We talked to author and Harvard Business School professor, Laura Huang, about her new book titled "Edge: Turning Adversity into Advantage." In this insightful discussion, we learn about how to tweak people's perceptions, turn inefficiencies into opportunities, and change your mindset to make the most of even the most challenging situations.
Lydia: Hi, so we are joined today with Laura, the author of Edge: Turning Adversity into Advantage. Wonderful book, really enjoyed it. We're doing a live Q&A today, so anyway I want to just kick it off and pass it to Laura to introduce yourself and talk about really what inspired the book and got you started on this.
Laura: Yeah thank you so much for having me, and thank you for I mean, what a nice treat for everyone who's joining to get a copy of the book. I am a professor at Harvard Business School, and for the last more than a decade, I've been studying perceptions and attributions in the workplace and in the startup ecosystem. So in studying perceptions and attributions, what happened is that I naturally started looking at a lot of questions around inequality, and stereotypes, and disadvantages, and disparities, and people who are underestimated, and so was doing a lot of presenting of this work and kept getting asked questions around what do we do about this. Are there ways to level the playing field? Are there strategies that we can take to kind of prevent against these stereotypes and perceptions? And what I found was that most of the solutions were very much at the system level, at the structural level. So things like having more equitable hiring practices, or using algorithms to help us hire, trying to get more mentors that are women, people of colour. People are more diverse and inclusive top management teams, but there was very little around what as individuals, we could do. And so this book was really around presenting my research in that area. Things around how do we take the stereotypes that others have about us and flip them in our favour. How do we actually take constraints and obstacles that others are bestowing upon us and actually flip those to an advantage for ourselves. That sort of gives us power and enables us even within an imperfect system and so that's really what this book was about. It was really inspired by people who had asked me like what are the what can we do. So I wanted to present lots of strategies and tactics and how to's for how you could really flip things in your own favor and gain an edge.
Lydia: Now one of my favorite ways that you flipped somebody's preconception of you was when you got an F your first time in your introductory writing course, and you then come up with a somewhat sarcastic second essay. Would you mind sharing that story?
Laura: When I was a freshman in college there was a required course called the university writing course and everyone was required to take that, and so I took this writing course and wrote my first paper, and I got an F on it and I was like what? So I sort of read it and wasn't sure like why I got that. So I asked the professor and I sort of said, well can you help me understand you know where I went wrong here, and he said it's fine you're not a native English speaker, so you'll do better over time, that's the purpose of this course. I was sort of stunned so I didn't know what to say and I was like okay, but I was like sort of a little pissed because I was like what? And then I turned in a paper and it was very tongue-in-cheek, but I very certainly talked about how like I wasn't a native speaker, and how grateful I was for this opportunity to take this university writing course from this professor that was going to teach me English and it was very sarcastic, but the professor didn't pick up on any of that sarcasm at all, and I got a B-minus. But you know, I realized that there wasn't really anything I could do, I sort of couldn’t say like, well I actually am a native speaker. So I sort of shared lots of embarrassing stories in the book around these lines.
Changing Perceptions and Asking the Right Questions
Lydia: Yeah I mean you have more sort of just, you know embarrassing but relatable anecdotes in the book that I've seen in a long time. Everything from just the hairdresser story to the road trip across Texas. I really just enjoyed that. One of the things that sort of stuck out in the book for me, I would love for you to expand upon is you said that, assume the system is not going to change but you can advocate for better hiring practices, with so many of our viewers being business owners and hiring managers, I’m curious like how can people advocate for better hiring practices.
