The Halo Effect by Phil Rosenzweig is a profound, if unsettling book, about the realities of business advice.
Who is Rosenzweig? A Wharton grad who spent six years on the faculty of Harvard Business School and is now teaching in Switzerland.
The book may be unsettling to some, especially those who are big believers in formulas for success. Many people want to believe that if they just follow steps #1 through #3 or #1 through #45 or whatever, they’re going to come out the other side with success.
It doesn’t work that way.
Who do we get our success formulas from?
People who are successful of course.
Who do we hold up as examples of what not to do?
Business failures.
Rosenzweig asks: “If that’s true, then what do we do when someone is successful and then fails – without making any essential change to his approach?”
This is a very important consideration because this kind of thing happens all the time.
A few years ago, after being thoroughly disgusted with the crap that passes as copywriting and copywriting instruction in today’s market, I put together my own course on the subject.
My qualifications? I’ve written several letters that have brought me six figures in sales and a few that have even brought in over seven figures. It’s not as impressive as it sounds, but it is a qualification.
One of the things I stressed to the students of that course was that while it is valuable to learn the 500 best headlines of all time and all the other formulas that are taught in the field, at best, the formulas are no more (or less) useful then training wheels on a bicycle.
You learn them to get you started, but the first thing you want to do after you’ve learned them is to throw them away and begin to learn to tailor your sales letter to the product your selling, the audience you’re addressing and the times you’re in.
That’s where significant copywriting success comes from. It doesn’t come from learning and repeating a mechanical, sure-fire formula. How could it? If it were possible to use abstract formulas to create successful letters then a good sales letter would work forever and in every circumstance – and none do. They all “wear out” eventually. Even the best of them.
It’s the same with successful businesses. Today’s high flyer is tomorrow’s loser and in the corporate suite, today’s hero is tomorrow’s goat. Even if they haven’t changed a single thing.
Rosenzweig points out numerous errors in thinking and perception – delusions – that lead business people to waste time, money and emotion on ideas that aren’t worth it.
Two delusions stand out particularly: 1) The Delusion of Lasting Success and 2) The Delusion of Absolute Performance.
Success doesn’t last.
Tastes change. Markets shift. New technology obliterates old technology. And even if you escape all that, people die – and that includes you. It’s called capitalism which one expert defined once described as “the perennial gale of creative destruction.”
Therefore the pursuit of enduring greatness – in business at least – may not be the best idea. Better to focus on winning today’s battles.
The next delusion: “The Delusion of Absolute Peformance” says it doesn’t matter – in business – how good you are, how hard you work, or how much you improve. All that matters is how your peformance is relative to the other players in your marketplace.
Becoming a better person or building a better organization may be an uplifting goal, but what really matters in the marketplace is becoming better than the competition.
Rosenzwieg makes this point dramatically by recounting the truly impressive numbers of a mass retail giant he calls “Qual-Mart.” Indeed the numbers he cited were nothing short of amazing in an absolute sense: growth, efficiency, sales, profits.
It was hard to imagine better ones.
There was only one problem: The company was K-Mart and another company Wal-Mart clocked in an even better performance. The result: No more K-Mart.
What really works? Rosenzweig says nothing. Or nothing works all the time in all circumstances. Right strategy is important as is right execution, but so is luck.
So what’s an entrepreneur to do? What shred of certainty can we cling to if formulas, rules of thumb and beautific platitudes can’t be counted on?
Realize that nothing is certain and your real job is not about “attaining success” but managing probabilities.
Focus on humility in good times and learning in bad times. Don’t take either personally because there are a whole lot of elements of both success and failure that have absolutely nothing to do with you, your efforts, or your character. And take nothing for granted.
There’s good news for Internet marketers in this book. Rosenzweig points out that while not all businesses can be run on a scientific basis (test, observe, replicate) some can and the advantage of being able to TEST business ideas as opposed to having to guess at them (often at great expense) is huge.
Wal-Mart can test something in a few stores, find the best sales process and role it out over its entire multi-thousand store network.
Harrah’s, because its thousands of customers all do a variation of the same thing (cards, dice, slots), can experiment on a small scale too and then adapt the winning approach to its casinos nationwide.
Then there’s us Internet marketerers. We can set up a sales process, watch a few hundred people go through it, test changes and adapt winning approaches to increase our profitability with minimal risk.
A fighting chance. That’s all I’ve ever offered my students and as Rosenzweig demonstrates in his book, that’s the most smart business people ever ask for.
– Ken McCarthy
P.S. For over 25 years I’ve been sharing the simple but powerful things that matter in business with my clients.
If you’d like direction for your business that will work today, tomorrow and twenty years from now, visit us at the System Club.
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