You are tone blind

All the written electronic communication we do as a society has given us enormous gains, but most of us (including Inc. columnist and business owner Joel Spolsky in an example below) suffer from a frequent inability to accurately read the intention of this type of communication.

We are tone blind. Or more accurately, we are blind to more than a few communication cues that we more easily utilize using verbal communication like intonation and stress.

It doesn't help that we usually think adding emoticons and internet lingo is considered unprofessional and something for texting teenagers.

As humans, understanding someone's intention of their communication is of super importance, but it's not always an easy feat. Here's an example found on about.com:

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I don't think he should get the job.

Meaning: Somebody else thinks he should get the job.

I don't think he should get the job.

Meaning: It's not true that I think he should get the job.

I don't think he should get that job.

Meaning: That's not really what I mean. OR I'm not sure he'll get that job.

I don't think he should get that job.

Meaning: Somebody else should get that job.

I don't think he should get that job.

Meaning: In my opinion it's wrong that he's going to get that job.

I don't think he should get that job.

Meaning: He should have to earn (be worthy of, work hard for) that job.

I don't think he should get that job.

Meaning: He should get another job.

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Depending on where you put the emphasis in this sentence by using stress, the sentence has totally different meanings. The meaning here was only conveyed because I spent the time using Bold. But often we don't spend the time using tools like Bold and we blast off an email as soon as the words pass our fingers.

Here's an example from the real world I saw recently. Joel Spolsky, a personal hero of mine, wrote a column in Inc. magazine about some growing pains his company might be having. To more than a few people, they felt that the article is a bit of a subtle marketing piece. Right or wrong, that was their opinion. So one guy made a comment about such opinion:

"If increasing your growth rate is your objective, this looks like a very nice first step, Joel. You disguise a PR piece as an objective 'how to' in a national business publication, coming across as an authority, the underdog, and an all around nice guy who really cares about his customers. You're an engineer who claims to be 'weak' in the sales department, but all evidence to the contrary: nice 'sales hack'. Any reasonable person who takes your advice would be a fool if he bought from your competitor. Not bad for a couple hours work. Kudos."

Joel's reply:

"Jeez, everything is a conspiracy on Hacker News. How about I wrote it because I'm a columnist at Inc and I have to turn in one article a month? And how about, they hired me because they like columnists who are actively running businesses to write about the issues they face? (c.f. Norm Brodsky, the other columnist, who has some kind of a box storage business). None of the plumbers and dog shampoo-vendors who read Inc. do software project management. The number of leads I get from Inc readers is laughable. Also, you're confusing sales and marketing. They're different things. We're pretty good at marketing for a company our size. We're absolutely bad at sales."

Joel seems a bit insulted and attacked by the first commenter. Even though the first commenter cleared up in a later comment, that he WASN'T being sarcastic and was trying to genuinely complement Joel on his article.

I imagine this conversation in person would have been much more constructive and useful, if these 2 people were in person or talking on the phone and could read each other better through audible and visual cues like smiles, hand shakes, and the intonation of the comments.

This happens every day for us folks who manage projects and teams online. We have to use email and instant messaging very well to collaborate together. And for many reasons, it's our preferred communication channel at Inkling.

Email allows people to work asynchronously and schedule interruptions better so they can get more work done while they are in a zone. But often a discussion over email can easily turn into an unintended disagreement because the intention of the written word was inaccurately understood.

At Inkling, we've picked up a few habits to try and combat this, which might help others to keep in mind.

1) Emoticons and internet lingo (lol, brb, lmao, etc.) do have a place in "professional communication". They aren't just for teenagers.

A :) easily lets your reader know you are smiling when you are writing your words. Just like a ! helps share that you are heightening your voice or emphasis. Don't be afraid to use these tools even with your clients to help convey your mood and your intonation.

2) Compliment, compliment, compliment. Most of us don't feel appreciated enough for what we do for other people when times are good. And now given tougher economic and political situations, there's an air of stress in many places. Complimenting people and showing gratitude early and often is a big help in producing effective written communication.

Even if a later point you make in your communication is misconstrued, an earlier mentioned compliment or thank you easily sets up a better follow up note or phone call to clear up a matter.

3) And most importantly, know when to graduate communication mechanisms. We graduate to phone calls pretty quickly. It's amazing how often, what seemed like a disagreement over email turns into a very constructive conversation over the phone. Things get cleared up, and intentions more easily understood.

The written word continues to be increasingly important in how we operate together in teams and in projects over the internet. We've learned that it helps to spend a bit of extra effort in conveying the mood and intent of our writing. Hope some of these tips help.

Speed reading: How I started reading 3-4 times faster in just a short time

I increased my reading speed by 3-4x recently. I was a bit skeptical that I could pull it off, but had a lot of hope, because I knew people that could do it. And now here's a couple tips on how I've accomplished it.

First of all, I credit my improvement to a 5 hour class I took at Iris speed reading.

I can share a couple of my notes and things I'm doing now, but a 5 hour class with Iris is totally worth it. It's one of the best 5 hours of learning self improvement type stuff I've done in many many years.

The reason people read slow is usually because of a mix of 3 things:

1) We often go back and reread stuff we just read. Either we didn't understand the last sentence, or we stopped paying attention. Either way, this slows us down a ton.

2) We use our eyes to glance at every single word. Growing up we learn to read by reading each letter at a time. No one teaches us to digest whole words or entire sentences using all of our vision. You absolutely have the ability to digest more characters and words than you are now. You already digest more words and characters in one glance than you did when you were 5 years old. Imagine if you trained that ability.

3) We subvocalize words. Similar to reading every single word with our eyes, often we read by actually vocalizing the words in our heads. Does it sound like you are talking to yourself in your head when your reading? A lot of people hear that voice. It slows you down. You can read a lot faster than you can vocalize words. So you need to force the voice in your head to quiet down.

Training your eyes

So here's one great exercise I'll share that helps stop these 3 things above. There's definitely more exercises, but this one is my favorite and probably the most effective.

