As a teenager, I continuously made really bad short term decisions that ended up hurting me in the long term. Often I would tell a lie, that would need to be compounded by an additional lie, which would end up being multiply compounded by a web of lies in order to get away with something that my mom would ultimately uncover anyway. I knew she would uncover it, but the game was all about seeing how long I could keep up the façade to get away with it. The problem with delaying the consequences, though, was that my compounded lies usually ended up making the punishment worse and getting me in trouble with more people than just my mom. In my 20's I started my own company. It had oodles of potential and, right out of the gate, I had lots of client work and overall interest. I was so excited about it, I started borrowing on 'potential' (rather than actual) earnings. I charged up credit cards, took out business loans (I didn't need) and went in deep into debt. Two years later, I made an equally risky move. Deep in debt, but chugging along, I moved to another (bigger) city to set up shop there. No reputation and a turn in the economy made this move a tough one and, all of a sudden, I couldn't handle the debt that I accrued. I had to table my company and take a corporate job in order to just stay afloat. In a series of rash, short term thought-out moves, I wrecked that potential.
Of course, years later, I was able to give it a go again. In my 30's with more experience and a better grasp on actions and consequences, I now understand that risk is necessary, but not ALL risk is necessary. There are two general types of risk from my experience:
- Risks that you take because you believe in something and that are essential to getting to your end goals. And;
- Risks that you take because you are taking shortcuts to gratification.
When I ran Rogue Strategies (previous company), I wanted to look like a big company, so I spent money on stuff that made me look like a big company (without me being a big company). That stuff costs lots of money (because actual big companies buy it). My actual goals that I had and believed in were to shake up the world of marketing by creating customer-centric, grassroots type marketing plans that were light on the media buys and heavy on the interaction. Yet....here I was buying the media for myself (ads, fancy brochures, etc.). Instead of putting my energy into slowly building a reputation through well-executed campaigns that proved my theories that would lead to more work, I created the façade of success to bring in new work.
Funny thing was that I still received 95% of my clients through word of mouth. I was being impulsive, egotistical and thinking in the short term. Because of that, when things got tough, I caved.
Risks we take now? Holding strong to our beliefs and slowly building a good repertoire of success stories. After just over a year in business, we still have a long way to go in 'proving' anything, but because we've used the same grassroots approach to building our own business (which has been successfully busy from day 1 without going into any debt), we are walking the walk. There are no shortcuts to gratification here and, in fact, some days are really hard. Like when we meet someone from the marketing world who asks, "So, what big clients have you worked on?" I am instantly thrown into the picture where I am standing about a million miles away from my goal (not that the goal is working with big clients, but that our current clients will have widely known success because of their commitment to community).
But having experienced this before and being a few years older than I was the first time, I know that reaching those goals organically and through perseverance, even if it takes 25 years, will taste way sweeter than trying to create the façade and taking shortcuts that will buy them today. And the best part is that it will endure. Companies who plan for their long-term goals will be along much longer than those who only think in short-term gratification.
When I think of these companies, Apple and Google come to mind. It seems to me now as I watch them roll out products that only companies in their position could, they knew years ago where they were going and the long term pains they would have to suffer to get there. Google's various properties, Docs, Maps, Mail, etc. came after they dominated the search market (yet, many companies are struggling to find business models to amass data FAST to make themselves more useful). Apple served a niche market for years while growing their design reputation bit by bit until they could get away with launching incredibly innovative user interfaces that would be massively adopted. (it is a myth that people like innovation. Change is not often greeted with open arms. The click wheel produced by an unknown company with no design reputation would have probably been looked at with great puzzlement)
I believe the biggest risk is the one of believing in something that is not part of conventional wisdom and then pursuing the proof of that belief over a longer term. The risk is that maybe you are wrong. Maybe you've worked for 20 years and find out your hunch was way off. But I see this outcome as a different kind of success. You've reached your goal, it just doesn't look like you imagined it to. And the consequences? Well, you've ruled out one possibility, so that leaves you with great knowledge to pass along to others. And knowledge of what NOT to do (and why) is very valuable.
The reason that I'm waxing this now is I am watching my teenage son embark on the same journey I did twenty years ago. I have full knowledge of what NOT to do and I also have a bit of knowledge about what he should do. Of course, anyone who has teenagers or who remembers being a teenager will also know that this type of knowledge coming from a parent doesn't warrant the same impact as if it came from a peer. But my son's peers, it seems, are pretty big on the short-term gratification thing themselves.
Therefore, it's my job to take actions that may hurt him (and me) in the short term, like grounding or making similarly unpopular decisions (which are really hard to make) to make sure he prevails in the long-term. When he makes bad short-term decisions (like skipping class and failing to turn in homework), I need to teach him that there are immediate consequences (being grounded) before he has to face the real-life long-term ones (having to repeat a grade or not getting into college, which could lead to a lower earning potential). I won't have the ability to shade him from the worse consequences forever, though, so I have to be firm today.
Don't you wish you could do the same for your favorite companies who you watch making short-sighted decisions?