Pistachios, Six Flags, and Assumptions
My daughter and I were getting set to make the 90 minute drive home from St. Louis after one of her soccer games when we decided to stop at a convenience store to get a road snack. She picked out chips and I, trying to be slightly healthier, grabbed pistachios. We got back in the car and on the road and it was then that I noticed my mistake: the pistachios weren’t shelled. Since there’s no way to shell pistachios and drive (responsibly) on the interstate simultaneously, my road snack was worthless.
“I was wondering how you thought you were going to do that,” she smiled.
Thankfully she shelled my pistachios for me after she finished her chips, so all was not lost.
Now this is admittedly smaller stakes stuff (though never underestimate h-anger), but it’s illustrative of the fact that game-changing mistakes can be made when you take small things for granted (leaving aside what me assuming all pistachios are shelled says about my own moral degradation).
Here’s a related example…
Mark (our COO) told me about a time when he was a kid and visited Six Flags with his family. When they arrived, the computers were down, so the park couldn’t accept credit cards. Thankfully, Mark’s dad Paul is old school and carries cash. He was able to pay for everyone’s tickets out of pocket even as those trying to pay with plastic were out of luck, so the family got to enjoy the park crowd-free for a few hours until the computers came back online.
That’s not an example of how taking something for granted led to a mistake, but rather of how not taking something for granted can create a massive advantage if everyone else takes it for granted. No one except Mark’s dad Paul thought they might need cash at Six Flags and 99.9% of the time you don’t. But the 0.1% of the time you do, well, that’s World’s Best Dad stuff.
So a very interesting question to ask is “What do I take for granted and what might it look like if I didn’t?”
Back when I worked in public equities I took it for granted that given the liquidity of public markets, I would always be able to buy and sell investments. Now that I don’t, my behavior as an investor is different, particularly when it comes to underwriting risk and spending time on relationship building and origination. This is not to say that Current Me would have done Past Me’s job better, but rather that Past Me might have benefited from thinking a little bit more like Current Me on this topic.
Businesses can take things for granted as well, such as employees staying healthy, customers abiding by payment terms, and so on. Yet the real world inevitably intervenes. Now, in order to be efficient it’s not necessarily to always be examining all of your underlying assumptions, but it is worthwhile to list them from time to time and ask what you might do differently if you didn’t take them for granted.
– By Tim Hanson