Take 5 minutes, a book and just read it as friggin fast as you can.

The key is to just see words as fast as you can. Don't even try to understand what your reading. Pretend it's another language, one that you don't understand. Pretend it's Klingon. You don't need to comprehend anything during this exercise. Just see words, lots of them, and super fast.

Use your finger during this to trace underneath each sentence. Using your finger is exactly what your parents and your teachers wanted you to stop doing as you learned. Which is a shame, because that finger really helps guide your eyes.

Most importantly, it keeps you in a groove and stops you from going backwards.

After 5 minutes, take a break, rest your eyes, then do this exercise 2 more times for a total of 15 minutes.

Go try and read a book now, but this time in order to comprehend the words.

You'll probably be amazed at how much faster you are reading just after doing this exercise 1 time. But just like any other exercise, you can't just do this once. You can't just do this a few times and then be an expert.   

Start with doing it 7 days in a row. Take a break, then do it for 14 days in a row. Just know that you'll need to revisit this exercise occasionally to keep your reading in shape.

Better comprehension from better skimming

So above was all about speeding up your eyes and your brain at seeing more words. But speed reading is also about comprehending better. For that, the technique I use is something akin to better skimming plus repetition.

I read every chapter 3 times.

The first time, I just read the first paragraph or 2 of a chapter and the final paragraph of that chapter. This gives me just enough to know what the chapter is about. I read at a pace that's comfortable for comprehending.

Then I go back to the start of the chapter for my second read. This time, I read the first sentence of each paragraph in the chapter. Sometimes I'll read a couple sentences if the sentence is pretty unremarkable. Again, I read at a pace that allows me to comprehend. I don't try and read fast.

Now, I go back to the beginning of the chapter for the 3rd and final time. This time, I try to read the chapter focusing on speed. I'll try and capture the main point of each paragraph. But I'll feel free to skip paragraphs I remember from my second reading as being kind of useless. And so I go through the chapter very fast.

Afterall, from the second reading, I have an outline already of what's kind of important and interesting in this chapter that I want more information about. I'm amazed at how many interesting chunks I can pull and remember from these books now. I'm learning better how to basically skip things I think are filler (determined from the second pass).

That's about it. Of course, I probably wouldn't read poetry like this or some kind of mystery novel. But this is an awesome technique when you are trying to get read through lots of other material. For example, I love reading business books. This is a great way to get past a lot of the fluff and redundancy. A lot of these books should be about a third as wide as they are now anyways, but that's another story.

Give it a go. But be warned, this is a great way to find yourself spending a ton more money on books. Now I have to manage all this book shopping I'm doing. I'm going to have to get a bit more handy with the public library.

Hire employees to boss you around

"If you want to build a ship, don’t drum up people to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea."

- Antoine de Saint-Exupery

Hire people who can not only manage themselves but can even manage you.

You're going to laugh, and I'll probably lose 90% of readers here :) But for full disclosure: I've just now gotten around to reading 7 habits by Stephen Covey. There's actually some good stuff in there. Yeah, yeah, yeah. Mission statements, win-win, Synergy! :) yada yada yada.

But I've recently been working on speed reading, and upgraded my reading speed by 3-4X. So now I can pick up books and get a lot more value out of them, because their verbosity and redundancy isn't slowing me down or wasting my time. (I'll share some speed reading tips soon.)

Anyways, Covey has a good bit in there about him teaching his 7 year old son to take care of the lawn. He basically helped show him how and then gave his kid some basic guidelines. Here's part of the conversation with his kid, Covey begins:

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"So you boss yourself. Now, guess who your helper is."

"Who?"

"I am," I said. "You boss me."

"I do?"

"That's right. But my time to help is limited. Sometimes I'm away. But when I'm here, you tell me how I can help. I'll do anything you want me to do"

-------------------

Everyone's trying to figure out how to keep their employees motivated. So many of my friends and family express that the dread in their workplace is palpable. It's the economy, it's the weather, it's something. So I can't help notice the questions folks ask about hiring, or motivating their employees, or how to get them kick started again "to be innovative" :)

I've found the best "motivation" is to treat your employees like the smart adults they are. They become demotivated when they are treated like worker bees. Not every company feels they have the luxury to treat their employees this way, but look at the successes at 3M, Google, Facebook, 37signals, where they give tons of freedom to employees to invent their own projects.

Make sure your employees have some guidelines about where you want to go. Then go ask them what they want to and should work on. Maybe it can't be 100% of the time type of project, but you might be able to give them a good chunk of time to work on it. There's nothing more motivating than when they become their own bosses and start creating or just doing what needs to get done like a human being naturally does.

I make a habit of constantly asking - what do you think we should be working on?, what kind of technologies would you like to be working with?, and then we make an effort to try out those projects. I never had that kind of opportunity in my 7 years of working for other people, and I hated almost every minute of it.

I love it when folks I manage assign me tickets. "I added this feature we were talking about, can you take a look at it to see if it does what it should do?" or "I saw an issue and made the following change... can you double check it before I release it?" or "I'm thinking this new feature might really help people do..." This helps me manage my time by putting these things in the queue by priority and allows employees to move onto the next thing instead of waiting around for feedback.

Let me know what I need to do to help you.

Too many companies just want their employees to work like drones. If you want your employees to feel like drones, just keep feeding them tickets in the ticket system without opportunity for input.

Find people who can boss you around.

"My new Icelandic trainer's rule: what you ask of your horse, YOU must be able to do. I've been riding up hills, fast. I'm toast."

- Kathy Sierra

Amazing sculpture at PopTech

PopTech doesn't get enough press. Had the pleasure of attending it last year, and there's some awesome things going on there. I didn't get to go again this year. But you can still watch all their talks streamed live.

Here's some video of a gorgeous sculpture Reuben Margolin built that he showed off today.

"It is more noble to give yourself completely to one individual than to labor diligently for the salvation of the masses."

