• Your competitive advantage is formed by the interplay of three different, ever-changing forces: your assets, your aspirations/values, and the market realities, i.e., the supply and demand for what you offer the marketplace relative to the competition

  • You have two types of career assets to keep track of: soft and hard. Soft assets are things you can’t trade directly for money. They’re the intangible contributors to career success: the knowledge and information in your brain; professional connections and the trust you’ve built up with them; skills you’ve mastered; your reputation and personal brand; your strengths (things that come easily to you). Hard assets are what you’d typically list on a balance sheet: the cash in your wallet; the stocks you own; physical possessions like your desk and laptop. These matter because when you have an economic cushion, you can more aggressively make moves that entail downside financial risk. For example, you could take six months off to learn the Ruby programming language with no pay—i.e., pick up a new skill. Or you could shift to a lower-paying but more stimulating job opportunity. During a career transition, someone who can go six to twelve months without earning money has different options—indeed, a significant advantage—over someone who can’t go more than a month or two without a paycheck

  • All Advantages Are Local: Pick a Hill That Has Less Competition The most obvious way to improve your competitive advantage is to strengthen and diversify your asset mix—for example, learn new skills. That’s certainly smart. But it’s equally effective to place yourself in a market niche where your existing assets shine brighter than the competition’s. For example, top American college basketball players who aren’t good enough to play professionally Stateside frequently play in European leagues. Instead of changing their skills, they change their local environment. They know they have a competitive advantage in a market with lower-quality competition

  • ABZ Planning is the antidote to the “what color is your parachute” approach to career planning. It is an adaptive approach to planning that promotes trial and error. It allows you to aggressively pursue upside and mitigate against possible downside risks

  • So what do A, B, and Z refer to exactly? Plan A is what you’re doing right now. It’s your current implementation of your competitive advantage. Within a Plan A you make minor adjustments as you learn; you iterate regularly. Plan B is what you pivot to when you need to change either your goal or the route for getting there. Plan B tends to be in the same general ballpark as Plan A

  • Sometimes you pivot because Plan A isn’t working; sometimes you pivot because you’ve discovered a new opportunity that’s just better than what you’re doing now. In either case, don’t write out an elaborate Plan B—things will change too much after the ink dries—but do give thought to your parameters of motion and alternatives. Once you pivot to a Plan B and stick with it, that becomes your new Plan A. Twenty years ago Sheryl Sandberg’s Plan A was the World Bank. Today, her Plan A is Facebook, because it’s where she is right now

  • Plan Z is the fallback position: your lifeboat. In business and life, you always want to keep playing the game. If failure means you end up on the street, that’s an unacceptable failure. So what’s your certain, reliable, stable plan if all your career plans go to hell or if you want to do a major life change? That’s Plan Z. The certainty of Plan Z is what allows you to take on uncertainty and risk in your Plans A and B

  • Career plans should leverage your assets, set you in the direction of your aspirations, and account for the market realities

  • Plan Z: a reliable plan you shift to when you no longer have confidence in Plan A and B, or when your plans get severely disrupted. The certainty of the Plan Z backstop is what enables you to be aggressive—not tentative—about Plans A and B. With a Plan Z, you’ll at least know you can tolerate failure. Without it, you could be frozen in fear contemplating the worst-case scenarios

  • When I started my first company, my father offered up an extra room in his house in the event it didn’t work out—living there and finding a job somewhere else to earn money was my Plan Z. This allowed me to be aggressive in my entrepreneurial pursuits, as I knew I could draw my assets down to zero if necessary and still have a roof over my head. Becoming homeless or bankrupt or permanently unemployable is an unacceptable outcome when one of your career plans fails. Your Plan Z is there to prevent these unacceptable outcomes from becoming realities

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