{"id":6870,"date":"2017-05-30T09:21:06","date_gmt":"2017-05-30T16:21:06","guid":{"rendered":"https:\/\/www.scotthyoung.com\/blog\/?p=6870"},"modified":"2019-03-08T04:01:50","modified_gmt":"2019-03-08T12:01:50","slug":"multiply-or-add","status":"publish","type":"post","link":"https:\/\/www.scotthyoung.com\/blog\/2017\/05\/30\/multiply-or-add\/","title":{"rendered":"Multiply or Add?"},"content":{"rendered":"<p>One of the most influential essays for me in starting a business, was <a href=\"https:\/\/www.sodaware.net\/dev\/articles\/shareware-amateurs-vs-shareware-professionals\/\">this early article<\/a> by Steve Pavlina. In the essay, he argues that building a successful company comes from a combination of factors (product quality, market demand, sales copy, etc.):<\/p>\n<blockquote><p>\u201cAnd let\u2019s say that for each factor there is a range of effectiveness from 0% to 100%.<\/p>\n<p><strong>Understand this: these factors don\u2019t add \u2014 they multiply!<\/strong> If all of your critical factors are at 100%, but just one is at 0%, that means you could be getting zero sales, even though you did most things perfectly. For instance, you could have a truly brilliant product, but if people don\u2019t feel secure using your order form, that single flaw could cost you most of your potential sales.\u201d [emphasis in original]<\/p><\/blockquote>\n<p>This multiplicative model is obviously a simplification of how a business works. However, it is also a powerful idea because it shows how small improvements could add up and why doing a bunch of things well, but not great, could still lead to lousy results.<\/p>\n<p><a href=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-13.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-large wp-image-6886\" src=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-13-1024x576.jpg\" alt=\"\" width=\"1024\" height=\"576\" srcset=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-13-1024x576.jpg 1024w, https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-13-300x169.jpg 300w, https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-13-768x432.jpg 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a><\/p>\n<p>With my own business, for instance, there are several factors which clearly multiply. To make revenue from this blog, I need to have traffic, conversion of traffic to readers, a product which addresses a problem people have and belief from readers that I can actually help with said problem.<\/p>\n<p>If any of these factors do poorly, the business as a whole does poorly. Many people I know in this industry suffer because one or more of their links in the chain is weak. I have some friends with a great pitch and product, but they don\u2019t have traffic so they have no business. I have other friends with lots of readers, but their product isn\u2019t compelling enough and they struggle with money.<\/p>\n<p>It took me around seven years to get all the pieces working sufficiently to earn a living. Even a doubled improvement of one factor (no small feat) doesn\u2019t add up to much when the total is low. Two multiplied by $100 is only $200.<\/p>\n<p>Yet, when you get the factors working together, improvements have a much larger base to build upon. Two multiplied by a million dollars is two million dollars.<\/p>\n<h2>When Do Things Multiply? When Do They Add?<\/h2>\n<p>Although building a business is a salient example of multiplicative factors, there are many other situations where this can happen.<\/p>\n<p>Complex skills like painting or chess have key factors that multiply. Painters must know color mixing, drafting, composition and brushwork. Chess players must know openings, endings, strategy and tactics. A deficiency in any factor can be the difference between amateur and professional.<\/p>\n<p>However, many other factors don\u2019t multiply\u2014they add. These factors are great to have, but they also don\u2019t mean doom if they\u2019re missing. Each word learned in a new language, for instance, has a roughly additive effect on your speaking ability, proportional to its frequency. More useful words add more, but rarely do they completely undermine your ability to speak the language.<\/p>\n<h2>Filters or Pipes?<\/h2>\n<p>A good rule of thumb for identifying likely-to-be-multiplying factors is that they often form filters in a serial process:<\/p>\n<p><a href=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-11.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-large wp-image-6884\" src=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-11-1024x388.jpg\" alt=\"\" width=\"1024\" height=\"388\" srcset=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-11-1024x388.jpg 1024w, https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-11-300x114.jpg 300w, https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-11-768x291.jpg 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a><\/p>\n<p>If the efficiency of any stage of the filter is zero, nothing passes through. An online business has many filter-like stages: traffic, subscribers, customers, referrals, and so on. A chess match proceeds from opening to middle game to end game.