- Dag Hammarskjold, former Secretary-General of the United Nations

Pay for your own dog food

By now you probably haven't missed someone extoling the virtues of eating your own dog food. Just in case you have, all this means is that you use your own product.

Using your own product comes with a ton of benefits, because you become your own customer. The quality of your product likely increases because you can't ignore it's problems. They aren't just your customers problems. They are your problems.

But I know a ton of people that don't actually pay for their own dog food.

Starting a new product or business can be tough. One of the challenging debates is:

"How much should we charge" or "What should our pricing plans look like"?

Pricing can be a complicated discussion. Especially since you want to make sure you make profit over the costs of running whatever it is your selling.

But the best way to short circuit some of the debate is to simply ask:

What would I pay for this?

At Inkling we don't just ask.

We've gotten in the habit of actually taking out our own credit card and using it on our own account sign up page. Yes, it's a bit silly when the credit card processing takes some money off the top. But it makes the feeling very real that you are paying for this, and now it's an expense just like it's going to be an expense for your clients.

So when we started Tgethr (our simple tool to collaborate with groups over email), I stuck my credit card in to pay for the plan that met our own team's needs. Through doing this, I found I was paying $99 just to support the groups of family and friends and the folks at work with this software.

After a couple months of getting dinged that $100 for my particular situation, it didn't feel right. We were charging too much. So we tweaked the plans to offer more storage, more groups, so that I could move myself to a smaller plan and now start paying $49 a month, which feels much more realistic or fair to me as a customer.

So if you are debating how much you are going to charge for something, I'd start with doing exercises like this. If afterward, you find your pricing + customers don't support your costs, then you are going to have to provide much more value to justify raising prices.

(Part of this is a cross post of an answer I gave at answers.onstartups.com, a new and pretty useful site for startups who want to ask other entrepreneurs questions.)

If you want to build a ship, don’t drum up people to collect wood and don’t assign them tasks and work, but rather teach them to long for the endless immensity of the sea.

- Antoine de Saint-Exupery (found on Creatively Maladjusted)

How successful would a football coach be without ever having played a single game of football?

Not very, right?

And yet constantly, people (a business owner, a manager) try and manage the production of something they have never had an ounce of experience producing themselves.

I get asked a lot by friends without any experience programming: "how do I build this idea for this software application without any experience?" or "how do I find technical employees or co-founders"?

To curtail the objections, I'm not saying a business owner of a software company needs to be a software engineer. I'm not saying a division lead of a consumer products company has to have run the stirring vats making soap.

Look at Mike Tomlin, the youngest coach to win a Super Bowl and the current coach of the Steelers. He hasn't played a single game of professional football. But he did play college ball.

I'm saying any experience in the thing you are trying to lead or manage will pay extremely huge dividends.

So if you are a "business guy" and you want to start a business that makes a new iPhone app. It would behoove you to buy the most basic iPhone building tutorial you can and try to at least get past the first chapter.

You don't have to work on the application you intend to build. You don't have to finish the book. You don't have to raise your blood pressure or feel even successful at the tutorial.

Just that smallest iota of that book: downloading some tool, making the iPhone beep or print "hello world", gives you a huge leg up in what you are trying to accomplish.

A great example of this is Adam, one of our founders and CEO. Adam isn't a developer. But he's learned a bit about Ruby, the language Inkling is developed in. It saves him an enormous amount of time when a little thing needs to be tweaked. He can do it himself rather than wait until a developer has the resources available.

Secondly, he has a much better idea of the effort many of the tasks might take that he needs to manage, design for, and communicate to our clients. His effort in experiencing the pain of development has been an investment he's made with a big return.

At Inkling we manage many functions being a small business. We aren't lawyers or PR people or trained marketing people, but we have experience now doing these things for ourselves. So when we do hire the experts to work on these things with us, that experience makes the conversations and projects we manage 100 times better.

The struggle and challenge you go through doing this type of exercise, will change your perspective about the people you want to lead. You'll have much more knowledge and confidence working with the people you now have to hire to actually get the job done well.

"Design's too important to be left to designers"

Also a good bit in here about "Building to Think"

"The significant problems we face cannot be solved at the same level of thinking we were at when we created them."

- Albert Einstein

Catching the Crazies

My Sister a couple years ago introduced this great phrase to me which I try to use whenever I can. When she thinks I or someone else is being ridiculous she says: "Adam, you've caught the crazies!"

It seems every few months when something unexpected happens, journalists and pundits who monitor prediction markets "catch the crazies."

The latest example is the round of Nobel prizes. Today, Elinor Ostrom from Indiana University and Oliver Williamson from Berekely were awarded the prize in Economics. Conventional wisdom said Williamson was an outside shot and Ostrom wasn't even on anyone's radar screen. On our public marketplace, Williamson consistently had a 3 or 4 percent chance of being the winner. Did this mean Inkling "had it wrong?" No, it meant Williamson was perceived to have an outside shot based on the information available to people interested in these things.

Why is it consistently so surprising then to the media that the prediction market prices reflected this? It's not like they were reporting anything different. Prediction market prices are simply an aggregation of information available to people and their reaction to that information in the form of buying or selling shares. Markets about Nobel prize winners and the like are great fun but with a lack of information available to traders because of the secretive process, they're not going to be very useful.

Contrast this with a question asked internal to a company where a great deal of information is available, the traders are typically influencing the outcome or they know the actors who are, and there is usually historical precedence. That is an appropriate use case for judging prediction markets on their ability to not only match forecasted probabilities with reality, but provide tangible business value in the form of cost savings and risk awareness and avoidance.

The name "prediction market" is one I've never liked because it oozes having "crystal ball" powers which means there is inevitably going to be a backlash by the media and bloggers when public prediction markets fail to look like they had the inside scoop. Unfortunately I don't think many writers will suddenly explore the nuance of what a prediction market price means or a good question vs. bad as it's certainly easier to just say "they got it wrong" or "they got it right." It's a design challenge we continue to work on to see how we can continue to simplify the output of a prediction market and make it as digestible as possible. We also try to help people understand what prediction market results mean and when a question is going to garner good feedback vs. unreliable feedback, but it's clearly a road we still have a ways to go on.

