A Spreadsheet Way of Knowledge: Ideas That Will Shape Your View of Building Products

A Spreadsheet Way of Knowledge: Ideas That Will Shape Your View of Building Products

In the late 1970s, Dan Bricklin, a student at Harvard Business School, had a revolutionary idea. He wanted to use computers to help him with complex financial calculations for his finance course. The problem with traditional ledger sheets was that any change required recalculating everything. Bricklin saw an opportunity to create an electronic spreadsheet program that would make these calculations easier and more efficient. With the help of his programmer friend Bob Frankston, he developed VisiCalc, the first electronic spreadsheet program, which was released in 1979.

The introduction of spreadsheets like VisiCalc was a game-changer. It not only saved time but also encouraged businesses to keep track of previously unquantified or overlooked aspects. However, what truly fascinated users was the ability to create scenarios and explore hypothetical developments with spreadsheets. This "what if" factor changed not only jobs like accounting but also organizational structures, allowing individuals to make informed decisions based on various possibilities.

This idea of exploring different options and scenarios is a common thread that connects the concept of spreadsheets to the 15 ideas that shape our view of building products. Let's dive into these ideas and see how they relate to the spreadsheet way of knowledge.

1. Start with Why: Just as Bricklin wondered why no one had thought of using spreadsheets on microcomputers before, it's essential to understand the purpose behind building a product. People don't buy what you do; they buy why you do it.

2. Pareto Principle: The Pareto Principle, also known as the 80/20 rule, states that 80% of the effects come from 20% of the causes. In spreadsheet terms, this means focusing on the most critical factors that drive results.

3. Eating Your Own Dogfood: Bricklin and Frankston used their own spreadsheet program to develop and refine it. Similarly, product developers should use their own products to identify and address any issues or improvements.

4. Velocity: In product development, velocity is crucial. Just as spreadsheets allowed for faster calculations and analysis, product development should prioritize speed, moving towards the desired strategy.

5. Second-Order Thinking: Second-order thinking involves considering the consequences and potential outcomes beyond the immediate decision. This aligns with the "what if" factor of spreadsheets, where users can explore hypothetical developments.

6. Reversible vs. Irreversible Decisions: Bricklin and Frankston quickly made reversible decisions while developing VisiCalc, allowing them to adjust the course as needed. In product development, it's important to differentiate between reversible and irreversible decisions, making reversible ones quickly and carefully considering irreversible ones.

7. Opportunity Costs: Spreadsheets help businesses keep track of previously unquantified aspects, allowing them to understand the opportunity costs of different options. Similarly, product developers should consider the opportunity costs of their decisions and prioritize accordingly.

8. Paradox of Choice: Just as spreadsheets provide users with the flexibility to explore various options, product developers must strike a balance between providing choices and avoiding decision fatigue. Smarter defaults and presenting the right options at the right times are key.

9. Inversion: Inversion involves thinking about the reasons something won't work instead of solely focusing on why it will. This mindset allows product developers to identify potential obstacles and address them proactively.

10. Probabilistic Thinking: Probabilistic thinking, similar to spreadsheet calculations, involves using logic and estimation to anticipate outcomes. This approach helps product developers make informed decisions based on probabilities.

11. Do Things That Don't Scale: Bricklin and Frankston manually developed and refined their spreadsheet program before automating it. Similarly, product developers should focus on putting in the work manually to learn and iterate faster.

12. Secure the Beachhead: Just as VisiCalc secured a place in the market as the first electronic spreadsheet program, product developers should focus on establishing a strong foothold in their target market before expanding further.

13. Vitamins vs. Painkillers: Understanding the real pain points and triggers that customers experience aligns with the spreadsheet's ability to address and solve specific financial challenges.

14. Maslow's Hierarchy of Needs: Maslow's Hierarchy of Needs suggests that individuals have a hierarchy of needs, starting with basic physiological needs and progressing to self-actualization. Similarly, product developers should consider how their product fulfills different levels of customers' needs.

15. Theory of Constraints: The Theory of Constraints focuses on identifying and addressing bottlenecks to improve overall system performance. Spreadsheet users often identify constraints and make adjustments to optimize their calculations and analysis.

In conclusion, the spreadsheet way of knowledge revolutionized the way we analyze and make decisions. It allows us to explore different scenarios, identify patterns, and make informed choices. Incorporating the 15 ideas that shape our view of building products into this spreadsheet mindset can lead to more effective and successful product development. Here are three actionable pieces of advice to take away:

1. Always start with why – understand the purpose and value behind your product.
2. Prioritize reversible decisions for quick iterations and carefully consider irreversible decisions.
3. Embrace the "what if" factor – explore different options and scenarios to make informed decisions.

By combining the power of spreadsheets with these product development ideas, we can create impactful and successful products that meet customers' needs and drive growth.