Sunk Costs or Skunk Costs
Skunk Costs, Creative Thoughts, and FeedForward
What does ‘sunk cost’ mean? Sunk costs refer to money that has already been spent and which cannot be recovered. Think about gambling, investments that went sour, and scams that are currently going on via technology. I am using an expanded view of ‘sunk costs’ to include emotions, time, and energy. Left to perseverate, emotions, time, and energy become ‘skunk costs.’ They ferment, smell, and take away from our creativity and positive actions.
Most people have invested money in business ventures that didn’t work out. Many of us have invested emotional resources in students, colleagues, and/or organizations without good results. Many of us have given time and energy to ideas that didn’t seem to pan out. Andy Hargreaves once said, and I paraphrase, that burnout isn’t as much as overload as it is expending tremendous amounts of energy without seeing results.
Unfortunately, the more money, time, energy, etc. we have put into an idea, the less likely we are to abandon it. This keeps us locked in to one solution. Our limited thinking actually narrows our options. We can be our own worst enemy.
Sometimes we look at results and say, ‘this wasn’t worth it.’ Probably true based on feedback. At the same time, if we hadn’t tried something to correct a problem, we might not have learned from the experience.
One idea that may help is from David Richo (2005), “Five Things You Can’t Change.” The five are listed below:
1. Everything changes and ends
2. Things don’t always work as planned
3. Life is not always fair
4. Pain is part of life
5. People are not loyal and loving all of the time
I don’t particularly like this list and have experienced every one of these in my life. So, what do we do when ‘sunk costs’ happen? One option is to brood about it, which takes emotional energy away from doing other work. Another is to be cynical and become a “negative Ned,” putting cold water on every idea you or others express. Yet another option is to bottle your emotions and thoughts. And, sometime in the near future there is an explosion of feelings.
Here’s another possibility–get over it. As my friend and colleague Jane Stevenson used to say to me, when I was pouting over something, “How long are you going to be mad about this?” She knew me well. The sooner I accepted the situation, the sooner I would get into the creative mode and start generating solutions.
Moving Beyond Sunk or Skunk Costs
John Gardner (1990) said, “A leader needs a circle of associates who are willing to be both supportive and critical. Pity the leader who is caught between unloving critics and uncritical lovers.” Not easy when our emotions are running wild. Very important to consider when making critical decisions. Thank you Jane, Art, Diane, and Skip. These are my critical friends and friendly critics. Who are yours?
So, can we move to creating thoughts and actions that might lead to better solutions? YES. In the 2014 book “Essentialism,” Greg McKeown suggests the following using your wardrobe as an example.
1. EXPLORE AND EVALUATE – Is there a chance I will wear this someday in the future?” Then you ask more disciplined, tough questions: “Do I love this?” and “Do I look great in it?” and “Do I wear this often?”
2. ELIMINATE – Clothes are divided into piles of “must keep” and “probably should get rid of.” But are you really ready to get rid of the stuff?
3. EXECUTE – Just as with your wardrobe, you will need a regular routine for organizing. Once you’ve figured out which activities and efforts to keep–the ones that make your highest level of contribution–you need a system to make executing your intentions as effortless as possible. It may be helpful to think of this in terms of the Pareto Principle: 80 percent of the results come from 20 percent of the effort.
Here is the final killer question: “If I didn’t already own this, how much would I spend to buy it?” Anytime you fail to say “no” to a non-essential, you are really saying yes by default.
Think about a solution that didn’t work out even though you put a lot of time and energy into your solution. How long do you stay stuck? Who can help you think about possibilities? What do you read and who do you talk to? Angeles Arrien, in a workshop asked, “Who do you hang around? People who zap you and energize you or people who sap you and suck your energy?”
There is a Maori Proverb: “Never spend time with people who don’t respect you.” Most of us have jobs where we cannot ignore people who don’t respect us. As a long-time principal, you can reduce the time you spend with these people. When I get pulled down, I walk into a classroom and watch a teacher teach and kids learning. Ah, re-energizing. This reminds me why I work in education. What do you do to re-energize yourself when life gives you a negative experience?
McKeown says, “Protect your assets.” The best asset we have for making a contribution to the world is ourselves. If we underinvest in ourselves, and by that I mean our minds, our bodies, and our spirits, we damage the very tool we need to make our highest contribution. Good advice.
Peter Drucker believed that “people are effective because they say no. If you don’t prioritize your life, someone else will.” My definition of a friend is, someone I am glad to see and they have no plan for my immediate improvement. I can just be Bill.
My last suggestion for dealing with ‘sunk costs’ is an idea I learned from Marshall Goldsmith in an article from 2007. Many times feedback has a negative association with being judged. Yes, understanding what may have contributed to the results of a solution is valuable. But the goal of FeedForward is to focus on what you want and how to get there; it means focusing on suggestions for the future; not giving feedback on the past.
We can’t change what happened. As a principal, whether working with staff or community, people want to tell me what they don’t want. In trainings I have told attendees to track how much time you spend listening to people tell you what they don’t want. Your job as a coach, friend, colleague, etc. is to help clarify what they want. If you can’t define the goal, you can’t make a plan on how to get there.
What we do have control over is what we do going forward. Creating possibilities for moving forward is more positive and productive than wallowing in the woulda, coulda, shoulda. Creating actions to take builds momentum to get things moving again. Who helps you be more creative? Who do you spend time with that helps you generate ideas?
Barbara Cartford was a Spanish teacher in a high school when I was an administrator. She came to my office one day and said, “I want 30 minutes of your time.” Yikes. I asked why? She said she needed ideas for her class. I responded that I don’t speak Spanish, I don’t know the way to teach Spanish, and I don’t think I would have any good ideas for her. Barbara responded, “all I know is when we have these coaching conversations I come out with more ideas.” I said, “have a seat.” She is the expert teaching Spanish. Helping her to move forward, I can do. Thank you Barbara for having confidence in me.
Yes, learn from the past. Focus on what we do now. As Lynch and Kordis (1988) said, you can’t control what happens to you, but “you must take responsibility for how you respond to what happens to you.” So, focus on the future, plan with FeedForward, and get moving to action.
References
Gardner, John. (1990). On Leadership. New York: The Free Press, Inc.
Goldsmith, Marshall. (2007). “FeedForward.” www.marshallgoldsmith.com/articles/1438
Lynch, Dudley, and Kordis, Paul. (1988). Strategy of the Dolphin. New York: Fawcett Columbine Book.
McKeown, Greg. (2014). Essentialism. United Kingdom: Crown Publishing
Richo, David. (2005). The Five Things We Cannot Change: And the Happiness We Find by Embracing Them. Boston: Shambala Press