"Criticize by creating"

- Michelangelo

Great business card design on recycled cereal boxes

Business cards seem so antiquated these days and yet there's still a constant need for them.

One day we might even all be able to bump our phones to exchange data. But "back in the day" we used to have infrared on our phones and PDAs that promised that same convenience of shooting our contact information over the aether. But alas, we never seemed to actually do that.

We still pass around bits of paper with our email and phone numbers on them. Because it's still the most convenient exchange in a meeting with someone new.

No one has to find a pen or clickity clack on their blackberry or iphone.

Business cards remain around, even if they just exist long enough to pass the email address to someone who proceeds to enter it into their address book and throws out the card.

Some business cards though still make an impression. Here's one that I recently saw that raised an eyebrow.

Caught my eye right away as the card isn't even cut straight :) But it gets the job done. The info isn't letterpressed or even laser printed :) Just a stamp. A crooked stamp at that.

Turn the card around and you see it's on the inside of a cereal box.




Still seems like a pain in he butt to be cutting these up and stamping them yourself. But now I'm interested in having my own.

(Nat & Hellens is a great store by the way if you are looking for cool gifts for babies)

"An interesting new study looks at how being able to count your own heartbeats - the most elemental form of biofeedback - correlates with better decision-making, at least when playing the Iowa Gambling Task."

- Jonah Lehrer: Listening to Your Pulse

A failed project in a previous job. And Seth Godin's advice.

"Today, R&D organizational work processes focus on generating the final specification that is handed off downstream to manufacturing. This work generates the equivalent of 5% of the total information created. More importantly, 95% of the effort and knowledge created along the way, critically vital information, ends up being lost unless processes, systems, and databases are in place to capture these critical organizational assets."

- Howard R. Moskowitz

I had the pleasure of presenting what prediction markets are all about to an audience at Palladium's 2009 Business Performance Conference.

One thing I touched on was a project that failed at a previous job. Let's call it Project Fail.

This project had already been going on for a few months with 5-6 people before I came on board. And they brought me on to put to add some finishing touches to help roll it out the door as something presentable to potential clients.

The specifics of the project aren't all that important.

What is important, is that the project was doing something that seemed an awful lot like another project I had friends on 4 years prior to this (Project Forgotten). Project Forgotten was shut down for various reasons, and I had heard of those reasons around the water cooler.

We didn't have social networks after all 9 years ago. This was just talk in a computer lab. We didn't all have our own computers back then either :)

So when I saw what was going on at Project Fail, I immediately saw some of the same things going on that happened on Project Forgotten.

I felt there was a major risk of Project Fail getting shut down.

I brought it up with my boss who had to bring it further up the management ladder to someone who could make the important decisions here.

I explained the evidence that there was a huge risk of this project facing those same legal challenges.

They heard me out.

But didn't take the threat seriously. I think they also felt that the project was far enough along, what could they do now anyways. They had to see it to some completion.

Wouldn't you know, a few days later my boss's boss gets a call from someone further up in the company that got wind of the project. This guy wasn't happy since some of those retail websites were clients of ours, and the competitive use of this data could be a big risk to those client relationships.

Project cancelled.

Seth Godin in the video below talks about the concept of "thrashing" he learned from Steve McConnel's writing and Steve's work at Microsoft. Thrashing is all the conversations and debate and meetings and more meetings that occur when more than one person starts getting involved in a project.

Seth Godin would have said we needed to start "thrashing" more on this project when it was cheap. When the project was just ideas and words on paper.

Thrashing this late in the game of new product development wasn't very useful. If I had had a way to pay attention to all the projects going on in my little group/world at this much larger company, maybe I could have raised this issue before they wasted months of money and time on this project. Maybe they could have steered the project in a direction to make these clients happy. Maybe they would have just killed the project. Before all the waste.

If we had had a social network or a more social project management experience that would have helped a great deal with moving the thrashing earlier in the project.

And I'm even more sure a prediction market would have given us the incentive to pay attention to those projects within our group.

Prediction markets are social networks for metrics.

Things get measured. A culture of metrics starts to form. And people have an incentive to keep paying attention to those metrics.

  

Seth Godin: Quieting the Lizard Brain from 99% on Vimeo.

To deal with an uncertain future and still move forward – they advise people to have "strong opinions, which are weakly held."

- Bob Johansen about wisdom

Predicting Milestones with Inkling (ala Basecamp)

Since we've launched widgets in Inkling, it's become trivial to integrate a prediction market with most other applications that could benefit from better decision making.

For example, now you can get some help coming up with your project milestones. We'll take a look at what this could look like using a scenario with 37signals' very popular (and rightly so) project management application Basecamp.

Let's pretend I've already setup a first crack at predicting that our company will have a hypothetical integration with Amazon's Mechanical Turk done by Friday, Oct 9. Here's the milestone in Basecamp.

We'll use a comment to this milestone as a container of our widget. So click on the comment icon to add a comment.

Now, let's go create a prediction market that asks when this milestone is going to be accomplished. (We won't go through the steps of creating a market here. There's plenty of instruction inside :) But please let us know if you ever need more help.)

Here's our market ready to go. I can now click the "Trade from your site" icon on the market page to get the embed code for the trading widget.

Grab the embed code your given or tweak it to match your desired design. And just add that to a comment in your milestone. Here we go back to Basecamp and add the new comment.



"Add this Comment" and now your Basecamp users will have a prediction market clickable right from inside Basecamp. They don't even have to login or give any care in the world that you're using Inkling.



And after I've shared my answer.



So there it is. Prediction markets in more places. You can have the power of better group forecasting without forcing your coworkers or employees to ever leave the applications they are most comfortable with and already enjoy using.

Hope that provides some more ideas of where you can use prediction markets next.

