Compound Interesting

Compound interest is the interest earned on interest, and while this is generally applied to the effects it has on money, it can also apply to other parts of life that supports the adage where the, the whole is greater than the sum of the parts. It is about taking small steps and maximizing impact of each, making the outcome more valuable. But, there is also something to note, as the impact might be reduced if there is a big bang release, without visibility on the steps to get there.

I was reminded of this today at work, where I run a cadence of monthly steps with Sales Teams, each focusing on a skill area adding up to a sequence of development to empower their results. These smaller chunks of development have standalone value too, which means that they are able to use them immediately and improve and iterate, as well as get benefits in the interim, but the maximized value is when all the parts are applied together to compound against each other. Training them as a group however, would mean each component wouldn't be developed to as high a standard, reducing the impact of each and creating bottlenecks in the weakest pieces.

However, I was also thinking about this in terms of building an account on Hive, where there are the obvious financial processes of compound interest in play. For example, there is the 20 percent HBD annual return, meaning that it will take about 3.5 years to double the principle amount. 100 becomes 200, and 3.5 years after that, it is 400. That is a 400% increase in 7 years.

But of course, that is based on a principle amount of 100 and on Hive, that is not the only way to invest, because time and effort can provide additional inputs. These are the small steps that create the greater whole and just like compound interest, consistency in continually stepping is valuable - but it isn't only valuable in the economic sense.

Being a consistent contributor also provides a raft of other personal values too, improving our delivery abilities, knowledge, mindset, understanding and expanding our experience. This in turn adds additional value to what we are able to deliver, meaning that the audience is also benefiting, as our quality increases, as does the level of interest, especially as relationships continue to develop alongside. These things (and more) compound together to build our persona on Hive, our social reputation and therefore, our value as an individual and as a content creator on Hive in general.

If we break this all down into the many individual steps though, the value of each is quite small, but if we focus only on that individual value, we miss the chance of compounding it against all the other micro values. This is why I believe that the value of an individual post isn't that high, but the value of an account that produces a lot of little values outperforms the account itself.

It is impossible to calculate some of these values, even though the blockchain records the associated transactions, because there is a lot of tacit transfer of information that happens through the back and forth and in the heads of the audience and creators. It is something that a lot of people forget, that while influence comes from an outside source, behavior is driven internally and this can be a process facilitated passively or actively with intention.

Intentional action is like investing action, where the intention is to get benefits from a chosen behavior. This can lead to passive gains, as some behaviors can become codified habits, generating value without having to put a lot of thought into them. While others might take a lot of energy to apply, but they gain access to possibilities that wouldn't be there otherwise.

Very few professionals fell into all of the skills they needed in order to do the job, rather, it was a process where one thing led to another and took them down a pathway they may not have initially seen. Some of the things they might have enjoyed doing, some of the things they might not have, but they added to their ability to improve and do more of what they enjoyed doing. Like not liking gym work, but loving game day.

There are lots of skill clusters, but I was wondering what it is that makes a person interesting, something to consider for an attention economy. The easiest way to get attention is to create drama, but that is generally short lived and relying on it is likely going to push most people away, especially the audience that pays, as it is just too much to deal with, when life is full of other things that need handling too.

The hardest way to get attention is to be very good at what one does, as it not only requires the learning part, but also the delivery part to prove through making impact. In time though, once proven, the attention is there because trust is built, making further interaction far more likely and easier. Once proven, there is an assumption that what is to come will be valuable too and therefore, invitations are accepted.

While trust isn't easy to build, it is definitely easy to lose. This also means that if one doesn't want to lose it, there is a pressure to deliver what is worthy of the audience, which is a challenge in and of itself, especially if narrow in topic. This is possible for example with sports people who capture the attention of the people interested in the sport. But in general, those who make the biggest impact are those who bring more to the entertainment table.

Similarly to compound interest, there are also compound harms, where small action impacts will lead to an increasingly bad result. For anyone who has been in longer relationship that has failed knows, it is generally the little things that mount up, not the big things. I think that we all have a lot of small behavioral quirks that get in the way of of our potential, essentially working against the good behaviors. Therefore, reducing the bad actually helps compound the good, without necessarily adding more good. It is like cutting sugar out of the diet, but not increasing exercise, it will still be a benefit. Then, increasing exercise compounds those benefits.

While for a lot of people, this discussion might not be that interesting at all, perhaps for those looking to improve their outcomes, it gives some time and possibly some points to reflect upon. It might not be targeted toward investing or content creation, but understanding about how our actions compound and impact on our lives, is a good step toward building the behaviors and processes to improve our lives. Or perhaps, it changes how we consume and value content itself.

All it takes to generate large scale change, is a series of small steps.

What outcomes are you looking for?
What are you investing to support it.

Taraz
[ Gen1: Hive ]