Laura: Yeah okay so I could give like an hour and a half topic but I'll try and be as concise as I can. So the title of the book is Edge, and it's about how do you gain an edge, but the edge actually stands for the framework that I've developed through my research and the different parts of the book. The “E-D-G-E” and I don't actually explicitly ever say that in the book, so some people don't see that but the “E” stands for Enrich, the “D” stands for Delight, the “G” stands for Guide, and the final “E” stands for Effort and hard work. I can talk a little bit about that later. But for your question, that “G” is so critical. Guide. Guiding. It's so important to be able to guide people's perceptions of us because as soon as we walk into a new environment or a room, people are trying to write a narrative about who we are in their heads. About who we are, where we've come from, what traits we have, and so what we really need to do is to guide them to who we authentically are. We need to be redirecting their perceptions. A lot of my research talks about how we actually redirect those perceptions that others have about us. And so a really sort of quick way to make this a little more concrete is that in one of my projects, I find that we get asked different questions and I studied this with venture capitalists and entrepreneurs first. We get asked different questions based on who we are and what we look like, and there are two different types of questions. There are questions that are called prevention focused questions, so questions that are about the risks and the competitors and the drawbacks of something and the contingencies, and then there are what are called promotion focused questions, questions about the opportunity and the vision and how big you could take something. What I find is that based on who you are and what you look like, you're more likely to get either asked prevention focused questions or promotion focus questions. So women, people of color, are more likely to get asked prevention focus questions. Questions about risks and what happens is that if you get asked a prevention focused question, you're more likely to respond in turn with the prevention orientation. So if you get asked a question about competitors, you're going to be answering you're going to be talking about your competitors and the risks. If you get asked a promotion focused question you'll talk more about the vision and the opportunity and how big you can take something. So then at the end of the day, investors will be more likely to invest in those who talk about how big they can scale something and the opportunity. Same with hiring managers, they're more likely to hire the person who is seen as a visionary and thinks large and strategic. What I find is that in order to guide and redirect, that you can actually be attuned to this and if you recognize that you're getting asked a prevention focused question, you can actually stop and flip it in your favor. Where if you're getting asked about competitors for example, you can you answer and you say yes there are a lot of competitors in our market, but what our product is able to do is X Y and Z and that allows us to approach different opportunities and go after different target markets and really expand our footprint and all these sort of things that you can say. What I find there is that not only are you able to level the playing field, you actually are able to get more funding in many instances than otherwise and those other people. So you're actually really creating your edge in that sort of environment and we can also do this to create more inclusive and more equitable practices. If you recognize that you're asking someone lots of prevention focused questions, or even you're not even asking them but they're staying at the very low level and they're talking about risks and contingencies, you can actually ask them things around well “where do you see that going from here?”, or “what's your long-term vision?”, and then alternate the ways in which you engage with different people. So that's just one example but I give lots of different examples of how this kind of works in terms of guiding and redirecting.
Creating That Edge
Lydia: Yeah I think that's a great point of just how hiring managers could also be more aware of what questions they're asking to ensure that they are you know not just starting it off on the foot of putting people on the defence and you know the prevention attitude. One of the questions that came up in the chat is, can you actually create edge, or is it more about being aware of opportunities that present themselves and then taking advantage of them?
Laura: Yeah so you absolutely can create your own edge and you can be aware of the opportunities. So it's both - it's the first and the second. So the piece that sort of, so in terms of creating the edge. I’ll take that piece first and it kind of relates to what you're saying about how you do this. When you guide and redirect perceptions you do this in a really benign way. I'll give you an example another example of some of the work that I've done on, for example accents. People who have accents are less likely to get promoted, to get raises, to get hired in the top management teams, to get funding for their ventures.