"We spent some time in our family talking about what's the trade-off we want to make. We spent about two weeks talking about this. Every night at the dinner table"

- Steve Jobs on the decision making process he used to pick a washing machine.

"Of course, this wasn't really about washing machines; it was about passing along the concern for design to his children and perhaps to (his wife) Laurene"

Irrational Decision Making

"when you don’t create things, you become defined by your tastes rather than ability. your tastes only narrow & exclude people. so create."

- why the lucky stiff

Building something people want

Here's the latest article from Joel Spolsky in Inc. magazine.

Probably worth a read for anyone involved in product development.

We had the pleasure of meeting Joel when we first started Inkling 4 years ago in Silicon Valley. Joel spoke to the group of Y Combinator startups at our weekly meeting.

The biggest piece of advice he gave is in this article.

Figure out the root problems that matter.

Too often we tend to think we have this problem and that problem and this problem.

For Joel, and very likely many companies building new products, the most significant problem to work on is building a useful product. It's not worrying about people stealing your ideas or building some difficult to manage affiliate network. It's not the perfect Google Adwords campaign, or the perfect font size.

It's building something people want. And then doing that some more.

(Borrowed from a Y Combinator motto.)

Decision Jujitsu

"Making yourself open to correction and persuasion is a pillar in the strategy of principled negotiation."

-Roger Fisher and William Ury (Getting to Yes)

Decision making often seems to be yet another negotiation we have.

Again and again that negotiation is with ourselves.

Trading widget mimics the ease of polling online

Snap polls are ubiquitous across practically every content site on the web. "Should Apple launch a tablet PC?" "Who will win the football game?" "Should Kanye be banned from all future awards shows?"

People love these polls because they're quick, easy, and provide instant gratification in feedback to see what other people think.

Prediction market trading has a lot of these same attributes, and in many cases provides much more valuable data than a simple poll, but the act of "trading," whether as a trade or a bet or some other transactional mechanism is also a more complex concept for people to grasp.

In our continuing efforts to 1) keep things simple, and 2) bring trading to the casual/fickle user (we're talking about you, executives,) we've created a new trading widget that behaves exactly like a poll, but in the background, a prediction market trade is being made.

Here's how it works:

Once you've logged in to an Inkling public marketplace (or are signed in as an administrator of a private marketplace) you'll see a link called "Trade from your site:"



When you click on that you'll see a sample of the widget you can put on your own site:



Looks a lot like a plain ol' poll, right? That's the point! But there's a slight twist. When you click on an answer, you have to take one more step - you have to quantify your opinion and this is where the behind the scenes trading comes in. Just like trading in Inkling where we've equated English words with shares being bought or sold, we're doing that here too but not even telling you about it:



Once you select how strongly you feel about your answer, you get to the gratification part and see what everyone else is thinking. If you're logged in to the Inkling site the widget originated from, the trade will be recorded on your dashboard just like any other trade. If you're not logged in or not a member of the marketplace, you will be given an opportunity to login or "claim" your opinion by registering.



We've purposely made the widget "plain" and given you the ability to customize the look and feel by importing your own .css stylesheet to make it look exactly like your own site:



We're really excited about this new widget and are already working with our partners in market research to think about how this could replace certain surveys and polls they run.

We're also working with our existing clients to help them think about how they can put this widget on their internal Sharepoint or Intranet sites to draw more attention to the questions they're asking. It could even be a way for clients to expose questions they're asking externally without having to engage someone in an entire prediction market experience.

Ben Franklin on making decisions

Breaking Bad just won an Emmy.

Basically, it's about a high school teacher who makes odd decisions.

Most significantly he decides to start making crystal methamphetamine to make lots of money before he dies of cancer. Not a spoiler. You learn this real quick if you get started with the show.

In the first season, he's also up against a decision to kill a man.

He uses a list of pros and cons to decide.

I'm not going to share anymore of the story since that's best left up to watching this terrific show :)

But I was curious where the pros and cons method came from.

I think I may have learned it originally from my mother or maybe in grade school.

Regardless if you do a tiny bit of research, Ben Franklin comes up a lot in discussions of this method.

It's just that his method is a little more systematic than how we usually go about it. And maybe more useful.

The method he uses is mentioned in a letter you can find all over the internet to a Joseph Priestly. Here's the text of the letter I found here.

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To Joseph Priestley
London, September 19, 1772

Dear Sir,
In the Affair of so much Importance to you, wherein you ask my Advice, I cannot for want of sufficient Premises, advise you what to determine, but if you please I will tell you how.

When these difficult Cases occur, they are difficult chiefly because while we have them under Consideration all the Reasons pro and con are not present to the Mind at the same time; but sometimes one Set present themselves, and at other times another, the first being out of Sight. Hence the various Purposes or Inclinations that alternately prevail, and the Uncertainty that perplexes us.

To get over this, my Way is, to divide half a Sheet of Paper by a Line into two Columns, writing over the one Pro, and over the other Con. Then during three or four Days Consideration I put down under the different Heads short Hints of the different Motives that at different Times occur to me for or against the Measure. When I have thus got them all together in one View, I endeavour to estimate their respective Weights; and where I find two, one on each side, that seem equal, I strike them both out: If I find a Reason pro equal to some two Reasons con, I strike out the three. If I judge some two Reasons con equal to some three Reasons pro, I strike out the five; and thus proceeding I find at length where the Ballance lies; and if after a Day or two of farther Consideration nothing new that is of Importance occurs on either side, I come to a Determination accordingly.

And tho' the Weight of Reasons cannot be taken with the Precision of Algebraic Quantities, yet when each is thus considered separately and comparatively, and the whole lies before me, I think I can judge better, and am less likely to take a rash Step; and in fact I have found great Advantage from this kind of Equation, in what may be called Moral or Prudential Algebra.

