How to Prosper in the Wicked Learning Environment of Young Industries
While it is hard to change the fundamental qualities of the industry you are working in, you can influence the quality and frequency of the feedback you are getting.
In his research, the psychologist Robin Hogarth introduced the concepts of a wicked and a kind learning environment to illustrate the fact that the feedback any actor gets from the environment in which they act is of a different quality. In turn, the quality of this feedback affects the quality of the inferences that the actor makes.
Said simply, in some environments, learning and getting better is a straightforward task. In others, it is very easy to deceive yourself that you are an expert, while at the same time having a very weak actual grasp of reality.
A good example of a kind learning environment is the game of chess. The clear and unchanging rules of the game and the almost-instant feedback you receive from your moves guarantee that by playing more, you will understand the game more deeply and become better.
On the opposite end of the spectrum are wicked environments in which information is hidden, convoluted, and feedback is delayed, inaccurate and infrequent.
Unfortunately, the environments in which startups exist more often than not are wicked rather than kind. New, innovative startups prosper in industries that are unexplored and changing at a rapid pace, which means that information is scarce, and your knowledge of the market can rapidly become outdated.
Fortunately, while it is hard to change the fundamental qualities of the industry you are working in, you can definitely influence the quality and frequency of the feedback you are getting, which, by definition, would make it a kinder learning environment.
This is the major reason why the industry-standard first steps of running a successful startup are all related to gathering reliable feedback and information about your concept. Idea and product validation is the key to avoiding self-deception, as they improve the chances that the inferences you are making about the market and your own startup are correct.
Of course, this is easier said than done. Gathering accurate feedback from the market is a skill in itself that you need to develop. It's very easy to be deceived by vanity metrics that are not direct proof of movement towards real product-market fit (which should be your ultimate goal in the early startup stages).
For example, you could get high interest from investors in your project. While this is, generally speaking, a positive sign, it isn't necessarily a real indicator of the viability of your idea. It might be the case that investors are investing because of your CV or your great sales skills while also being as blind as you are to the actual future potential of your project.
Yet, investors are only risking a small portion of their capital, while as a founder, you are risking years of your life that you wouldn't be able to get back. Because of this, even though it would be tempting, moving forward with your ideas based on this single point of feedback might be unwise.
The best leading indicator of product-market fit and the future success of a startup is the so-called market pull — real, proactive interest from your consumers. Because of this, the best way to make your learning environment kinder is to choose a key performance indicator that reflects as close to reality as possible how actively your customers are using your product or service.
This would usually be some kind of a usage metric. For instance, if you are creating video content, "hours consumed" could be your north star, as it is a function of how many people watch your content and for how long (i.e., how engaged they are) — the main things you should care about. By actively measuring how your actions change this central KPI, you'd be able to make much more informed decisions, and you wouldn't waste your time as an entrepreneur. In turn, this would result in effective growth of the size and engagement of your audience, which would naturally lead to business growth.
In other words, focusing on it would make your learning environment kinder. The feedback you are receiving is clear and readily available, which in turn would reduce the chances of self-deception and improve your long-term chances of success.
Failing to make your learning environment kinder leaves your success to chance, and even worse, it doesn't allow you to draw the right conclusions from your successes and failures.
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