I see lots of these disparities and we often assume that it's about communication, but I found that it's not about communication at all, because I did multiple studies where I had some people with accents, some people without accents, and I randomized the order in which they presented to investors. And I asked them not whether or not you would invest in that person, but give me three bullet points of what you remember from what they said or three things that you learned or what do you recall from this presentation. And they learned just as much if not more from those with accents and they didn't know I was sort of doing this. They didn't know the rationale behind it but what I found instead was that there are underlying perceptions that people have about us. So if you're an accented individual, those underlying perceptions are things like how much interpersonal influence do you have, how good of a team player are you, how creative and how much do you think outside the box, and so those underlying perceptions. What I then did was I had people with accents, before they went into for example an interview situation, I would say the underlying perception they have about you is that you're not as interpersonally influential. And so then they would get asked those normal sorts of questions like, oh tell me about a time when you know, and I would hear them saying like astonishing things like, "Let me tell you about a time when I fought for resources for my team," or "Let me tell you about a time when I didn't quit like till I closed the deal." And they're giving all these examples of when they were interpersonally influential and a team player, and not only were they rated higher in terms of things like interpersonal influence and being a team player, they were rated higher in terms of communication and they were much more likely to get the job. Same thing with gender race ethnicity and with ageism, I found that there's one underlying perception. We assume that it's about things like technological proficiency, but it's one thing. It's curiosity. That we assume older employees are not as curious. So I do the same thing: I say before you go into this interview, the one perception that they have about you is that you're not as curious. And then I hear them saying things like, "I'm curious about your strategy and how it's evolved over time." And not only are they rated higher in terms of curiosity, they're rated higher in terms of technological proficiency, and they're more likely to get the job, the raise, the promotion, the funding - all these things. So you're flipping these perceptions, but you're doing it in a really benign way. That's how you actually create your edge. You hone your ability because the key is knowing what is the underlying perception that people have about you, and that differs based on who you are. But once you know that, you redirect people's perceptions towards that, so you don't go in saying like I noticed because I'm a woman that you think XY and Z, or I know it's because I'm older that you think something because that's just going to cause defensiveness. That's when people sort of say, like "Oh no, no I would never think that," even if they are thinking that. But when you actually redirect and guide, that's when you're able to to create that edge, and when you create that edge and you continuously sort of do that you, you continue to develop this awareness of these opportunities and that's the “D” piece. That's the “delight” piece that I talk about in terms of how you actually understand the opportunities that present themselves and then take advantage of them.
The Ten No's
Lydia: And you know I love what you mentioned awareness, I think the hardest part of doing this is you have to have awareness of people's perceptions of you. How can people get better about understanding you know that for instance if you're older, people think you're less curious. How do you know what all of these judgments are?
Laura: Yeah so that's like a huge piece of this right, it's almost like you're honing your intuition but you're really honing your ability to know in any situation how people see you. It's really tricky because you change one variable, like you change the industry that you're operating in, you change the mix of people that you're engaging with, and those underlying perceptions may change to some extent. So I talk about a lot of different strategies and tactics and ways that people can actually do this. I'll give you an example of one of the practical sort of exercises that gives a sense for how this is, something that I do with my students actually, and it's called the Ten No's exercise. What they have to do is over the course of one week, they have to get ten people to say no to them, and what they have to do is they've to write a short paragraph about each of those “no”s and come ready at the end of that week to present one of those “no”s to the class. What is astonishing about this and the power of this is that they discover all sorts of things, because the thing is we're so used to wanting people to say yes to us, we're so used to wanting people to agree with us and like us and say yes to us. So whenever we interact, most of the time we are interacting and we're using tones and styles and communication patterns, and in a way that's trying to get people to say yes, and get people to like us. But when the goal, when the assignment is you have to come back with ten “no”s, you start to notice things around you like who are you asking and how are you interacting with them and are you interacting with different people in different ways and what sort of style and tone are you using with them and are they using with you, and how are you perceiving them and how are they perceiving you. You start to see all of these nuances that you never saw before, because your whole life you've been building one muscle around getting people to say yes that you really don't see you don't have that insight into that these other dimensions. So you realize all these kind of things around perceptions and how you're kind of being viewed. You also realize that people are much more willing to say yes than you think. I've had students come back with tickets to the Super Bowl, one student came back with one free week in a summer vacation home in Bali, like all of these sort of astounding things. But you really recognize, how do you start to see and how do you start to shape the way in which you continue to hone how others see you. And so I have lots of different stories and exercises for how you can do this, and just the ten “no”s is just one example, but there's lots of different questions you can ask yourself and I also have a companion guide to the book which is free. You can download it off of my website, laurahuang.net, which is all practical tips and exercises, and these sorts of things that you can do to hone your ability to see how others perceive you. These are all things that we couldn't fit in the book. lt has tons of like exercises and some of it is just like reflective questions to ask yourself to become more aware.
The Importance of Awareness
Lydia: I think the more you can be aware, it's just so helpful. I remember taking Myers-Briggs, which you talk about in the book. The first time I took that and started to really dig in, I realized all of these issues or frustrations I have had in communication in the past, I'm an INTP, so very similar to it you talk about your husband's a ENTP and like the thinker. You know where you're thinking, you can have these debates with yourself and you're totally fine with it, and the other people are just like, "What are you doing?" So you have to become more aware in order to understand how you're being perceived by other people.
