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1-Page Summary of Little Bets
Overview
Why not focus on the little things in life? Over time, they can grow into something big. Hewlett-Packard used this approach when it created scientific calculators; Pixar did so with animation and many others have succeeded by taking little bets.
There are a number of strategies that can be used to make the little bets approach more effective, as well as increase creativity and innovation.
After reading this passage, a person will know that the skill of improvisation is not just something used by actors, which can be applied to any area in life. It also teaches about how an embedded journalist uses creativity to gather information. They’ll learn that being a good perfectionist is important when they’re trying to create anything new.
Big Idea #1: Take small, concrete actions instead of struggling through big, elaborate plans.
MBA students are taught that great entrepreneurs have to come up with a great idea before starting their own business. However, most successful entrepreneurs do not start out with the intention of creating something big. Instead, they begin by working on a smaller project or product and then expand it when an opportunity presents itself. Google did not intend to become so influential; rather, it wanted to improve web searches.
To grow a small idea into something big, you should avoid overly-detailed planning. This will allow you to discover new opportunities and ideas along the way. Bill Hewlett of HP understood this, which is why he made a brilliant “little bet” that turned out well for his company.
HP needed to expand, but there were already established markets with many competitors. So in 1972, HP introduced the first scientific calculator into a niche market even though research advised against it due to its hefty price of $400. The calculator was successful and allowed HP to explore another market without having much competition.
A little bet is a low-cost, quick way to test an idea. If the idea fails, it’s no big deal because the cost was small and you can quickly move on to another idea. However, if the idea succeeds then great!
If Hewlett Packard had tried to change everything in their company, they would have been too scared of failure to be innovative.
Another benefit of little bets is that, even if they fail, you learn from the experience and can do something else. If you try to do something big but it fails, it’s more damaging because you’ve invested a lot of time and resources into making it work.
You’ll see how a little-bets approach is useful in cultivating a growth mind-set which leads to fresh ideas. What’s the growth mind-set? And what are some ways you can come up with little bets? The next section will explain that.
Big Idea #2: Develop a growth mind-set and see failure as an opportunity to grow.
It’s healthy to have ambitious goals. It also helps to be able to abandon bad ideas and move on, rather than stubbornly sticking with them.
Being flexible and open to new ideas is important. You need to be willing to make mistakes in order to learn from them, because making mistakes will help you come up with creative solutions.
For example, Pixar hired Brad Bird to direct The Incredibles despite the fact that his last film was a box-office failure. This is an exception because normally companies don’t hire people who have had failures in their past. However, Pixar didn’t let this stop them from hiring him. They specifically hired him because of that failure and even gave him more resources than he had for his previous project (The Iron Giant). He used those resources to create elaborate storyboards which helped animators focus on the scenes that needed the most work.
