Get Good at Getting Good
Given enough time, all skills fade into irrelevance. The efficient weaver was easily displaced by a fool with a loom. The diligent farmhand was uprooted by tractors and machinery. The intelligent, fast-fingered computer was replaced by, well, the computer.
Any skill thought to be the most valuable at a given time will become the highest-value domain for innovators to pursue and provide more scalably and cheaply. With no certainty about the skill set needed to be successful at any given time, and with the constant risk of technology making that skill irrelevant, the only skill always worth learning is the ability to get better.
The highest-value skill, therefore, is the ability to compound.
Those most able to efficiently utilize resources to adapt and excel, no matter the zeitgeist, will be the ones who reach the top of their domain and stay there. The tricky thing about compounding is that it cannot be seen in real time. The very nature of its effects requires time to pass. The more time that passes, the more significant its impact.
If compounding is the most powerful force in the world, but it can only be observed after it has occurred, how can you optimize it to maximize the benefit it can have on your life?
First, it's important to understand that compounding is natural. It is not something that can be turned on or off. Throughout history, in nature, physics, and finance, it is clear that those with more find it easier to get more, while those with less find it more difficult. The machine is already turned on and ready for you to use. All you must do is figure out the ways to make it go in our favor, focusing first on compounding positively, and then on compounding at increasingly positive rates.
Do everything you can to get on a positive growth trajectory. Compounding goes both ways. With a positive trajectory, it can be your greatest asset. With a negative trajectory, it can lead to a death spiral that is nearly impossible to escape. This is all too common, especially in times of tragedy. One bad event leads to a string of poor decisions and events that create nearly unrecoverable situations. Before focusing on growth, ensure there are no risk vectors that could cause such a spiral. If some are already in motion, focus single-mindedly on curtailing them before returning attention to growth.
Carefully select where you focus, and do not overallocate your time to things that provide a suboptimal return. Growth is binary. You are either growing or shrinking. But the degree to which growth occurs can vary wildly. Finding an opportunity that provides consistent positive growth is amazing, but getting married to it is a mistake. Being willing to drop existing opportunities for others with higher potential growth is necessary to maximize the impact compounding can have. Now, I'm not suggesting that your focus should change every day. These endeavors should be large and impactful enough to warrant a longer window of focus. But when it becomes clear that the trajectory you're on is not growing quickly enough, or there is an obvious opportunity to grow more, what you're doing should be dropped instantly and without emotion in favor of the new frontier.
Don't just let your winners run. Double down on them. Life-changing opportunities do not come about every week, month, or even year. Though you should always be searching for the next opportunity, significant ones may not frequently appear. This highlights the importance of stepping in early and boldly into new domains where the most growth can be found. Hedging your bets or holding back too much from fully exploring an opportunity may feel like the safe option in the short term. You avoid the risk of overextending yourself, and if the path isn't what it appeared to be, returning to normalcy is easier. In reality, the biggest risk we all face is the risk of never trying something bold. Mild positive compounding comes to those who merely eliminate their downward trajectories. The true power of compounding is not only its ability to grow a little into a lot, but its ability to grow a lot into even more. Taking a bet with a 10 percent probability of success but a 1,000x potential return turns out to be the wrong decision nine out of ten times. The issue with this thinking is that it prevents any attempts at a 1,000x return, despite the positive expected value. Realized failure is an indication of making the wrong decision, but not an indication of having the wrong framework for decision-making. So long as the feedback loop is sufficiently fast and the opportunity is sufficiently large, taking massive, calculated risks in ventures with high expected value is always worth it. Failing once, twice, three times, or more is irrelevant. As long as your framework for decision-making is sound, and you pursue each opportunity with full commitment, you will inevitably find success.
Optimizing your compounding can be done with ease. Once your progress is compounding, focus on how to increase the growth rate of that compounding. Once that is set in motion, aim to compound that growth rate again to achieve even faster acceleration. Observing the first, second, and third derivatives of your growth allows anyone, regardless of their starting point, to find pride in progress and identify new ways to continue growing. If your growth rate is negative, focus on slowing the rate at which it declines. Be proud that the speed of your decline is itself declining. Similarly, if your growth is already positive, you can take pride in it while also working to increase the rate at which it improves.
This shifts your life from a static game of stepwise improvements to an infinitely scalable game of growing growth.
The challenge with this framework lies in defining growth. It's not always obvious what growth looks like at any given time, and it can be nearly impossible to measure in the short term. But like many things, you know it when you see it. When comparing where you are today to yesterday, last week, last month, or last year, where are you now? What are you capable of today that you weren't before? What contributed most to that progress? And given that understanding, is what you're currently working on likely to produce similar results?
Assessing every action based on its potential to compound, and finding joy in actions for their long-term payoff rather than their immediate benefit, is the key to harnessing compounding effectively. Don't think only about the benefit waking up on time brings today. Instead, consider the long-term impact of the extra work it enables you to do each day over years. Ignore the minimal immediate effect of doing 100 pushups once, and think about the potential transformation from doing 100 pushups every day. Habits are often considered long-term behavioral changes, but in truth, they are simply daily decisions to choose one action over another.
Reorienting your thinking to consider the benefit of a behavior when compounded, rather than in isolation, will naturally lead you to prioritize the things that bring immense long-term success over short-term pleasures. Adopting the belief and living life as though everything compounds forces you to eliminate what hinders your growth and focus entirely on what maximizes it.