Laura: Yeah I think it's really important not just for us to have an awareness of ourselves, but also as leaders of organizations. I mean a lot of organizations that I work with, they're sort of like, "Well what's the ROI on this?", like "What is the financial goal?" But this is so relevant to leaders of organizations, because one of the things we struggle with is that employees are team members, the people that we work with. We all sort of want to make an impact but a lot of leaders feel like they're sort of pushing the same lever over and over again. And this is really when you feel empowered as an individual, that's when you're much more of a productive employee as well. When you feel like you're able to enrich and provide value. And so leaders who can encourage this in their people, and leaders who can kind of see that empowering their employees to gain their own edge are ones that are going to have a much richer and much more impactful organization. And so it's not just about redirecting how you yourself behave, it's also about using these tools to redirect and understand how those you work around.
Breaking down the EDGE
Lydia: Yeah there's a question in the chat right now. You were on the hiring side, you're responsible for making decisions on who to have joining the organization. How do you become more aware of those underlying perceptions and undo them so to say?
Laura: So that this really speaks to the “E” piece of the book, we’ll all talk about really quickly now since I have alluded to it multiple times. So the “E” stands for Enrich, which is how you enrich and provide value in any sort of circumstance or situation where you're in. And not only that, it's the perception that others have of how you enrich and provide value, so that's going to differ based on the context. As individuals we sort of have our own basic goods. We have our superpowers, but how those are perceived is going to change based on the circumstance that we're in. And the other problem with how we enrich and provide value, is that oftentimes we don't have the opportunity to do so, because sometimes we don't belong to the right network, so we're not giving that opportunity. The “D” stands for Delight. It's about delight when you're able to delight your counterpart. It's really the equivalent of cracking the door open a little bit, so that you have the opportunity to show how you enrich and provide value. It can be a first impression that was wrong, and now you've made them pause for a second and say like, "Oh, maybe I was wrong about it." Or it could be something you've known for ten years and they're now reconsidering some element or something that you've done. So the “D” is really important, and then the “G” stands for Guide which is what we've talked a lot about already. It is like guiding and redirecting, because even when you enrich and delight, you still need to continue to guide the perceptions of others. And then the final “E” stands for Effort. Effort and hard work, and it's last in this framework. THis is really critical because we often think that hard work comes first, then if you put in the hard work, that hard work will speak for itself. But in fact hard work comes last, because if you know how you enrich and delight and guide, that's where your hard work actually goes much further for you. The problem is that we have such a love affair these days with like hard work and grit, but the problem is that we all sort of deep down we know that like a lot of times hard work leaves us frustrated. Because you put it in the hard work, and then the outcomes go to somebody else, or like you take two people who work equally hard, and one person gets the outcomes, and that's because outcomes are not driven just by hard work. They're driven by perceptions and stereotypes and signals and cues, and so on. This question around like hiring and being responsible for making decisions, it's around being able to see the basic goods. How people enrich, which dimensions do they enrich, how do you sort of understand the strengths, the underestimated strengths, and weaknesses. Are you giving them opportunities to delight and are you giving them opportunities to really guide the ways in which they are seen, to be enriching and providing value. And so I talk a lot about sort of the power of light and how that really opens doors. When you give these opportunities, these sort of improvisational non-planned ways of allowing people to delight, they just sort of open up and really enrich and provide value in so many different ways. And not only become aware of these underlying perceptions but are able to counter them in very different ways and so you know the “delight” piece is really important.
Lydia: Yeah I love just the idea of focusing on effort last and flipping that. And you know this question about how you can you do this within your organization, one thing I remember a manager doing is they started everyone the first day, created their operating manual. We do something similar with everyone, we put together a presentation, like here are some things about me. But I really liked that there was one question in the operating manual that you know I've used time and time again at organizations, which is what are some misconceptions about you? What might people misunderstand? And so before you work with anyone, you actually have to list out a few of the things that people might misunderstand about you and write you off. And it's a way of basically putting this front and center, and saying I am aware of this, so that you can start off on the right foot before you are putting in the effort.
Laura: Yeah I think that's something that could be used. I love that because it's also something that over time you can revisit. Because the current way that we do things, like we do 360-degree reviews and annual reviews, but there's so much that shows that those are not very effective on multiple dimensions. We sort of go through this exercise of up-down lateral, but you know a lot of times, people don't take them seriously. It becomes a burden, we start to copy and paste, and then just change a couple of things. I mean like these are so that kind of thing where you're actually getting authentically at the crux of these perceptions and attributions. That's really great.
