Let It Rip

For some time, there’s been the idea that the economy, like biology, is a complex, evolutionary system.

Put differently:

A business plan will be replicated by an owner if it resonates with consumers’ tastes and preferences … which is similar to how a gene behaves if victorious.

And while outcomes within an evolutionary system can’t be predicted, The Origin of Wealth argues that we can at least identify three conditions that must be met for the evolutionary process — and the creation of economic value — to occur:

1) Make irreversible decisions, i.e. you can’t make a (t)omelet without breaking some (gr)eggs

2) Create order at the local level, e.g. you organize raw materials to produce t-shirts … and thus create some order (even though the broader t-shirt market may be thrown into chaos when you start competing with others)

3) Achieve “fit order”, i.e. people, driven by their needs/preferences, deem something of value … thus there’s a fit! … which then inspires business owners to repeat their successful business plans until the market tells them otherwise

So, to recap on how to generate economic value:

Take action that costs something. Make things. And achieve product-market fit.

Beinhocker goes on to outline actions that companies can take to increase their odds of achieving “fit order” (#3) — and I may spend a subsequent post or two articulating what I find most interesting about his analysis.

But first, I want to comment on “making irreversible decisions”.

We all know that to grow, we gotta make decisions that throw us into discomfort.

And an irreversible decision means taking a risk that could carry a (potentially painful) price.

Most the time, that pain is minimal — such as getting ignored by a stranger, or burning a little cash to test out an idea, or sharing your thoughts online.

It seems that the cost of not making an irreversible decision is often much higher than making it, and we humans aren’t great at implementing this realization.

To take this thought in a weird direction —

For some time, I’ve struggled with my two-handed tennis backhand.

Because there’s less room for sloppy footwork, it’s easier than the forehand to screw up. And as I stopped swinging through properly … the bad shots started a’comin’.

So, I’ve been practicing on the wall at Bobby Jones. And I noticed that each time I begin a session, if I start hitting one-handed backhands — which historically I haven’t done while playing with someone — I’m able to rip ‘em cleanly and with force. Then, after a few reps, I add my second hand and continue my assault on the wall.

It makes sense — if I’m not swinging through with intention using one hand, the ball ain’t going anywhere. The one-handed backhand trains my brain to commit. But with two hands, it’s almost like each hand thinks the other will do the work … and then together they fail.

Our brains are primed to act like the one-handed backhand … ready to rip after recognizing opportunities that excite us.

But when it comes to potential pain, we’re sooo quick to bring in that second hand to try to protect ourselves (and hold ourselves back).

“Do the thing later”, it implores. AKA the Resistance.

It’s easy to love a good list and a malleable plan, but those must be used in tandem with a propensity to make lots of irreversible decisions.

As Jon Bernthal’s character in ‘The Bear’ so eloquently professes: