Hello friends, and welcome to this edition of The 20 Percent.
This week’s breakthrough idea is from Peter Thiel’s Zero to One.
Making small changes to things that already exist might lead you to a local maximum, but it won’t help you find the global maximum.
You could build the best version of an app that lets people order toilet paper from their iPhone. But iteration without a bold plan won’t take you from 0 to 1.
Thiel believes that we live in a society of deep conformism and constrained imagination. So much, in fact, that bold thinking and execution have become breakthrough ideas.
A Bad Plan Is Better Than No Plan at All
According to the mathematical definition, a local maximum is a maximum within some neighborhood that need not be (but may be) a global maximum.
In other words, from our viewpoint, we can never know if we’ve achieved our true potential. We have to make a leap of faith, build a bold plan and take action.
A good plan is better than a bad one, but any plan is better than no plan at all. Think of this mathematical curve as your plan. To reach a higher vantage point, you have to follow it through its ups and downs.
Local Maxima Are Overvalued
Let’s take a photography studio as an example (inspired by a client story). After a few years in business, it’s possible to rank high enough on Google – especially in your region.
You can be one of the top results for “photography studio” or “professional photographer”, which is good for business. But what about your commercial work? Or stock photography licensing? Or industrial photography projects?
Eventually, you reach a point where the local maximum is no longer enough. You have to restructure your website and set up a strategy that gives you space to grow.
Creating Your Opportunity Space
Because local and global maxima are defined by their area, it’s important to think long-term. When we become laser-focused on the present, we unnecessarily compete for a small range of possibilities.
In website marketing, 80% of the outcomes (rankings, traffic, etc.) usually come from just 20% of a website’s pages. If you stay confined to a small opportunity space, this 20% won’t be enough for long.
When you leave your local maximum, you may need to redo things and conquer the fear of losing what you’ve already achieved. If that happens, remember that the boldest part of any plan is to see it through.