On Beneficial Constraints
Lydia: Yeah that makes a lot of sense. Another question that came through is: if adversity is what gives you an edge, how can somebody be a good leader if you aren't creating adversity within your teammates or your teammates don't have an adversity that they need to overcome?
Laura: So I think I'm interpreting the question around like constraints are good to some extent, which I talk a lot about, like this is not to say that constraints and obstacles are not always good. What we're really trying to redirect and guide is those stereotypes or those perceptions about us that are leading, or that are kind of have gone astray, that are not really authentically who we are. And so you're guiding people to who you authentically are. Constraints are good because they allow you to produce, they allow you to kind of stay nimble. Organizations need organizational constraints, but they also need empowered individuals, they need that human capital side to be really engaged. And you know the question that I get when I talk about this, this piece around guiding, is that like it sounds good but it feels really strategic. Like it feels like I'm sort of managing impressions, and I don't really want to be that person that's sort of strategically managing impressions. But what I'm talking about here is actually the opposite of that. You are guiding people to who you authentically are because you know, we've all had that situation where you know someone is like kissing up to the boss. And we're like, we don't want to be that person right. That's not what this is - you are guiding people to who you authentically are, so you can have that deeper, richer connection with your counterpart, so that you're starting off in a way where you see how they enrich and they see how you enrich, and so that you had much more of an authentic interpersonal interaction. The second piece of this is like, you know we also hear this advice a lot: just be yourself. And that's actually just horrible advice, it's horrible advice to be yourself because there's so many different versions of ourselves.
Lydia: Yeah, and no one knows themselves.
Laura: Yeah we are complicated and varied individuals. And so we need to also be able to embrace that like who you are with your mother is really different from who you are with your best friend, and that's really different from who you are with your boss, and that's totally okay. If we think of each person as a diamond, each individual is a diamond, and you have flaws and imperfections and different facets. And you're going to shine differently based on the lighting and the environmental conditions in the room that you're in and the angle at which someone's looking at it. And when you're guiding and when you're sort of doing this, it's not strategic all. What you're doing is you're showing them the angle of your diamond that is going to shine the brightest, and when you show them the angle that's going to shine the brightest, that's when you're going to be able to engage with them in a very much more real and rich way. So that's really what this is about, and so as leaders we also need to make sure that we are enabling our people to feel like they can show that angle of their diamond that's going to shine the brightest. That's what's going to empower them. That's what's going to give them the intrinsic and the extrinsic motivation to to do really big and powerful things.
Thinking in Terms of Inefficiencies
Lydia: Yeah I think the intrinsic motivation is something that definitely takes a long time and a lot of practice to get right. I am constantly focused on that, just as the manager, how can you really build intrinsic motivation and not like squash people's desire by giving them too much work, so it's a thin line. I wanted to just touch on one part of the book that you know just seems so relevant right now. In the book, you wrote that the ability to identify such missed opportunities is about pattern recognition, or being able to connect the dots between all the changes in technology, demographics, social forces, markets, government policies and other factors that play in our lives. And really sort of knowing how to recognize these patterns, you go into that. Obviously right now we’re in a crazy time, with what's going on with COVID-19 there's so many things changing everything going on. Have you seen anyone do this well, in terms of be able to recognize patterns?
