: “Organize all the world’s information.” And like Microsoft in its early years, they are enabling others while making a pile of money for themselves. Any business with a web presence need only take a look at its referrer logs if it questions that assertion. How much of your traffic comes from Google? But again, as I’ve written previously, this test still looms in Google’s future. Will they continue to create more value than they capture, or will they seek to capture more of the value for themselves?

It’s a matter of balance. Every business needs to pay attention to its bottom line; every individual needs to put a roof over his or her head and provide food for loved ones. But take a look inside: how much are you thinking about yourself and what you might gain, versus what you might create?

It’s particularly tough to stay focused on big issues in the face of an economic downturn, because getting paid looms large. I look back at some of the decisions I made after the crash in 2001, when I became far more focused on the survival of my business than on the value we were going to create in the marketplace. We did some me-too publishing that I really regret; the things that ultimately made a bigger difference to our bottom line were commitments to the future: our Web 2.0 events were driven by the goal of reigniting enthusiasm in the computer industry as well as helping people to understand the new rules of the emerging internet platform; Safari Books Online was driven by the desire to create a new revenue model not just for ourselves but for all publishers; Make: was a celebration of the next generation of hackers; Foo Camp started as a way to give something back to all the people who’d contributed to our success.

But these two tests are not enough, because it’s become clear that we need a long term ecological perspective as well. So I’d add a third principle:

3. Take the long view.

Brian Eno tells a great story about the experience that led him to conceive of the ideas that led to The Long Now Foundation:

It was 1978. I was new to New York. A rich acquaintance had invited me to a housewarming party, and, as my cabdriver wound his way down increasingly potholed and dingy streets, I began wondering whether he’d got the address right. Finally he stopped at the doorway of a gloomy, unwelcoming industrial building. Two winos were crumpled on the steps, oblivious. There was no other sign of life in the whole street.

“I think you may have made a mistake”, I ventured.

But he hadn’t. My friend’s voice called “Top Floor!” when I rang the bell, and I thought – knowing her sense of humour – “Oh – this is going to be some kind of joke!” I was all ready to laugh. The elevator creaked and clanked slowly upwards, and I stepped out – into a multi-million dollar palace. The contrast with the rest of the building and the street outside couldn’t have been starker.

I just didn’t understand. Why would anyone spend so much money building a place like that in a neighbourhood like this? Later I got into conversation with the hostess. “Do you like it here?” I asked. “It’s the best place I’ve ever lived”, she replied. “But I mean, you know, is it an interesting neighbourhood?” “Oh – the neighbourhood? Well…that’s outside!” she laughed.

In the talk many years ago where I first heard him tell this story, Brian went on to describe the friend’s apartment, the space she controlled, as “the small here,” and the space outside, full of winos and derelicts, as “the big here.” He went on from there, along with others, to come up with the analogous concept of the Long Now.

It’s very easy to make local optimizations, but they eventually catch up with you. Our economy has many elements of a ponzi scheme. We borrow from other countries to finance our consumption, we borrow from our children by saddling them with debt and using up non-renewable resources.

It’s hard to see beyond the “small here” and the “short now,” especially if you live in a favored place and time. That’s why so many of the really important things do end up on the plates of non-profits.

That’s why a time like this, when the bubble is bursting, is a great time to see how important it is to think about the big picture, and what matters not just to us, but to building a sustainable economy in a sustainable world.

tags: stuff that matters