Guy Raz, on the NPR podcast How I Built This, often asks his interviewees if they believe that their success was due to luck or hard work. This is one of my favourite bits of the show and the reason that I bought the book Smart or Lucky? by Judith Hurwitz. I know from the last 3 years at working at Generate Solutions, that I have been incredibly lucky to have certain opportunities come my way. However, I also know that it takes more than just the first opportunity to turn something into success. That requires more luck and more hard work. But, this is just my opinion and, I was interested to know what a researched expert thought about the delicate balance of luck and business smarts. Hurwitz, in her introduction, says that:
“When luck and smarts come together, magic can happen“
Innovation is about the future
Ok, so it sounds pretty obvious. And yet, for pretty much every industry, the newest innovations have come from start-ups, not market leaders. Why is this? Well, one suggestion is that market leaders are too busy serving the current needs of their clients to be able to project far enough into the future to satisfy their unknown requirements. Kodak is often cited as the company that failed to adapt to a changing market and was too steadfast in the belief that their current product met all their customers current and future needs. Instagram would argue differently.
You make your own luck
I’ve had many a passionate, late-night debate about this one. Is luck something that happens to us? Or something that we help construct?
Thomas Jefferson said:
“I am a great believer of luck, and I find the harder I work, the more I have of it”
I don’t think you can go around winning arguments just by citing former Presidents, but I think we are partly responsible for the number of opportunities we create. For example, I know lots of freelance workers who are excellent at what they do, but they complain about not having enough business. Yet, when really pushed about what they have done to generate more work, the answer is, not a lot. Opportunities come from people and ideas come from engaging with the world around us. If you construct a life that stops you from doing either it is unlikely, that success will fall neatly into your lap.
The counter-argument, that I accept in part, is that we are often gifted some lucky fundamentals. So Bill Gates, had the smarts, he definitely did the work, but he also was in a fortunate position to start that he had access to a computer from a young age and had the opportunities to pursue his passion. Had he been born elsewhere, had been a different race or gender, the story may have been very different.
Make sure your users understand you
This one is true for technology and every other business ever created. Companies, myself included, fail time and time again, in explaining clearly what we do and what the value is. Put quite simply by Hurwitz “customers do not buy what they do not understand”. It is far better to focus on the results of the technology rather than the complexities that have gone into developing it. Quite simply, most customers don’t care about the R&D, they care about the bottom line results for their business.
How to win them back
Like any failed relationship, there is often the opportunity for redemption, unless you have done something so catastrophically awful that there is no going back. If you want to get your customers back, you need to regain their trust. Always easier said than done.
To do this you need to listen to what they are saying and then take action to resolve their complaints. Often companies spend time listening, either through social media or through surveys, only to decide the customer is wrong and doesn’t know what they are talking about. If your turnover or profit has steadily been decreasing this is probably a good indication that your customers are giving you valuable feedback that you need to take on-board.
Google and Amazon sneak attacks
Two companies which are cited as “sneak attack” success stories are Amazon and Google. It is important to remember that this book was written in 2011 and both companies have evolved incredibly since then. The points that are made, however, are still valid. Google, employed a smart strategy to gain market space and the use and development of Android was incredibly smart. The Google model, largely, remains unchanged. Give away top performing products for free and generate revenue through successful advertising.
Everyone knew Amazon as the online bookseller, yet quickly, Amazon has become a data storage expert, online retailer and media broker (through Prime). All of this has happened quickly and the competition, time after time, has been slow to react. The vision statement has always reflected the broader ambition of Amazon and how it would be achieved: “the world’s most customer centric company”
Patterns of failure
This is a small section in the book but an important one. We often focus on the success of companies, especially within a bubble. So now everything is about the sharing economy and scalable platforms. But it is also important to pay attention to the patterns of failure. Why have some competitors disappeared? What do they have in common? How can you stop your business coming down with the same affliction? It might be easy to cheer out a competitor, but those who excel in the future will use their mistakes as an opportunity to improve their business.
Lessons learned
I really liked the format employed across this book. Each chapter was neatly summarised by “lessons learned”. As expected the conclusion is that success comes from both luck and smarts. But, that generally, the harder you work and the better your strategy, the more luck will come your way. This is best summaries by Josh Billings:
As long as we are lucky we attribute it to our smartness; our bad luck we give the gods credit for