Laura: I love the way you're framing this because you speak about innovating and creating solutions, whereas overwhelmingly the narrative is around how do we turn this into an opportunity. And that's sort of the wrong way to think about this because when we talk about opportunities, sometimes it sounds almost opportunistic in this situation. Opportunity is great in general but right now we're going through this really challenging time, and people are facing all sorts of different adversity. And you know every time we sort of get on the phone even, those of us who are really lucky, we almost feel guilty, like "Oh, we're doing fine in spite of everything else." Like all this considered, we're doing fine, we're so lucky, like me feeling almost guilty and saying that we're struggling in something or that we're feeling down or we're feeling it out of it somehow, but people are sort of facing this in lots of different ways. Some are experiencing it physically, some are experiencing it mentally, or emotionally or financially or professionally, and some all of those at the same time. And so you know the title of my book is turning adversity into advantage but the advantage piece here rather than opportunity and opportunistic, the ones that I've seen that have been the most successful are the ones who are thinking about it not in terms of opportunity but in terms of inefficiencies. Where are there inefficiencies that can be sort of fixed or that we can contribute to? Because there were inefficiencies before this right, there were these inefficiencies in our economy and our society and our workplaces, in our lives. And then there are new inefficiencies that were sort of created and some have kind of changed in nature, some have remained the same. And so we're able to think about these patterns and the skills that we bring into something, and our experiences and the things we have. Where are there inefficiencies that we can actually do something about, what are the ones that are going to be sustained, what are the ones that we can look at long term? In my class, I talk about it in terms of s-curves, like we do we map companies in terms of the technology, the market? But what I mean by this is, if you look at something like Instacart right. There was a huge inefficiency where there were delays in getting groceries, because there was a lot more demand. People wanted things delivered now. It's not an innovation, it's not an inefficiency anymore because people who were Uber drivers were becoming Instacart shoppers. And now people are not needing groceries delivered to their houses as much. That's not a sustainable inefficiency, that was a temporary inefficiency that you can sort of tackle. That would be an opportunity, but not an inefficiency for the long term, and so when you kind of shift your mindset in that waym that's where you actually see a lot more of that impact. So I don't know if that makes sense. I'm trying not to be too like too much of a professor and like lecture on like how can we map companies and opportunities on to that, but that’s the short answer.
Lydia: You also have a great part in the book about the 3D printer, the exercise that then you’d do with students. I would love for you to just share that. Especially right now with the corona virus, it's like another way to approach this.
Laura: Yeah, so I mean 3D printing, it has been around since 1983. The technology was actually developed in 1983, but it's only been in the last five years or so that it's really something that we have talked about and know about. And it's much more mainstream but since 1983 it's been there, we just didn't do anything with it for sort of decades. And kind of stepping back here is that our minds are very much used to wanting to get to a yes, wanting people to like us, wanting people to accept us and agree with us. We also are very situated around problems that we then need to find a solution for. So this exercise is when I basically tell the students: you have a machine that can make anything, so imagine your guidelines that this machine can make anything that's the size of a microwave or smaller. It costs you five dollars in materials to make it and you have to turn this into a business. And the only thing is you can't commercialize is the 3D thing itself but it's the product itself that is the business, and they have to brainstorm them and come up with ideas and sort of present it and talk about it. And what I also do is before class starts I write down all of my predictions of the ideas that they're going to come up with. So I write down things like medical prosthetics, jewelry, conference giveaway, sunglasses. And so I write down everything that I think that they're going to say, and then after they present and put up all of their ideas I reveal what I pre-wrote. And we find that there's like tremendous overlap and then I ask them the question: why was I able to predict with 90 to 95 percent accuracy what you are going to say? It's not because you're not creative, because we've done so many creative sort of exercises and things. There's a couple of different takeaways that we get there, like number one again is that we think about problems in search of solutions, not solutions in search of problems. Also when we are doing patterns, we sometimes will do very linear patterns, and then we don't think about the overlap in terms of people's knowledge. And we sort of think not in terms of we look at the intersection rather than the union, and so we talk about that piece of it, and we talk about all the different ways that we of think about pattern matching and opportunities and inefficiencies and what that means. And so it's just another way to kind of enhance our intuitions, a way for us to enhance our thinking and hone our ability to understand our own perceptions and our own tendencies. So that we can spot those opportunities, so that was one of the questions right - before it was like, can you create an edge? And is it about spotting opportunities? It's both, it's both of those pieces.
Making Hiring Decisions Based on Soft Data
Lydia: Yeah that's a great point. Another question that came in through the chat is, how can you convince people that you have the skills to do a job despite the lack of visible proof in the past? And there's an example is that you they run a data science consulting organization, they've done a few projects but they don't have enough proof that's out there.