Wishing sincerely that you may determine for the best, I am ever, my dear Friend,
Yours most affectionately
B. Franklin

Source: Mr. Franklin: A Selection from His Personal Letters. Contributors: Whitfield J. Bell Jr., editor, Franklin, author, Leonard W. Labaree, editor. Publisher: Yale University Press: New Haven, CT 1956.
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So his method of pros and cons brings up points that are a bit different then we typically might use:

1) Spend a few days on creating the list. Don't try and bang it out in one sitting. Sleep on it. This might be the best of both worlds for people who've seen the new research that sleeping on a problem to let it work out unconsciously might not work.

So this is a mix here of conscious analysis AND sleeping on it.

2) It's not just about which side has more pros and cons. Each gets a weight to consider.

One additional thing I've seen introduced to Ben's methodical pros and cons that he doesn't touch on in the letter is how to determine weight.

Typical of most businesses risk or issue logs, you would determine weight by multiplying an issue's probability of happening and its impact.

If you have 2 issues (A and B), sure A might be of more serious impact than the other, but if it's of a very slight probability of occurring, issue B might be of more importance in prioritizing (i.e., might have a higher weight)

In fact, here's a blank sheet using this approach.

From a guy named Fred Nikols at Distance Consulting.

New Feature: Managing categories is now even easier

Before, if you wanted to manage a set of categories for your prediction markets you had to create them ahead of time from your marketplace settings.

Now, if your an admin of a marketplace, you can manage your categories while you are creating a market. So you don't have to miss a beat.

In you market's "Details" tab, just look for the "Manage categories" link (it's labeled "Add a category" if you don't have any yet).

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Click on it and you'll have a simple pop-up to add or delete your categories. Here's what it looks like on our public site.

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We hope this small added feature comes in handy.

Save money on split testing using Amazon’s Mechanical Turk

By now, most of us have heard that we should be testing. A/B testing. Split testing. Multivariate testing.

You should test your ads, test new features, test minimum viable products, test emails, and on and on.

And we totally agree.

But there are problems with it. One big problem is cost.

For example, it quickly gets very costly to split test Google ads if each click is $3.

Or what if you want to take an ad out on a premium ad network like Coudal's The Deck or Fusion Ads.

A Deck ad is $7200.

So this is something that for many small companies isn't something you can whiff at, and test a new ad on the second month to see if it does better.

You'd like to figure out as cheaply as possible and as soon as possible how to put your best foot forward.

I'm not saying we have a solution at all to this.

But we did something we find interesting that maybe we or someone else will find useful down the road.

How successful is testing things like ads, headlines, concepts, etc. with Amazon's Mechanical Turk?

Especially since from what I read, getting someone to do a simple task on the Mechanical Turk is cheap. $0.01 a task for example.

We setup an experiment.

Can the folks on the Turk pick the best converting headline if given a selection of headlines?

(Primarily though, this whole experiment was so that we could learn more about the Turk. So to preempt any, "you should have done it this way" or "why are you using the turk + wufoo" for this, we'd love to hear any input, but this was first and foremost a reason to understand how to use the Turk to do anything. Anything else is just "interesting", probably pre-useful, and we wanted to share it.)

I used a selection of headlines I already knew the results for with a Wufoo form. This was a test 37signals ran for their headline.

(This test isn't approved, endorsed or affiliated with 37signals in anyway.)

For background about their test, they saw statistically significant results showing them that 2 of the headlines were better than the rest. Headline A and Headline B converted (30% and 27% respectively) better than the original headline. As confirmed by Jason Fried, statistically Headline A and Headline B improvements are the same at this point. But they liked one of them better than the other, so they claimed Headline A the winner. Statistically however, Headline B could have been chosen as a winner as well.

We are in the business of crowd wisdom, so I'm already hopeful this experiment would show some wisdom from workers on the Turk. But given the incentive of say $0.01 to just complete the survey no matter what, I figured everyone would just click on something randomly to complete the task without thinking. And not a single ad would provide a strong signal.

If that didn't happen, I figured maybe some of the respondents will have heard of 37signals or knew the answer to this post and they'll pick the headline 37signals claimed as the winner.

Here are the results. Which didn't agree with what I thought I'd see.

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Headline B (named in the 37signals background above) was the winner (38.89% +- 7.1%).

The next best headline was chosen by 16.67% with a confidence interval of +- 5.4%.

So Headline B was chosen with significance from workers on the Turk to do better. And obviously from a test in the real world from 37signals, they saw great results from that headline.

Surprisingly Headline A though, which performed very well in real life, was just in the middle of the pack.

More experiments need to be run to prove any kind of usefulness here. One reason for the behavior seen could be that Wufoo's randomization of the survey choices is biased. In my opinion, this isn't likely, but we plan on doing more tests to see how they play.

I think though that this provides some encouragment that the Turk could prove itself as a crowd that can be used and tuned to make good predictions when you need one.

There's definitely some more experiments we're doing with the crowd at Amazon's Mechanical Turk coming soon...

"On Prototyping: The Simplest Solution Never Comes First"

"But the long journey from visionary idea to intuitive product is a trajectory worth contemplating. In the case of Herman Miller’s new Setu chair, designed by Berlin outfit Studio 7.5, the numbers are telling: 18 months of self-financing, 5+ years of development, and 40 fully functional prototypes."

Read more on The 99%

Vitaminwater is crowdsourcing a new flavor using market research from a game

"Vitaminwater, the beverage brand that has become nationally-known this decade through clever marketing efforts, is making another innovative move today — on Facebook. It has launched its own application, called “flavorcreator,” that appears within its Page and intends to get users creating their own virtual vitaminwater beverages."

Read more on Inside Facebook (via Kissmetrics and Justin Smith)

Flickr stream from Tap the Collective DC event

We just got the photos back from the photographer we hired to shoot our event in Washington. I've uploaded them all to Flickr. Video of the entire event to follow early next week! Have a great Labor Day weekend.

Inkling's Flickr Stream

First Tap the Collective in DC a Success

I'll give a more detailed recap in the next couple days, but last night we co-hosted an event in Washington, DC last night called "Tap the Collective" where we brought together the "do'ers" behind some of the more interesting collective intelligence projects going on in Washington. Attendance was fantastic, we got about 20 questions for the q&a, and our speakers, with a 7 minute time limit, each did a great job succinctly explaining their initiatives and some of the cultural battles they're waging internally to increase the likelihood of success.

