There Is No Medium Effort
One thing that I believe to be true about finance is that there is no medium risk. This is the idea that if you take any investment risk at all, what you are risking capital on can always go to zero, so you should either keep your money in safe assets or seek high returns that compensate you for taking risk. It’s anathema to the way a lot of asset pricing is structured, but I believe it to be true and conduct ourselves accordingly. For example, if you looked at Permanent Equity’s balance sheet you would see cash and illiquid long-dated investments.
I also spend a lot of time thinking about where else this barbell approach might apply.
That topic came up the other day when I was talking to someone who expressed frustration about certain tasks, like writing update emails, taking too long and therefore causing him to shortchange other meaningful tasks where he thought he should be spending more time. After talking it through we landed on a challenge: that he no longer spends 45 minutes on anything. Rather, he should divide his priorities into items that should take 5 minutes or less and others on which he wanted to spend a half day or more. In other words, there is no medium effort. Either do it fast or do it.
A seminal book that I read early in my career was Getting Things Done by David Allen. It’s full of lots of tips and tricks, but one that I’ve abided by ever since I read it is that if something comes across your desk that you can do in 5 minutes or less, do it right then and there. That approach has been a life-changer for me and is the reason why if you send me a short email, you’re likely to get a response in 5 minutes or less (please don’t all try that at once).
But as I was thinking about the challenge I talked through with my colleague, I wondered if it applied to me as well, but in the other direction. I, too, take 45 minutes to do a lot of things, but maybe these are things I should be spending more time on. Even if something seems settled, if it’s important enough, is it worth revisiting a few times over?
Suffice to say, I’m going to try it and see what happens. My productivity may suffer, but maybe that will be worth it if my product levels up.
– By Tim Hanson