Laura: Yeah okay so I'll start with like one thing that I have researched and then I'll tie it back to this sort of proof piece. Like if we look at if when people are looking for jobs and we look at the job requirements, they are like the job requirements really don't mean a lot in most instances. Like if you've ever written a job requisition or something, people don't know what to say, so you go and you look at what other jobs have written and you copy and paste. And you're sort of like, so everyone wants him who's detail-oriented and good with people, and thinks outside the box and preferably has a degree and maybe even an MBA…
Lydia: And preferably did exactly this in their last role hence require less training.
Lydia: Exactly, so like those don't really mean anything. And then when you look at that like, oh yeah I feel bad, we only fulfill like three or four of this. And so we don't apply, but when you're actually hiring, you don't have that same checklist in most instances. And so we tend to take hard data and think about making decisions based on hard data, even though we're really using soft data to to make those decisions. So let me give a quick example, and then I want to tie it directly to this question around the science organization. OMy first job out of my MBA program, I worked in investment banking, and I've had a number of different careers over my lifetime mainly because I don't know what I want to do when I grow up. But when I was in Miami, I had tons of student loans to pay off and so I asked all of my classmates like what's the quickest way to pay off student loans. And they all were like, "Well, go into i-banking." This was a really long time ago, but I didn't know what I think it was, and I even turned to one of my friends and I'm like, "Wow this internet banking thing is really big these days." I had no idea that the “I” stood for investment banking. But anyway, I went into investment banking and my very first project, the VP said we're doing this mergers and acquisitions deal and our client the customer is trying to figure out who to acquire: target A, target B, or target C. And so we need you and your team to go and create an economic model, a model that tells us whether we should go for target A target B or target C. So we spent two months on this model with all different states of the world, with different interest rates, and modelled all these sort of things and we come back and we present this model, we say you should go with Company B. B is the one you should acquire, and here's all of our assumptions. I'll never forget this: the VP was like, "This is an amazing model, everything's in here that we want, absolutely phenomenal job. However, we already decided that we're going with target A, so can you now redo your model to make it say company A?" And I'll never forget that because we do this all the time. We already make a decision and then we post hoc rationalize and gather all of the information to justify that decision that we already made. And this is sort of the same thing with hiring: we post hoc justify who we wanted to hire based on some credentials that we pick out of that person. It's sort of we pick out details and how do we go about convincing people. You feed them those details, you give them those details that are going to make them make that decision, that they're later going to say, "Yep that's what we wanted to do anyways." And you do that and as companies, as startups, what I see and what I teach in my entrepreneurship class, is that when they're putting together a pitch deck for example, they all like go to these articles that are like here are the 10 slides you must have in your pitch deck.
Lydia: Yeah,like the linked one.
Laura: Yeah like, start with the problem then go with the size of the market, then talk about competitors, and talk about your team. The problem is that there's different products and services, and you need to feed people, you need to be starting this conversation, you need to be delighting them in a way that's giving them something that they're going to pick up on, so that you open the door for you to show them how you enrich and provide value and you do that by understanding like if your product is a water bottle. And a lot of times you lose your audience because you talk about how complex this is and the technology and how impressive and all this sort of thing, and the investor who doesn't want to look stupid will ask a question about one little thing that he or she understood, and it'll take you on this complete tangent and then you leave that pitch feeling like, "But that's not what my company is about." Right there you need to simplify, you need to make sure that they understand exactly what your product is. Dumb it down so that they're delighted, and then I promise you they're going to ask you about like how robust is this, tell me about the technology, all these sort of things. Right whereas if you have a really simplistic product like a new water bottle, like we all get what a water bottle is like, we know how it works, you don't need to spend a lot of time talking about the product. Ahat you need to do is convince us why we need a new water bottle. Why the existing ones are not enough and why this is totally going to disrupt the way things work. And so when you think about it in terms of your own self or your own organization or your own product or service, how do you actually create that instantaneous sort of reaction where they stop and pause and consider you in a different way, and want to then engage so that you can again show how you enrich and provide value.
Leveraging on Inefficiencies
Lydia: Yeah that's a great point and into the water bottle example, I love in the book when you chatted about Camelback and how that came about, just you know solving your own problems. And I think that that's always something when it comes to startups that people are solving their own problems. And right now there are a lot of problems, so I think we'll see a lot of startups come out of right now, but yeah I want to give an opportunity for other people to submit questions if anyone has any in the last few minutes otherwise I had a few questions that people pre-submitted. One was what are HBS students working on to tackle COVID challenges right now outside of healthcare, so I think yeah just innovations that you've seen from your students or discussions.
