Last night I ran across an interesting perspective on the value of ideas versus execution. Here’s what the author, Derek Sivers, says:
Ideas are worth nothing unless executed. They are just a multiplier. Execution is worth millions.
- Awful idea = -1
- Weak idea = 1
- So-so idea = 5
- Good idea = 10
- Great idea = 15
- Brilliant idea = 20
- No execution = $1
- Weak execution = $1000
- So-so execution = $10,000
- Good execution = $100,000
- Great execution = $1,000,000
- Brilliant execution = $10,000,000
To make a business, you need to multiply the two.
Using this logic, a brilliant idea with so-so execution is worth $200,000, but a so-so idea with brilliant execution is worth $50,000,000 (250X more).
I generally agree — more value is created by great execution than great ideas. But I also believe that ideas and execution are not independent concepts — great business ideas are, by definition, easier to execute. Why? Here’s a few reasons:
- Great ideas are usually unique, which means less competition
- The best ideas are usually simple ones
- Great ideas are more inspiring and motivating
My point is this: Part of what makes a great business idea great is that it can be executed in an elegant way. Ideas that sound great but are impossible to execute or address a non-existent market are just interesting. The world is littered with interesting ideas that make terrible businesses — I’ve come up with a few myself! But some ideas are so good that they leave room for error — even if you only get them 80% right you’ve got a nice business on your hands.