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When your returns are diminishing

'The Plateau Effect' offers solutions to people and companies who feel that they are stagnating.

May 31, 2013|By Trisha Andres

You could call it being stuck in a rut. Or, as the authors of a new book put it, you could say that effort follows the law of diminishing returns, eventually causing people and companies to reach a point of stagnation where marginal returns disappear.

In "The Plateau Effect: Getting From Stock to Success," Bob Sullivan, an NBC News columnist, and Hugh Thompson, a math professor and IT security expert, argue that they have found a cure for this condition. They call it "constant recalibration," or always rethinking your approach to problems.

"Plateaus are a sign — a tangible warning — that your life, your relationships, or your business is clogged," they write in the book published by Dutton. A plateau "means you have stopped growing. It means your mind and senses are dulled by sameness."

To explain the idea, the book transports readers to the Stinking Rose, a garlic haven restaurant in San Francisco with a menu that includes garlic spaghetti and garlic ice cream, and an aroma that crowds out your sensory faculties.

Once seated, however, something incredible occurs. You suddenly stop noticing the garlic and your normal sense of smell returns. Although the body's ability to adapt is a crucial element of evolutionary design, this kind of "acclimation" is also the origin of complacency — the bête-noire of so many motivational books.

The authors write in clear, engaging and sometimes irreverent prose as they dart across case studies from Amazon to Zappos.

Part personal development manual and part business book, "The Plateau Effect" identifies and offers remedies for eight types of plateaus: immunity (closely linked to acclimation); the "greedy algorithm" (picking the best short-term solution while ignoring the long-term outcome); and bad timing (executing things at the wrong intervals).

Also: flow issues (problems encountered just when things seem to be sailing along); distorted data (measuring the wrong things or incorrectly assessing risk); distraction (falling victim to the illusion of multi-tasking); failing slowly (forging ahead even in the throes of a plateau); and perfectionism (procrastinating because it is never the right time to start).

Many of the solutions offered to these problems seem like sound enough advice but are also decidedly down to earth: do less, not more; take a break; listen; and set deadlines to counteract procrastination.

The writers are perhaps at their best when examining success through the lens of case studies.

There is the Denver pizza restaurant that turned over its premises to a start-up coffee and biscuit shop in the mornings. This halved its rent and gave it access to crossover customers in a way that would not have been possible if it had simply relied on incremental investments to yield incremental gains.

The authors also show how remedies such as "accelerating failure" can work by citing the example of Jeff Hawkins, the founder of Palm Computing and Handspring.

Zoomer, his first product, was an "epic fail." Using customer feedback from that failed device, Hawkins crafted a prototype out of wood and a chopstick, and carried it around with him for months, constantly testing the design. He was thus able to identify faults and correct them — and from his experiment, the PalmPilot was born.

One could quibble with some of the examples. For instance, tenacity is the more obvious lesson to draw from Hawkins' experience. Meanwhile, the darting from psychology and mathematics to science and sports to explain the plateaus we encounter in business and life is, at points, dizzying.

Nonetheless, "The Plateau Effect" is, on balance, a stimulating read, offering some inventive theories and solutions.

Trisha Andres is a contributor to the Financial Times of London, in which this review first appeared.

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