Laura: Yeah so really interesting things coming out. So there's some that are doing more services to sort of matching demands right, so kind of looking at this matching process between people who need services and people who can provide services, so that's sort of I'm seeing a lot of companies that are doing that. This is what I mean by inefficiencies right, if there's if there's an inefficiency in terms of the amount of demand and supply, that's where you really can capitalize. Another example is like commercial real estate right now is really suffering, so there's some companies that I'm sort of seeing come out that are approaching and looking at commercial real estate and real estate in general. There was a student of mine who again, speaking about inefficiencies before COVID hit, was working on this fascinating thing where she realized that commercial real estate often has really long rental periods. So people will run something for like seven years, ten years - and what that means then is that it's great while it's rented, but if it's not then there's like sometimes a one or two year period or longer because people will take longer to make their decisions. They need to look at the space and see whether it's going to be right for their restaurant or their business, and so the landlords are sort of losing out on 1 to 2 years of rent as they're trying to get that longer-term lease. So she was starting this thing where the landlords would actually give her that space for the interim while they're still showing it to the people who were longer-term leases, but she would rent it out to pop-up shops that would maybe only need it for like a month or three months to kind of get their business launched and try out something. And so this is an inefficiency right, that there's certain companies that needed retail space to just test something out or try and start getting their sales, and then they could afford to have more of a permanent space. And then there's these large retail spaces that were very much empty and so the public shops would get it at a massive discount because they would agree to be allowed to show it to people who wanted longer leases. This is that type of inefficiency that I'm talking about and now she's sort of taking this forward and thinking about how in a COVID environment, what can we continue to do. I'm seeing companies like that, and then I am seeing lots of companies around, there's some that are looking at like regulatory risk around COVID, there's some that are very much healthcare related but lots of really cool things that are coming out but it's challenging because there's also students who had existing companies. And they're trying to figure out whether to pivot, how to stay afloat, what it really means. I had one former student who lost 13 million in committed funding overnight and so had me sort of weather that storm.
Lydia: Yeah I've seen that happen to quite a few startups I thought they were going to close their round and haven't. It's a really difficult time right now, I think every company I know that's succeeding and you know thriving right now made a pivot.
Laura: Yeah e-commerce where they have already had a program.
Lydia: We're seeing a lot of pivots, even just with what Workstream does. It's a hiring platform, we really pivoted from, "Oh, people no longer have as much of an issue getting more applicants." Like that's not a problem with unemployment high, so sort of quick like, "Okay, we need to focus more on how can we save businesses money and really like how can we get them more tax credit and also help them really quickly do like the video interviewing, and the video training and maximising savings instead of all about finding candidates," but yeah.
Laura: Yeah and I think Workstream has a really interesting thesis because you guys to some extent really get the fact that it's about perceptions and signals and these sort of things so yeah.
Lydia: Yeah when we actually see it that happen all the time just because of how people are using the platform. But yeah anyway, it was great chatting with you, unless there are any final questions, I guess I wanted to just really recommend Edge. All of our attendees for the live video are going to receive a copy of the book, and then maybe you could just share again the additional website that they can go on.
Laura: Yeah, so my website is laurahuang.net, and that's where you can get more resources. There's a quiz you can take to figure to find out how equipped you are to kind of gain and create your edge, and you can download the sort of free companion guide to the book that Lydia is speaking about. So thank you so much, it was really a pleasure chatting with you.
Lydia: Thanks guys, get the book, we'll talk to you soon. Thanks again Laura.
Laura: Thanks bye bye.
To sum it up: Author Laura Huang shares how to gain an E-D-G-E, using different strategies to put yourself in the best light, adapt to uncertain situations, and see inefficiencies as opportunities to do better.
Lydia Fayal Hall is Head of Marketing at Workstream. She previously held leadership roles at OneSignal and Chalkup, acquired by Microsoft. Lydia has written for publications including The Wall Street Journal and Forbes. She is an alum of UPenn, Johns Hopkins, and YCombinator IK12. Originally from Stonington, CT, Lydia now resides in San Francisco, CA with her Australian Shepherd, Indy.