My favorite quote from the night:

"No one ever retires from NASA; they just die."
- Emma Antunes from NASA explaining what a great place to work it is.

More soon, including video and photos of the evening.

"Groups aren't where ideas are born, but where they come to sink or swim."

from Brainstorming Reloaded | PsyBlog

"Experiment after experiment has shown that people in brainstorming sessions produce fewer and lower quality ideas than those working alone (Furnham, 2000). Here’s why:

1. Social loafing: people slack off to a frightening degree in certain types of group situations like brainstorming.
2. Evaluation apprehension: although evaluation isn’t allowed in a traditional brainstorming session, everyone knows others are scrutinising their input.
3. Production blocking: while one person is talking the others have to wait. They then forget or dismiss their ideas, which consequently never see the light of day.

So if groups need to generate new ideas, new connections between old ideas and new ways of seeing the world, how should they proceed? The answer is that brainstorming needs a tweak.

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Also it emerges that groups do have a natural talent, which is the evaluation of ideas, rather than their creation."

- found on http://hitenshah.name/

Resorting to violence

From a note we just received asking how to handle a sticky situation in a market:

"...Should I refund these options? The participants on this market have been getting antsy (rightfully so) and would probably burn me at the stake if they could for taking so long to figure this out..."

To all those people who question if there is incentive to participate in a play money marketplace, if people are worried about violent acts against them for not quickly cashing out a market, there's clearly some interest! :)

Tap the Collective Coming September 2nd to Washington, DC

We're excited to announce an event we're co-hosting with the fine folks from the popular blog Transcapitalist in Washington, DC on September 2nd: "Tap the Collective". We've assembled a great lineup of technologists, thought leaders, and do'ers to discuss how collective intelligence initiatives can be used to overcome organizational barriers and operational efficiencies in Government settings:



More information and registration are here: tapthecollective.eventbrite.com

Our event is generously being sponsored by:

Palantir: http://www.palantirtech.com
Boalt Interactive: http://www.boalt.com

New Feature: Correct a late cash out, aka "Cash out a question in the past".

A common problem in prediction markets is:

What if you want to ask a question with no specific closing date in the future?

In other words, you know you can enter any arbitrary cut off time for the question like "the end of the year". But some report or announcement that your question is based on, could come out at anytime with the answer to your question.

And as soon as people hear about it, before the market administrator can cash out the market, now a bunch of people can make free fake money buying up a guaranteed sure thing. The traders end up looking smarter then they actually were according to their balances and winnings, and this question no longer reflects the true probability predicted by your crowd.

Often there's great prediction market questions that fall into this category.

So the team at Inkling came up with a solution to this. You can now cash out things as if they were cashed out in the past, refunding any trades people have made since then, and setting the stock price back to where it was before the answer was publicized and made known to your astute traders.

Here's a concrete example where we had to use this ourselves recently.

Awhile ago, I created the question: "Which of these companies will declare bankruptcy by 2010?" http://home.inklingmarkets.com/markets/17817 But of course, bankruptcy news just gets announced whenever. I couldn't set much of an expiration date on this except for Dec 31, 2009. And I don't watch the news all day long to cash the question out as soon as there's an announcement.

So yesterday evening I received the news Station Casinos announced bankruptcy yesterday. The news had first come out though at about 5PM Central time. So in a short span of a few hours after 5PM Central yesterday, traders had bought Station Casinos up to about $99. It's free fake money after all. They know I have to cash it out at $100.

But now with the ability to cash things out in the past, I can correct this.

I just go to cash out the stock as before, but now there is a link to click to cash out the question at some point in the past.

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I pick the true date and time in the past, just before the answer to the question was publicized to everyone. I made this 5PM Central yesterday, as that seemed to be the earliest news announcement I found.

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And I continue cashing out the question's answer just as before.

So now, anyone who made a trade after 5PM yesterday had their trade refunded, and the predicted price of the stock is reset back to it's value at that time.

We hope this is useful and clears up any confusion on how best to ask questions like this of a prediction market.

"Should we be concerned about people 'wasting' too much time using Inkling?"

A post in the New York Time's Freakanomics blog really struck a chord with me today. And it was actually commentary on a recent Paul Graham post about meetings in companies, so I wanted to share some thoughts of my own.

Because Inkling seems a bit like a game, I am often asked if companies have had problems with employees "wasting too much time" using Inkling and is there a way to have "trading hours" in the application to limit this. (No there isn't and I doubt there ever will be.)

I know why this question comes up - because Inkling is something new and unconventional, but I always privately chuckle at this question because I think back to my days working in a large company and remember how many meetings I sat in. Countless, multi-hour, meetings that looking back, were more often than not, a complete waste of time. So which is worse - spending 30 minutes per week in Inkling where you're efficiently expressing what you think about a wide range of issues, or 2 to 4 hours per day or more in meetings?

Even though I am out of the large company environment, since I am regularly talking to people about Inkling, I still spend a fair amount of time in meetings. As Graham points out, this is pretty disruptive to my productivity and I find I often don't get much "real work" done until "business hours" are over. Talking to friends, they live the same way: meetings all day, come home, eat dinner, then back to work to make up for all the time they were in meetings. Yuck.

I don't think many would disagree that Inkling is a more efficient way of collecting information (especially from a large number of people) than a meeting, but could that actually translate to fewer or shorter meetings?

Take how risk management is handled on projects across any number of industries. Most sizable projects maintain some sort of "issues log" where they identify what the project risks are and what mitigating actions they're taking. Many a meeting are held to discuss what risks are likely, which aren't, and how they should be dealt with.

