Business

Followers of Seth Godin know of the purple cow.  The purple cow is that thing that stands out as being remarkable; that thing about your business that separates it out and shows itself as outstanding as compared to your competition.  If you pass by cow pastures everyday, eventually you ignore the cows, but if you passed by one and saw a purple cow grazing in the field, that would make you stop, watch and tell others about the experience.  It is remarkable.

I wonder though – what are the management incentives created by trying to achieve the purple cow.  Did Madoff try to achieve a purple cow?  Did Barry Bonds try to achieve a purple cow?  Does encouraging your officers and employees to achieve the purple cow lead to an underlying incentive system of “doing whatever is necessary” to achieve the goal?  Are we indirectly creating an incentive for lying, cheating and stealing?

Bob Sutton recently did an opinion piece for Business Week on “simple confidence”.  His argument is that our society’s collective lust for extreme levels of performance led to all kinds of incompetence and cheating over the last decade.  “The pressure to create a false illusion of superstardom contributed to the meltdown; notably, reasonable and relatively safe returns weren't good enough for financial service firms and their shareholders, so they rolled the dice in dangerous ways that were another kind of incompetence.”

Sutton then argues that a path out of the current mess may be a return to the celebration of simple competence.

In “The Peter Principle”, a 1960’s best seller which is a satiric treatise on workplace incompetence, Dr. Peter asserts that when people do their job well, society cannot leave it alone.  We ask for more and more, we promote the individual as they provide more and more, and eventually we ask for too much.  At that point, the person is doomed to fail.

The Peter Principle states: "In a Hierarchy Every Employee Tends to Rise to His Level of Incompetence."

I wholeheartedly believe in the pursuit of Godin’s purple cow.  I am an owner of three businesses, a business law / entrepreneurial law firm, a legal technology consulting business and a web analytics (SaaS) company.  For each, I want my partners and employees to shoot for the remarkable - for excellence.  But it is an interesting point that Sutton raises.  Does this create an underlying incentive that we don't want?  Does The Peter Principle exist?  Is there room to be remarkable with simple confidence?