The Right Way to Set Goals for Growth: Why Tacit Knowledge is More Important Than Deliberate Practice

The Right Way to Set Goals for Growth: Why Tacit Knowledge is More Important Than Deliberate Practice

Setting goals is an essential part of any growth strategy. However, it is crucial to approach goal-setting in the right way to ensure success. In this article, we will explore the best approach to setting goals for growth and why tacit knowledge is more important than deliberate practice.

When setting goals for growth, it is important to focus on absolute goals rather than vague or abstract ones. Absolute goals are measurable and tangible, such as the number of active users and a decrease in churned users. These goals provide a clear direction and allow teams to take credit for their actions rather than relying on external factors. For example, if a company solely focuses on growing traffic to a lower converting country, they may meet their traffic goals but not their signup goals. By setting absolute goals, companies can align their efforts towards achieving tangible outcomes.

One key metric to consider when setting growth goals is the activation rate, which is the ratio of activated users to total users. To move this metric in the desired direction, teams can either focus on increasing the number of activated users or decreasing the total number of users. By understanding this fundamental principle, teams can strategically plan their actions to optimize the activation rate and drive growth.

While deliberate practice is often touted as the key to mastery, tacit knowledge is equally, if not more, important. Tacit knowledge refers to knowledge that cannot be fully captured or explained through words alone. It is acquired through emulation, action, and apprenticeship. When learning a complex skill like riding a bicycle, for example, one cannot simply rely on verbal instructions. Instead, it is necessary to observe and emulate the actions of an experienced rider until the principles behind those actions are internalized.

The value of tacit knowledge lies in its ability to enable individuals to make complicated judgments and engage in creative problem-solving. It is difficult, if not impossible, to acquire this type of knowledge solely through explanation or explicit instruction. Tacit knowledge allows experts to balance multiple considerations and make instantaneous decisions based on their intuition and experience. By recognizing the importance of tacit knowledge, we can focus on finding ways to gain it directly rather than relying on attempts to make it explicit.

In contrast to deliberate practice, which is primarily applicable to fields with well-established pedagogy, the acquisition of tacit knowledge follows a different path. It involves finding a master in the field and working under their guidance for a significant period. Through emulation, feedback, and osmosis, individuals learn the ropes and absorb the tacit knowledge necessary for expertise. This process can be seen in various domains, such as Warren Buffett's years spent under Benjamin Graham's mentorship.

The field of Naturalistic Decision Making (NDM) is dedicated to exploring ways to enhance the effectiveness of this practice. NDM methods focus on understanding and harnessing tacit knowledge, making it an intriguing and often overlooked topic in the study of expertise. By keeping an eye on NDM advancements, we can gain valuable insights into how to cultivate and leverage tacit knowledge in our own pursuits.

In conclusion, when setting goals for growth, it is essential to focus on absolute goals that are measurable and tangible. By prioritizing metrics such as the number of active users and a decrease in churned users, teams can align their efforts and take credit for their actions. Additionally, recognizing the importance of tacit knowledge over deliberate practice allows individuals to embrace the value of emulation, action, and apprenticeship in acquiring expertise. By seeking out masters in the field and absorbing tacit knowledge through observation and osmosis, individuals can enhance their decision-making abilities and engage in creative problem-solving. Three actionable pieces of advice for effective goal-setting and knowledge acquisition are:

1. Define clear and measurable absolute goals that align with your growth strategy.
2. Seek out mentors or masters in your field who can provide guidance and help you acquire tacit knowledge through emulation and observation.
3. Stay informed about advancements in Naturalistic Decision Making (NDM) methods, as they offer valuable insights into harnessing tacit knowledge for expertise.

By following these recommendations, individuals and teams can set themselves up for success in achieving their growth goals and acquiring the essential tacit knowledge needed for mastery.