How to figure out what to do in life and business?

By | Life, Strategy

(Extracted from Atomic Habits by James Clear)

At some point, you need to make sure you’re playing the right game for your skillset. How do you figure that out?

The most common approach is trial and error. Of course, there’s a problem with this strategy: life is short. You don’t have time to try every career, date every eligible bachelor, or play every musical instrument. Thankfully, there is an effective way to manage this conundrum, and it is known as the explore/exploit trade-off.

In the beginning of a new activity, there should be a period of exploration. In relationships, it’s called dating. In college, it’s called the liberal arts. In business, it’s called split testing. The goal is to try out many possibilities, research a broad range of ideas, and cast a wide net.

After this initial period of exploration, shift your focus to the best solution you’ve found—but keep experimenting occasionally. The proper balance depends on whether you’re winning or losing. If you are currently winning, you exploit, exploit, exploit. If you are currently losing, you continue to explore, explore, explore.

In the long-run it is probably most effective to work on the strategy that seems to deliver the best results about 80 to 90 percent of the time and keep exploring with the remaining 10 to 20 percent. Google famously asks employees to spend 80 percent of the workweek on their official job and 20 percent on projects of their choice, which has led to the creation of blockbuster products like AdWords and Gmail.

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