Q: What is a "little bet"?
A: A little bet is a low-risk action taken to discover, develop, and test an idea. So, for instance, Chris Rock develops new comedy routines by making little bets with small audiences, while Amazon’s CEO Jeff Bezos makes small bets to identify opportunities in new markets. Little bets are at the center of an approach to get to the right idea described in the book that any of us can learn without getting stymied by perfectionism, risk-aversion, or excessive planning.
Q: How is this approach different from and better than the typical way most people do something new?
A: We’re taught from an early age to use certain procedures and rules to analyze and solve problems, such as for math or chemistry. We’re asked, what’s the correct answer, right? There’s an emphasis on minimizing errors. These types of skills serve us extremely well, especially when we have enough information to put into a formula or plan. But what happens when we don’t even know what problems we’re trying to solve? It happens a lot. That’s the situation the U.S. Army has had to face when confronting Middle Eastern insurgents. In situations like these, engaging in discovery and making little bets is a way to complement more linear, procedural thinking.
Q: What research did you do for this book and what did you set out to discover?
A: I wanted to find out what went on behind the scenes of some of the great achievements and innovations we witness. Most of them weren’t the epiphanies of geniuses, but instead the result of masters of a specific type of experimentation. To find out the common elements of their experimental approach, I reviewed empirical and neuroscience research about creativity and innovation, and interviewed or observed dozens of people about their approach, including Army counterinsurgency strategists, architect Frank Gehry, agile software development teams, stand-up comedians, entrepreneurs who had self-financed billion dollar businesses, the rapidly growing field of design thinking, and musicians like John Legend, as well as executives inside a range of organizations such as Amazon, Pixar, Procter & Gamble, Google, 3M, General Motors, and Hewlett Packard.
Q: What about big bets? Why do you focus on little bets?
A: We all want to make big bets. That’s a Silicon Valley mantra. Be bold. Go big. But I think ingenious ideas are over-rated and that people routinely bet big on ideas that aren’t solving the right problems. Just as Pixar storytellers must make thousands of little bets to develop a movie script, Hewlett Packard cofounder Bill Hewlett said HP needed to make 100 small bets on products to identify six that could be breakthroughs. So, little bets are for learning about problems and opportunities while big bets are for capitalizing upon them.
Q:Why is it more important than ever to master a "little bets" approach?
A: We live in especially uncertain and rapidly changing, yet risk-averse times that make it easy to get stuck. Little bets provide an antidote. Take Twitter. It originated out of little bets made inside Odeo, a podcasting company that was going nowhere. After asking employees for suggestions about what the company should do, Odeo founder Evan Williams gave Jack Dorsey two weeks to develop a prototype for his short messaging idea. Twitter was soon born. The same is true for all of us. Unlike previous generations, people now change jobs every few years and, according to researchers, will even switch careers up to six or seven times over a lifetime. That’s a very different world than previous generations. Little bets must become a way to see what’s around the next corner, lest we stagnate.
Q: What surprised you most in what you found?
A: One of the things that constantly surprised me was how many similar approaches and methods spanned across the vastly different fields. Story developers at Pixar, Army General H.R. McMaster, a counterinsurgency expert, and Frank Gehry use the same basic methods and of course make lots of little bets. They even use similar language and vocabulary – like "using constraints" or "reframing problems"– but they all learned their approaches through their experiences, not in school. General McMaster may have said it best when he said that the parallels between these very different experts were "eerie."
Q: What companies are best at little bets?
A: Amazon, Pixar, Apple, and to a lesser extent Toyota, 3M, and Google have little bets infused into their cultural DNA. Steve Jobs has evangelized about the benefits of the approach described in Little Bets more than any other CEO, while little bets are a way of life at Amazon, whether the company is expanding into new markets or improving internal processes. And, I wrote a lot about Pixar because it’s the closest thing to a constant learning organization using little bets around today. But any company or team can make use of little bets. Procter & Gamble is an example of a more risk-averse organization that is working to build a culture of little bets.
Q:What’s the first step any of us can start taking tomorrow to start benefitting from a little bets approach?
A: Commit to making a little bet. It doesn’t matter on what. Look for interesting problems and work toward larger aspirations. Maybe it’s going to be a presentation about starting a new nonprofit. Or maybe it’s trying a different approach for a work meeting. Once you get into the habit of making little bets, they can constantly open up new possibilities that just might lead to something big.