The Good Idea Trap™ Explained
Updated: Oct 14, 2019
Growing up, we always thought that if we came up with one good idea we would be rich. The American Dream. But a "good idea" is not good enough.
In our personal lives we make decisions about buying a car, taking a trip or going to the new restaurant down the street by asking ourselves if it is a "good idea."
However, organizations have a much more difficult problem. There are usually many more good ideas than there are resources. The fundamental job of management is to allocate FINITE RESOURCES to the tasks, projects, etc. that further the goals and mission of the organization.
To put it another way, there is NO JOB for a Chief Financial Officer if there are unlimited resources. Financial analysis is irrelevant. The theories around Finance and Economics is based on the concept that you have FINITE RESOURCES.
In other words, the tools of finance are about analyzing ideas and comparing them financially. Beyond that they must be analyzed in terms of their ability to drive the mission and achieve goals.
So the best organizations, companies, non-profits, and government entities, find ways to allocate their resources to maximize results. Resources include both money and time. If you focus your resources on the most important goals you increase the likelihood of success.
Organizations that lack focus generally spread their resources too thin. They either take too long or never achieve their goals. This is the GOOD IDEA TRAP. The belief that we can do all the good ideas or all the ideas that are just "good" enough.
One of the best examples of a company smartly allocating resources is Apple Inc. Founded by Steve Jobs in 1976 in Cupertino, Calif., Apple was new to the consumer electronics space. They had many paths their company and products could take but what sets them apart is their focus and commitment.
Everyone thinks of Steve Jobs as a great innovator, but his most important management talent was to focus the organization. Every year he would take his management team offsite with a long list of good ideas. He would force the team to come up with the top two or three top projects and FOCUS on them. Apple makes few products but they do them exceptionally well.
It's not quantity that matters. You can fit most of Apple's products on a small table but these products drive billions of dollars of revenue each year. When you rationalize resources there will be projects or ideas that you can't do. There will be some angst that you aren't doing all the good ideas. This is a natural feeling. Rationalization of resources is a difficult and sometimes unsatisfying process but it is essential to the long term survival of any organization. You can avoid the GOOD IDEA TRAP.