Snowball Theory: The Powerful Inertia of Positive Decision-Making
Life is like a snowball. The important thing is finding wet snow and a really long hill.
Say you wanted to make a snowball. Not a snowball with which to hit a friend in the face, but one that is really, really big.
How would you go about making it?
One option is to just start packing—gathering the snow around you, forming the spherical shape piece by piece. You could even convince others in the neighborhood to help you with your effort. You can make a nice snowball this way.
But the snowball is only going to keep growing for as long as you and your friends have the patience and energy to continue the endeavor. What’s more, your task gets harder as you use up the snow in your immediate vicinity, and your snowball grows to the point where each additional handful of snow barely makes a difference in growing the snowball’s overall size. Mom will inevitably call you in for dinner. The game will be up.
You may be thinking, maybe thanks to the not-so-subliminal prologue, that there could be another way to build the snowball. But this other way is tough. The idea isn’t complicated, but it’s hard to execute because it takes time, foresight, and persistence. The method I’m referring to is, of course, finding the really long hill and letting the snowball roll. At first the person who was building the snowball by hand will have a big lead, because while he was building, you were thinking, planning, and trudging up a hill. But when all is said and done, your snowball is much larger—almost inexplicably larger—with the process having been oh so satisfying.
I often think about what Warren Buffett meant when he said that “life is like a snowball.” The most obvious answer certainly has to do with compounding interest; investments he made long ago are now bestowing upon him fabulous wealth. And he is constantly reinvesting the earnings his investments have generated, which builds him ever-expanding wealth into the future. As a young person he sought out knowledge about how businesses work, and insights he gained at that time have led to accomplishments that continue to build on themselves to this day.
But as Alice Schroeder illustrates in her book, The Snowball: Warren Buffett and the Business of Life, for Warren, the snowball was a metaphor for his approach to life, rather than a description of his financial success. His key insight has a profound effect on how we should go about making decisions, which I will elaborate on here. But first, a background concept.
One of the most pronounced themes of this publication is that we—as human beings—are terrible at making decisions when the consequences of those decisions manifest themselves over varying time periods. We have the capacity to conceptualize about things like the past and the future, yet our perspective is deeply rooted in the present moment. Our emotions, feelings, and instincts often inform us only about the next decision on the docket, the one currently being considered. These inclinations are highly valuable—even essential—to the decision-making process, however they heavily favor options that yield immediate rewards. They are not looking out for the future you.
This gets to the heart of one of the major decision-making mistakes we make. We tend to view decisions discretely, as if we can simply list out the pros and cons of each option and arrive at a satisfactory conclusion. And no matter what we chose, if we make a mistake or succumb to a tempting alternative, we will always get a reset next time around—an opportunity to get us back on track. The problem with this way of thinking is that decisions are not discrete but cumulative, meaning that choices don’t just yield outcomes; they actually dictate what choices you are presented with in the future.
This is easy to see through examples: We remember Abraham Lincoln for signing the Emancipation Proclamation. What was remarkable was not that he put pen to paper, but, rather, that he made thousands of decision that cumulatively led to the document being placed on his desk to be signed. If he wasn’t President or if he hadn’t spent the previous five years preparing the country for such a change, he would have never had the opportunity to make the decision to free the slaves.
In 2009, Warren Buffett, through the company he founded, Berkshire Hathaway, purchased the Burlington Northern railroad for the spectacular amount of $34 billion. This was quite a decision, but what is much more fascinating is the fact that one person could build a company from scratch that is financially capable of such a purchase. In other words, you see the $34 billion acquisition, but what you don’t see are the thousands of previous, smaller decisions that led to the acquisition even being possible.
So this is why we have to be careful when we think about decision-making as a series of “one-off” choices. I have seen it over and over again: repeated positive decision-making seems to have an almost inexplicable inertia, with the full cascade of benefits being almost impossible to discern until the story is over.
Good decisions have a way of building on themselves, but this process takes time. This is why “doing what it takes to get by” and general passivity are so dangerous. Any individual decision may be perfectly justifiable, yet the cumulative effect of this attitude is that one’s long-term potential is slowly eroded. It is our job, even though the future is always uncertain, to put ourselves in a position where good things can happen and opportunities can be seized.
But the question remains: how do you go about making these ‘good decisions’ time after time? The secret seems to be an attitude or mindset more than anything else. What’s amazing about our brains is that we can consciously steer them in certain directions if we so chose. Buffett trained himself, decision after decision, into metal habits that came to define him. We can do the same, at least in our own way.
And what are these mental habits that start the snowball rolling? It’s hard to say, but here are five things I have observed about successful snowball builders:
- They have goals and manage their time accordingly. Our minds need things to work towards. They are also easily distracted from those tasks. It is important that we spend the majority of our time in pursuit of that which we want the most.
- They are constantly seeking knowledge. Snowball builders are curious people with an insatiable appetite for information that can affect their understanding of the world around them. They have a particular affinity for information that challenges their preexisting notions or ideas.
- They challenge themselves to try things that are new and hard. The comfort zone is great for comfort, but bad for just about everything else. Trying and failing is fun because you realize you have put yourself in a position to be successful in the future.
- They are self-reflective and objectively evaluate themselves. Once you have done something many times and are good at it, trust yourself and your ability to get it right the next time. However after it is over, go back and critically examine your mistakes. This iterative process leads to rapid improvement.
- They only worry about things they can control. There are an infinite number of things in life you can worry about, but unless there is something to be done about them, don’t waste your energy. An Independence Day scenario is IRRELEVANT to me…I’m no Will Smith.
But maybe you are the next Warren Buffett. Your snowball doesn’t have to be green; you just have to steadily build towards something great until the momentum itself makes anything possible. You just discovered the wet snow. Now where is the long hill?