In Inkling, you're already expressing your opinion on those questions without the need for lots and lots of meetings. And you can update your opinion at any time. In fact, ask about all your major project risks in Inkling and you now have a prioritized list of risks according to the likelihood they will occur:

Question	Chance
Will we meet our deadline to complete QA testing?	18% chance
Will the supplier be able to fulfill the complete order on time?	76% chance
Will the cost/benefit analysis be below the threshold of moving forward with development?	92% chance

Looks like QA testing is in the most trouble. Might be time for a meeting! But at least there is a higher likelihood that meeting can be more focused. This could translate to a shorter meeting time which most importantly translates to more time to actually work on improving the chances that testing gets done on time, or minimally a resetting of expectations.

So can prediction markets reduce the number of meetings? Given today's corporate culture, I would never be so bold to make that statement (be sure to read Paul's full post about some ideas to try, regardless.) But can they increase the quality of meetings by proving valuable, actionable input to what is being discussed? Most definitely.

When Bad Things Happen to Good Projects

I recently came across this 2 year old article on CIO.com about a project at Hewlett-Packard where they were implementing SAP to replace old legacy systems for their supply chain. Migrations had gone fairly smoothly until they got to a much larger department that handled customer orders. They knew this one was going to be a bigger challenge. Before the start of the migration, the project managers did their requisite contingency planning and padded their workplans to accommodate for a few glitches they foresaw with one particular legacy system. Long story short, they severely underestimated those issues and were hit by others they didn't plan for, business operations were negatively impacted, and HP pegged revenue losses at around $40M.

Another anecdote in the article was about Nike:

"Other companies besides HP have faced similar business disasters from relatively small IT errors. Nike, for example, had a problem with a demand-planning application when it switched to a centralized SAP system in 2001. The problem was tamed within a few weeks. But because the company did not have an adequate business contingency plan, the small glitch in IT cost Nike $100 million in revenue."

The article goes on to talk about the need for better contingency planning and a more thoughtful approach that considers the impacts IT snafus are going to have on operations. If you're a project manager, it's all good advice. But having managed several large projects myself in my consulting days, I learned contingency planning only gets you so far. Having a great project manager who is a Gannt chart ninja only gets you so far, having managers from the "business side" involved only gets you so far, having good team chemistry and lots of fancy collaboration tools only gets you so far, having a robust methodology only gets you so far, and even having all A-Players on your team only gets you so far.

So why do so many promising IT projects go bad?

Let's dissect at a very high level how a large IT project is run. The standard operating procedure is to do a lot of planning up front (including formulating contingency plans,) create thorough workplans that are managed throughout the project, create and manage issue tracking spreadsheets, if the project is large enough, set up a "program management office" with several project managers working in concert, set up a team collaboration space for files and dialogue, create protocols for reporting status up and down the project hierarchy, schedule weekly status meetings, and facilitate ongoing communication between different parts of your project team and the business.

That all sounds great, but obviously there's something wrong or else we wouldn't read articles like this.

One key element missing in so many of these large IT implementation projects is ongoing, unfiltered feedback from the project team itself AND from those whose business is impacted by the IT changes. On our projects at Accenture we certainly were never accused of not having enough meetings and documentation (what do you think your millions are paying for?) We used to collect status reports from every person on the team and have status meetings at least once a week. We had liaisons from the business units we were building the systems for and met with them regularly to keep them updated on the project and to hear their concerns. Sometimes they even joined our teams full-time. We had an extensive knowledge base of sample deliverables and project post-mortems. We had collaboration tools and executives coming around to QA the project every few weeks. We had Subject Matter Experts from the software vendors. Any of this sound familiar?

I would argue that you don't have to look much farther for one of the problems with IT implementations today than the ubiquitous "status meeting." You get together in a room with all the "leads" on the project, usually at the end of the week, and talk about how each of your teams are doing. Sometimes you even have the entire project team there which can be 100 people or more. (It goes without saying that no one really even wants to be there.) You highlight things that have been accomplished, what you're going to be working on next week, and talk about the critical issues you're dealing with. A good project manager will ask a lot of questions during these meetings to try and coax more information out of people, and every once in awhile some squirming and squabbling ensue. After the status meeting the project manager may send out notes and an updated project plan reflecting people's comments and how he/she has interpreted their impacts.

But is the project manager really getting the information they need to make informed decisions about the direction of the project? There's a game of self-preservation and chest thumping that often occurs in these meetings that is a filter for everyone's comments. Who wants to look like an ass in front of the people they get evaluated against for promotions and raises? Are you really going to let on that you haven't been able to work through some problem that you think will sound embarrassingly easy to others, or that you think another manager is full of it?

It turns out that us humans are all just a little egotistical, sensitive, jealous, and competitive. Those characteristics are oil in your glass full of project management water.

Meanwhile despite the project manager's best intentions and traditional information collection techniques, signals about milestones that are going to be missed or issues that are going to blow up are not revealing themselves and the project rolls on like a tank in a minefield. A project manager has to respect their "lines of communication" on the project or has to respect the larger organizational hierarchy of the company. They only hear about the big ticket issues, the issues that their direct reports are even aware of, or worse, just the excuses that make the issues sound minimal.

Now you have a project manager, no matter how talented they are, operating with large blind spots because they aren't getting proper exposure to reality. Next thing you know you're getting written up in CIO.com as a case study and your CEO is talking about $40M losses in revenue. Ouch.

What if that HP project had been running a prediction market where their entire implementation team AND people (not just liaisons) from the business units their project was affecting could trade on their project milestones? Or what if the project had taken their list of project issues and put those in a prediction market to understand the probability of them occurring? Or even better allowed people from the business side to ask their own questions about the health of the project and impacts on their operations: issues a project manager could never expect to always be on top of? I suspect HP's talented project managers would have done a lot of things differently if they had access to this new information.

There is no getting around the fact that large-scale IT system implementations are always going to be messy and complicated. Prediction markets are not only an efficient mechanism for providing actionable feedback to the project manager to hopefully avoid many of the issues and lost revenue they encountered, but serve as a credible counter-balance to the fact that we're all...human.