Back in 2006, I wrote an article about The Personal MBA, a project that helps you study business on your own without taking an expensive MBA program. Recently, Josh Kaufman – the founder of The Personal MBA – contacted me about his upcoming book and sent me an advance copy.
The title of the book is The Personal MBA: Master the Art of Business and it aims to give you the fundamental principles of business that you can apply. In the author’s words:
Think of this book as a filter. Instead of trying to absorb all of the business information that’s out there – and there’s a lot out there – use this book to help you learn what matters most, so you can focus on what’s actually important: making things happen.
Interesting, isn’t it? I don’t have time to read many books, so having someone else do it for me and give me only the key lessons is definitely something I’m interested in.
Even better, the book contains not just pure business concepts but also concepts on personal effectiveness. Why? Because the author believes that you can only run your business well if you are also effective as a person.
In this post I’d focus on the personal effectiveness side of the book. Please read the book yourself for the business side. There are many personal effectiveness lessons in the book, but here are thirteen that I like the most (with additional explanations from me):
1. Build mental models
To make good decisions, you need to understand how the system works. For that, you need to know the relevant mental models. Reading books, studying the best people in your field, and getting experiences in the real world can help you build those models.
Don’t try to be perfect the first time you do something. That will only lead you to failure. Instead, aim to build the first working version of what you do as soon as possible. Then get feedback on it, refine it, and repeat.
3. Create alternatives
The more alternatives you have, the stronger your bargaining power becomes. Having a strong bargaining power is important to have a good career. You can create alternatives by getting offers from several companies or having your own businesses. If you don’t have any alternative, you’ll have to accept whatever offer you get no matter how bad it is.
4. Focus on delivering more value
Whether you work for a company or work on your own, you need to compete with other people. But instead of focusing on the competition, focus on delivering more value. Do that and the competition will take care of itself.
5. Beware of opportunity costs
Whenever you make a decision, be aware of the opportunity costs involved. Taking one option over the others means you miss the opportunity to take the other options. So make sure that the value you get is bigger than the opportunity costs.
6. Beware of diminishing returns
Even if you make the best decisions, you still need to be aware of diminishing returns. Something that gives you good return in the beginning may give you less and less return as time goes by. At one point, the return you get would be less than the resources you put in so you should stop.
7. Beware of sunk costs
A common pitfall many people fall into is to stick with their decision though it obviously doesn’t work. They think that because they’ve invested a lot of money and time into something, they shouldn’t leave it. That’s a wrong decision that could cost you a lot. What you have invested are sunk costs and can’t be recovered. If something obviously doesn’t work, leave it rather than wasting more resources on it.
8. Break your psychological barriers
In the past, people believed that human can never run a mile in under four minutes. But once Roger Bannister proved otherwise in 1954, sixteen runners did it in just three years. What happened here? Roger Bannister’s achievement broke the psychological barrier about what is possible.
You need to do the same with yourself. What limitations have you put in place? Reading about other people’s achievements can help you break these barriers.
9. Do personal R&D
You need to constantly improve yourself. For that reason, you should allocate money for your personal research and development. You can use the money to buy books, attend conferences, and do other things that improve yourself.
10. Create checklists
If you do something frequently and want to make sure that you do it correctly every time, use a checklist. Document every step to complete the task. It might take some time to create, but you can be sure that you won’t miss anything the next time you do the task.
One way to increase your productivity is delegation. Perhaps other people can’t do it as good as you, but if it’s still good enough then delegation is something you should consider. Delegation is also good for tasks that are routine and those that someone else can do better than you.
12. Create a supportive environment
When you want to change a habit, don’t try to change the habit directly. Your willpower is limited and trying to change the habit directly will quickly deplete your reserve of willpower. Instead, use your willpower to change your environment so that it supports the new habit. In a supportive environment, it will be much easier for you to install the new habit.
13. Test and experiment
When are you most productive? In what kind of environment are you most productive? Answering these questions requires you to test different things in order to find the best combination.
You can do this with practically every aspect of your life. Whenever you want to improve yourself in a certain area, do testing and experiments there to find what works best for you.
Have you tried these techniques? Feel free to share your experience in the comments.
Photo by Sean McGrath