Hello, you've reached my Business Bliki (blog meets wiki kinda). In 2004 I co-founded a multi million dollar company, and then went on to start my very own. Bixly is where my time is spent right now. It's multi-locale software shop based in Fresno California. Also, it's been doubling every year in this down economy. I hope some of the writings you find will help your organization do the same.

I prefer to learn from books really, and kept things short and juicy for folks that are share my preference. I don't want to take all your time with these interweb-articles, but rather help promote great ideas and practices that require further study. More importantly, it's a way for all those who work with me to understand what the heck I am thinking.

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Ambiguity Aversion

I have seriously said "Ambiguity Aversion" so many times when standing up for the Bixly brand, or when designing some type of product.  This concept is foundational to creating and maintaining a clear path in your customers and employees minds, towards awesome. I think this term should invade every area of your organization, like it has mine.

Research has shown that we certainly possess risk aversion. Ambiguity aversion should be considered its hidden twin in the proliferate duo that is worth understanding for your business. An awareness of this principle is certainly important enough to add to my Basic Tenets.

Ambiguity Aversion is our tendancy to make a decision that is simplest to understand, rather than logically the smartest. See, you can have a two or more choices in front of you with greater/lesser/equal worth. You will most likely choose the one which requires the smallest amount of thinking. The one that needs no further probing to understand what you are in for.  Please check out the Thirteen.org video that inspired this post. What a neat show! Further:

Frisch and Baron (1988) emphasized that the subjective experience of missing information relevant to a prediction may lead to ambiguity aversion.
Keller

This has so many implications for business and brands. A great example of popular usage and profit from Ambiguity Aversion is the show Deal Or No Deal . Forward to the middle of a show and the decision usually looks like this: Take $300,000 right now, or possibly get $800,000. It’s silly really to choose the $800,000 because the chances are still 1 in 5 or 1 in 10. Since we are averse to ambiguity, it’s easier to calculate “hmmm, I want more money, and this could work”.

This opens up a whole new field of Neuroeconomics to us, which is definitively worth further brain breaching...at some point.

Interestingly, ambiguity aversion in pairs of users actually gets worse!

The majority of the dyads exhibited a cautious shift in the face of ambiguity, stating a smaller willingness-to-pay than the two individuals’ average. Our study thus confirms the persistence of ambiguity aversion in a group setting and demonstrates the predominance of cautious shifts for dyads.
Keller

Have you every read about the Jam Study (Iyengar and Lepper)? They set out Jams in a Menlo Park grocery story. On table had 24 types of jam, while the other had 6. While a bit less people stopped at the table with 6 brands, that smaller selection yielded a TUN more sales. 6x the sales of the other, larger selection table. This is why Fresh And Easy is doing so well. They only have one to three brand options, usually, for any given item.  And, that's right on. I simply don't need 6 types of yellow mustard to choose from.  

So, it's not some hard and fast and always true rule. But the point is that so many business owners just ignore it. Bixly does one thing: Django programming. It's been one of the determining factors of our success, and allows customers to relax, make one simple decision, and move on. 

 

An Alternative To Power

 Power is one of those things that generally annoys me. People use that to move about and change things. It hampers my personal freedom, so someone else can have it. All for the "greater good" they would say. 

It's almost silly to ask, but has a manager or boss ever rubbed you the wrong way? Maybe you worked with your siblings, or parents even, and the same thing happened. What about your spouse? Have they ever demanded something from you that you didn't want to give? This discomfort, this ego trip wire is the result of people having power over you, and using it to direct you.  

Power unravels our self control when we are on the receiving end of it's blunt use, because somewhere in our minds we believe that:

It is easier to find people fit to govern themselves than people to govern others.  Every man is the best, the most responsible, judge of his own advantage.  -Lord Acton

What if there was another option? What if we could avoid using power in a way that turns off everyone around us? This is possible through conviction rather than power. Imagine, rather then giving a stern lecture, you lit the imagination, and inspired action rather than forced it.  It's what we wished our first bosses would have done, and what we ourselves can start doing now, to avoid becoming them. 

Once again, I have to change everything I thought about management. Great thinkers, like Acton, can be such a burden sometimes!

 

Ownership

 Ownership is so interesting. It's something we think very little of philisophically, but so much about practically.  Gaining something, mastering something, perfecting something, improving something, even yourself; that's what we are doing all day. If not, you might be dead. 

My childhood was so fond, thankfully. I did have parents that had very generous views of property. What was theirs, was ours. In one way, it was generous. In other way, it wasn't ideal, possibly for them, possibly for both of us..probably just for them.  I think about my Dad's toolbox. It was almost non existant, and not because he was completely useless with it, but because it was all of ours. If you wanted the crescent wrench, it was best to look in the "skinny droor", root around the garage, or maybe even look through the grass in the backyard. 

Here's the weakness we encountered as a family: The curse of the commons. We didn't have any tools really.  When everyone owns it, no one owns it. Even things as simple as tools are more interesting to me now, because of ownership, and especially after reading Boundaries Of Order. There is so much history that proves the curse also, that I will link at some point.

I have become, in fact, adamant about ownership. In my company and at home, I am pushing for everyone to own something, and for everything to be owned, to avoid the curse of the commons. Really, I have a plan to change the world(who doesn't, right?), but that will come later. To shed some light on the subject of ownership and boundaries, here are some of my notes from the most excellent book:

So insensitive have we become to the role of property as the most important civilizing influence in our world, that we have even learned to regard the infliction of our wills upon the lives and property of others as expressions of "socially responsible" conduct 

As we shall discover, individual liberty and self-ownership are synonymous terms; we are free only insofar as we insist upon the exclusive authority to direct our own energies and other resources 

As we shall discover in subsequent chapters, conflict is likely to emerge whenever ownership is divided from control. In the case of a business firm, a manager may have purposes of his own that differ from those of an owner. 

"That dog is mine," said those poor children; "that place in the sun is mine." —Blaise Pascal 

Boundaries are the means by which liberty and peaceful order become integrated in society. As the saying "good fences make good neighbors" 

That's really just a taste from that book. It got me thinking about how boundaries, ownership and freedom are things hugely important issues in my life, but I don't have clear mental models for all of them just yet. I can tell you that I believe ownership beats commons, strong fences do generally make great neighbors, and personal freedom is something we all need and want. It's been so interesting applying those beliefs to my life and my company. I can tell you there is so much more to come, because, if I, as a child, had purchase my very own crescent wrench, I know for a fact it wouldn't have ended up lost in the grass.

 

Cure for Analysis Paralysis

It’s one thing to say “go big or go home”. That’s very different from doing it. Going big can mean many things, and they are generally all uncomfortable and perplexing. “Analysis Paralysis” comes to mind. See, the fighting instinct, the gamer, the world changer in us says to go big. And why not? Nothing important EVER happens without big moves.

I believe there two things you can do to effectively combat analysis paralysis.

First....

 Understand the thing that is holding you back is human, and simple. It’s our overwhelming tendancy to weigh cons heavier than pros. In other words, we have an innate proclivity towards seeing potential losses worse then they really are. For example, studies have shown that the same opportunity presented in two different ways-one emphasizing the risks, the other the gains-are not seen as equals. That's called Negativity Bias. Crazy! But we all fall prey.

Take this quiz as an example: 

Would you rather save $5 on this purchase, or avoid a $5 charge?

Ovoid the $5 charge right? In reality, it just doesn't matter. One seems worse than the other, but they are exactly equal. See, the Negative Bias?Loss Aversion studies show us that we all value avoidance of loss over the value of gain. That means we would be more satisfied avoiding a $5 charge, than finding $5 in our back pocket. 

If you have objectively weighed both sides, pros and cons, sought council, found no valid contradictions, know everything adds up to your favor and STILL haven’t made the big move, this is why. You are doing something quite natural: surviving safely. Acknowledge and correct this human tendency and you can cure your analysis paralysis.

Second....

You gotta get a little less scientific for this one. I realized that a certain emotional state would allow me to overcome almost all the negative spin I naturally put on things, and look solely at the positive, and really feel connected with the outcome it could produce. It's a state of dropping everything trivial, and looking at the big picture with such positive light that forward movement becomes natural, and necessary, and perfect.  I know of two ways to get into this state:

  • Undergo dental work...or more preferably
  • Become well liquored

Every time I enter one of these states, second guesses are gone. I have already done the second guessing, I understand what could go wrong and can deal with it. But when I am here, I just don't care. The path ahead is so clear and obvious, I simply make a decision to move forward. 

Two Buck Chuck and a little understanding about our brains....works like a charm!

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