Understanding your CSFs

Your CFS is your critical success factor. 

These are like KPIs but for the inputs that directly contribute to your success at any give task. 

There is a cause-and-effect relationship between CFSs and KPIs. 

Critical success factors are the causes for how you and why you succeed. 

KPIs are the effects of that success. 

I'll provide an example. 

If you were trying to lose weight one KPI might be the amount of weight you lose in a given week/month. Your CFSs might be the number of days you work out in the gym.

Your CFS is your how and your KPIs are your what. 

Incentives, Unintended Consequences, and Second Order Thinking

Incentives encourage behavior and one of those behaviors is gaming incentive structures.

One of the first things people do when they are offered an incentive is come up with ways they can game the incentive.

It is human nature. We are hard-wired for doing the least amount of effort for the maximum amount of gain.

Many managers and executives think incentives are like guardrails that guide specific behavior but they are more like a series of trap doors. They are unintentional devices to encourage unproductive and sometimes counterproductive behavior.

While many incentive structures are well-intentioned they sometimes miss the mark. It reminds me of the cobra snake problems in India. The towns were overrun with cobra snakes and the local government was going to pay a bounty for every dead cobra.

In theory, this was a solid plan that would use incentives and market forces to create an army of cobra eradicators.

But like any good incentive, there were people willing to figure out how to manipulate the incentive to their benefit. Shortly after the program launched people began breeding cobras in captivity. The cobras now had value on them and became a commodity worth having.

When the government realized the error they ended the program and now disincentivized to be holding dangerous snakes everyone did what they would naturally do in this situation they released them making the problem ten times worse.

So what happened here?

On paper, this was a solid plan. We have a problem we have people ready and willing to solve this problem and for that service, there was an exchange of value. It somehow missed the mark.

This is where the mental model second-order thinking comes into play.

Second-order thinking is the process of thinking through the consequences or outcomes of first-order decisions.

Asking yourself what are the possible outcomes or unintended consequences of this decision.

Of course, this is not a catch-all it's impossible to think through every conceivable outcome. It is also not productive to think through any and all scenarios. It is a useful exercise to think through likely outcomes and play devil's advocate.

Asking yourself questions like how could this go wrong? What happens if we do X or Y?

Walking through second-order thinking allows you to think through all aspects of the decision from a 360-degree angle.

The Map is not the Terrain

The map is not the terrain is a mental model that is useful when in leadership positions. 

Often now we are inundated with data and analysis of every little activity. 

While data is important and I believe that what improves is what gets measured. 

It is equally important to understand life is not dashboards or data points on a graph. It is more complex than spreadsheets. 

This is the mental model concept of a map not being the terrain. 

If we were to think about a map. What is a map? It is a 2D representation of the actual 3D reality. 

A road map of the interstate highway system in the United States is a representation of the highway system, but it is not to scale. It does not fully represent reality. 

A map is a model. 

It is a model that does not always represent things like elevation or weather or traffic all of which could and will be encountered on a journey cross country that would not be conveyed on a map. 

This is a useful mental model because so much of life around us is only presented in a surface level aspect and we need to understand this concept so we can peel back the layers to the underneath. 

I call this Dashboard Management. 

Dashboard management is a concept in which numbers and metrics tell you the whole story. It is very easy for a CEO to look at sales numbers or website clicks and conclude all is well, but maps are not the terrain. 

It is easy to stand on a scale and conclude you are healthy or unhealthy based on a single number. The map is not the terrain. 

The map is not the terrain. Regardless of how detailed the map is it will never be to scale of the territory. 

So much of our social media world today is a map representing the territory. 

The perfect angles, the great lighting, the only showing the exciting moments. Even Instagram influencers posting on fake private jets. 

Even the most detailed maps. Think Google Earth. They are still not perfect. They do not contain the noise of traffic, or the smell of a pizza parlor, the feel of a cool summer night. So even highly detailed maps are still just unrealistic representations of reality. 

Just like maps model terrain the mind models reality. 

OKRs : How to design your work day

OKRs or Objectives and Key Results is a methodology to set goals and assign metrics to achieve them.