<\/p>\n<p>Additive factors instead work like parallel pipes:<\/p>\n<p><a href=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-12.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-large wp-image-6885\" src=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-12-1024x344.jpg\" alt=\"\" width=\"1024\" height=\"344\" srcset=\"https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-12-1024x344.jpg 1024w, https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-12-300x101.jpg 300w, https:\/\/www.scotthyoung.com\/blog\/wp-content\/uploads\/2017\/05\/M1-12-768x258.jpg 768w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a><\/p>\n<p>More additive processes will increase your total effectiveness, but their absence won\u2019t kill it either. Each new word you learn in a language, increases your overall fluency, but any individual missing word doesn\u2019t completely obstruct it.<\/p>\n<p>Most domains of success have both additive and multiplicative factors. The approach you take with each needs to be radically different.<\/p>\n<h2>Multiply: Patience and Perfectionism<\/h2>\n<p>With factors that multiply, the focus needs to be on fixing weaknesses. If a pursuit has ten multiplying factors and any of them are at zero, then it doesn\u2019t matter how good the others are, anything times zero is zero.<\/p>\n<p>This results in an attitude favoring perfectionism. Manufacturing often works on a multiplicative model (any defect will ruin a product). This has resulted in the widespread adoption of perfectionist manufacturing philosophies of <a href=\"https:\/\/en.wikipedia.org\/wiki\/Six_Sigma\">Six Sigma<\/a> and <a href=\"https:\/\/en.wikipedia.org\/wiki\/Kanban\">Kanban<\/a>. When you have dozens of serial steps that all must be done correctly, you better not have a step that is done poorly.<\/p>\n<p>More multiplying factors also signals a need for patience. This is because improvements are initially constrained by all the other weak stages in the process. You may spend hundreds of hours improving your end game in chess, only to get trounced because you messed up the opening.<\/p>\n<h2>Add: Strategy and Specialization<\/h2>\n<p>With factors that add, the focus should be on building strengths. Because an additive weakness doesn\u2019t have a negative impact on your performance, you should instead try to cultivate key strengths.<\/p>\n<p>Adding factors should also be done strategically. Sometimes a particular combination of factors will work well together, allowing you to ignore many of the possibilities. I chose to focus on a narrow set of topics in learning and productivity for my blog, rather than physics or art. I don\u2019t need to be an expert on those topics because I don\u2019t write about them.<\/p>\n<p>With additive factors, it\u2019s better to be the hedgehog, who knows one thing well, than the fox, with partial knowledge of many things. The same advice applied to multiplying factors, however, would be disastrous.<\/p>\n<h2>Which is Which?<\/h2>\n<p>Figuring out whether a factor is a multiplying or additive factor is tricky. This isn\u2019t only because the mathematical relationships with success are difficult to tease out of reality, but because factors themselves are rarely purely multiplicative or additive.<\/p>\n<p>In writing a blog, is social media an additive or multiplicative factor? Clearly it can\u2019t be purely multiplying, because many successful blogs have no social media presence at all. But that also doesn\u2019t quite fit the data because, for other blogs, it is the dominant source of traffic.<\/p>\n<p>The answer is somewhere in-between. Social media can be a multiplying factor, if you\u2019ve made the set of choices that place it in the center of your traffic funnel. If you haven\u2019t, then it\u2019s probably more like an additive factor. Confused yet?<\/p>\n<p>The important thing to remember is that multiplying versus adding is a model which will fit a lot of data, but there will always be tricky categories that are somewhere in between, or act like one or the other depending on the other sets of decisions you\u2019ve made.<\/p>\n<blockquote><p>Try it yourself. Ask yourself what factors contribute to a goal you\u2019re working on. Now, ask whether each is a multiplying or additive factor. Share your thinking in the discussion below!<\/p><\/blockquote>\n","protected":false},"excerpt":{"rendered":"<p>One of the most influential essays for me in starting a business, was this early article by Steve Pavlina. In the essay, he argues that building a successful company comes from a combination of factors (product quality, market demand, sales copy, etc.): \u201cAnd let\u2019s say that for each factor there is a range of effectiveness [&hellip;]<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":"","_links_to":"","_links_to_target":""},"categories":[683,3],"tags":[],"class_list":{"0":"post-6870","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-nc-career","7":"category-personal-development","8":"entry"},"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Multiply or Add? - Scott H Young<\/title>\n<meta name=\"description\" content=\"Sometimes things multiply instead of adding. 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